In recent months, I’ve been writing a lot about the changes to the credit card market, warning that in 2017 many bank-issued AMEX cards would likely disappear. That’s because new laws have reduced the “interchange” fees banks can charge merchants when you use your credit card, with bank-issued AMEX cards the most severely affected. Those fees pay for the points you earn, so lower fees means fewer points.

Today, we heard that ANZ is the first of the major banks to announce a shake-up of its AMEX cards. ANZ has ended its relationship with American Express, stopped taking new applications for AMEX cards, and will shut down existing cards on 5 August 2017. That’s a big change.

ANZ will continue to offer only Visa cards and it’s rejigging the points earning rates on those.

It surely won’t be long until we hear other banks announce changes to their AMEX products, given the new laws take effect on 1 July 2017. The banks may follow ANZ’s lead and discontinue their relationship with American Express, or they may negotiate new agreements (with fewer points for many customers) – we wait and see.

AMEX cards issued directly by American Express Australia are exempt from the new laws. As I’ve written about previously, a simple strategy for maximising points moving forward is to hold a high-earning AMEX card issued by American Express Australia, with a backup Visa or MasterCard from another provider for use with merchants who don’t accept AMEX.

It’s been almost a week since Qantas released details of its new premium economy seat for the Dreamliner fleet, and the reaction from many frequent flyers has not been kind.

The Qantas marketing machine created huge expectations before the announcement, with CEO Alan Joyce promising the seat would be “revolutionary” and “class-leading”. This came after a year of speculation and hype about almost every aspect of the Dreamliner – from its configuration, to the seats and the routes it will operate. It’s safe to say many people are a bit weary from it all.

What Mr Joyce unveiled last week was a seat that looks quite comfortable and has some great features, like a recline system and padding designed to promote sleep. However, Qantas won’t be giving passengers anywhere near ‘class-leading’ space.

The 38 inches of leg room on offer is 3-4 inches less than on Virgin Australia and Air New Zealand. Given Qantas wants to fly the Dreamliner on a 17-hour non-stop flight, that lack of space could be a big deal.

The new Qantas premium economy seat

Air New Zealand’s much more “revolutionary” premium economy seat

Instead of under-promising and over-delivering, which would have been the sensible thing to do, Qantas took the opposite approach. It showed no signs of slowing down at last week’s announcement, where Mr Joyce claimed the seat has “a serious wow factor” and is “completely different from anything else in its class.” An article on the Qantas website even said the seat was “so comfortable you’ll swear you’re in Business” (unlikely).

Understandably, many people are less than impressed by the details released last week.

One of the world’s most widely-read travel bloggers, Ben Schlappig, said it was a fib when Mr Joyce promised the seat would be “revolutionary”.

In another article that came across my feed, John Walton at the Runway Girl Network concluded that the seat was “barely evolutionary” in function.

The mood on various Australian frequent flyer blogs and forums has been one of disappointment. Many people like the extra padding, recline and other features, but the consensus is this doesn’t compensate for the restricted space. My initial view was similar, though I’ll reserve judgment until I get a chance to try the seat.

As a loyal Qantas frequent flyer, I’m disappointed to see the airline’s credibility take a hit like this. There’s an obvious lesson here about over-hyping things, but Qantas’ PR strategy for the Dreamliner has been all about generating maximum attention.

The next news to come out will be the pricing of the fares on the Perth-London route, and I suspect they won’t be cheap. It’ll be interesting to see if people have ‘bought’ the value proposition that Qantas has been trying so hard to make.

Emirates has announced a redesign of its famous A380 onboard lounge, with a more modern look and extra seating being installed. The lounge, which is available to business and first class passengers on the upper deck of the A380, has become an iconic feature of Emirates’ fleet since it was launched in 2008.

The new lounge will retain the trademark horseshoe-shaped bar.

More seating will be added along the windows on both sides of the bar, which Emirates President Tim Clark says was inspired by private yacht cabins (of all things!). Overall, the new lounge will comfortably accommodate up to 26 passengers at a time, including 8 seated.

A new colour scheme will see lighter champagne colours in the cabin and on lounge seating, accented by a glossy dark wood trim. This is a big improvement from the current darker and overly-blingy décor.

Customers will continue to enjoy canapés, wines, spirits and cocktails at the bar.

Emirates will also introduce soundproof curtains to partition the lounge from the other cabins, which will be welcomed by passengers seated near the area.

Soft ambient lighting options, new window blinds with integrated LED mood lighting, and subwoofers for surround sound are also going in.

The revamped lounge is currently being installed onto one of Emirates’ brand new A380 aircraft, and will make its operational debut in July 2017. At the moment, Emirates only plans to install the new lounge on new planes. Let’s hope an upgrade to the existing lounges will happen at some point too.

