American Airlines 777-300ER landing.
American Airlines will refit 20 Boeing 777-300s by late 2024.Nik Oiko/SOPA Images/LightRocket via Getty Images
  • Customers are not booking seats in first class.

  • Flagship Suites is the new business class offering.

  • The number of premium seats on the planes will increase by 45%.

Customers no longer book seats in the premium cabin on long-haul flights, which is why American Airlines is no longer offering first class seats.

"For the simple reason that our customers aren't buying it, first class will not exist on the 777, or for that matter at American Airlines," Raja said during an investor call Thursday. The airline may retire the offering on some planes, Raja said.

In September, American unveiled its new 'Flagship Suite' business class, as part of plans to increase the number of premium seats available on its long-haul flights.

The Flagship, which includes a lie-flat bed and privacy door, will be installed on America's brand new Boeing 787-9s and the A321XLR. The airline will retrofit 20 of its Boeing 777s with a new suite late in the same year.

Raja explained that the shift reflects a change in the type of journeys passengers choose to take.

Half of the demand for premium cabins used to come from large contracted corporations, but now between 40% and 50% of that demand is "blended demand", Raja said.

Raja said that the rest of it is leisure demand that is willing to pay more for the quality of the seat.

The removal of first class will allow the airline to provide more business class seats, which is what our customers most want or are most willing to pay for.

American Airlines did not reply immediately to Insider's request for further comment.

The third-quarter results were published Thursday.

More than half a million flights were flown by the American Airlines Group in the third quarter. The group's revenues increased by 13% compared to the same period in the previous year due to the COVID Pandemic.

The airline said that Q3's results were a new record.

It's not the only airline that is benefiting from increased demand for travel.

Scott Kirby, United's CEO, said that the quarter was one of the best he had ever seen. United said that hybrid working is helping to fuel that demand.

Business Insider has an article on it.