It took a bit, but the surge in premium travel interest appears to have reverted back to good ol’ fashioned economics in the United States.

Internet searches for “Business class” and “Premium economy” grew rapidly during the COVID recovery. Both search terms exceeded pre-pandemic levels by April 2022 - a trend that has been mirrored in airline earnings and fare data.

However, this rapid growth in premium travel interest appears to have plateaued. Instead, “Basic economy” has since caught up to the premium queries.

At first glance, these results may seem contrary to Delta Air Lines’ recent earnings comment of strong premium economy demand, but closer inspection shows similar trends. Premium travel is not down; in fact, it remains at elevated levels. What has changed is the interest in bargain fares - an interest likely often left unsatisfied during the high fares of the prior two years.

The gap in search levels between the premium and discounted searches grew to its largest levels during 2022 and extended through mid-2023. This coincided with a deep pilot shortage in the U.S. and an overall shortage of narrowbody aircraft. The result was high fares - and apparently a shift in interest by travelers to consider premium classes.

However, since the start of Q3 and the overshoot of U.S. capacity, those factors appear to have reverted. While premium travel interest remains elevated, it has returned to the long-term trend of growth, eclipsed by the return of searches for “Basic economy.”

By expanding the timeframe back to 2010, the longer-term trends of this inexact science emerge. Interest in “Premium economy” has grown exponentially since 2010, reverting to the trend in 2024.

“Basic economy” searches barely existed before 2017 when the term entered the traveler's lexicon, with legacy airlines adding the discounted and restrictive fare class.

While this measures internet search interest rather than actual bookings, the trends do align with broader industry reports. If passengers are forced to pay high fares, as they were in 2022 and the first half of 2023, they might as well consider premium fares.

Much like many post-COVID trends, however, this has also begun to revert back to normal. While this may appear a bad omen for the legacy airlines, not all trends have reverted to pre-COVID levels.

Sharp increases in searches for “Airline credit card” show just how much has changed in the legacy airline business models.

We are watching very closely whether these trends revert, as well. Given sufficient seats from which to choose, the American traveler has proven to be cost-conscious. Should capacity continue to increase, we expect the shift away from low frills to rebound.

This doesn’t mean that premium interest will decline, just that customers are once again becoming more cost-conscious with their travel searches. Overall search levels are higher, responding to the overall growth in the market.

Which brings us to another interesting trend we’ve noticed in travel interest. What topic piqued the American traveling public’s interest starting in 2008 but is now just not as interesting?

Click here for the answer.

Research published this week

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