Qantas has finally pulled back the curtain on new premium economy seat for its Dreamliner fleet.

The highly-anticipated new planes will be in Australian skies in October before operating on key international routes, starting with Melbourne to Los Angeles in December and then the record-breaking Perth-London flights from March 2018.

Qantas CEO Alan Joyce has stoked high expectations for the new premium economy seat, claiming in recent months that the design would be “revolutionary”.

Given Qantas already operates a pretty good premium economy product on its A380s and B747s, a lot of hype has built up.

So, here it is – the new Qantas premium economy seat.

With a width of “up to” 22.8 inches (but actually a bit less because of the way Qantas measures it), the seat is slightly wider than Qantas’ existing premium economy seat.

However, the 38 inches of leg room is the same at the current product, and the 9.5 inch recline is only marginally better (the current seat provides 9 inches).

By comparison, Virgin Australia and Air New Zealand provide an extra 3-4 inches of leg room (with a slightly smaller recline). Singapore Airlines and Cathay Pacific both offer 38 inches of leg room with an 8-inch recline.

Qantas premium economy passengers who have someone in front of them fully reclined will have a nightmare getting out of their seats.

On the basis of these factors, I wouldn’t say the new Qantas seat is revolutionary at all – but it is competitive.

What might be unique is the recline motion Qantas has developed, with several sections shifting to support your body as you recline into a more relaxing position.

Qantas CEO Alan Joyce says “you have to experience how well it supports you when you recline to realise it’s completely different from anything else in its class.”

We’ll have to wait and see until we try it.

Other features of the new Qantas premium economy seat include:

• a headrest that can be fitted with a specially designed pillow
• a footrest
• a 25 per cent larger HD Panasonic entertainment screen (13.3 inches) plus a holder for an iPad if you prefer to bring your own entertainment
• five individual storage compartments
• two USB charging points per seat, as well as shared AC power (it would have been better for every seat to have AC power)
• personal LED light.

My overall impression is this: I like the new features such as the recline, storage and screen, but I can’t help being disappointed by the space provided, especially the leg room. This is likely to be a key factor for passengers on ultra-long-haul flights. Hopefully the seat padding and extra width will provide some additional comfort.

The Dreamliners will have 28 premium economy seats arranged in four rows in a 2-3-2 layout.

They’ll be located right in the centre of the plane between business and economy (in green on the seat map below).

Passengers will have access to the two toilets between rows 8 and 10, shared with business class.

The Dreamliners will also sport new economy and business class seats, as I wrote about in October.

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First class travellers must be feeling pretty nervous: the world’s leading airlines are increasingly cutting back on first class space in favour of more business class and premium economy seats.

The old norm in long-haul travel – that aircraft were configured with first, business and economy – is morphing into a choice between business class, premium economy and economy on numerous routes. In many ways, premium economy has become the ‘new’ business class and business class the ‘new’ first.

But is this such bad news for passengers at the pointy end? I don’t think so.

The quality of business class products has increased dramatically in recent years, blurring the lines between business and first. Meanwhile, prices for business class fares are falling in many markets (though not so much in Australia, yet). And while first class capacity is going down, that which remains is getting better. Consumers are also benefitting from airlines finally investing more in premium economy.

Overall, the future of premium travel looks pretty bright. Here’s what I think is in store.

To begin, it’s clear that demand for first class is in decline. A procession of airlines has announced cutbacks recently, the latest being the German flag-carrier, Lufthansa, which said last week that its new Boeing 777-9 fleet will top out at business class. This puts the future of its highly-regarded first class product in serious doubt.

Lufthansa B747 first class – why choose between a seat and a bed when you can have both

In January, Singapore Airlines confirmed it will reduce the number of first class suites on its next batch of A380s. Singapore Airlines has been one of the most innovative airlines when it comes to first class, but times are tough. First class has been ditched from some new aircraft while the airline is investing in new and improved business and premium economy seats.

Singapore Airlines’ dwindling A380 first class suites

Here in Australia, Qantas announced in late-2016 that its much-hyped new Dreamliners will be geared towards premium travellers, but with no first class on offer – despite flying on lucrative long-haul routes such as London and Los Angeles. Instead, the aircraft will feature a large number of business and premium economy seats, including the next generation of Qantas’ excellent Business Suite. A new premium economy seat is set to be announced in the next few months.

The Business Suite – coming soon to the Qantas Dreamliner fleet

Many other airlines in the region are making similar changes, including Cathay Pacific, Qatar Airways, Japan Airlines, Asiana and many more. The trend is clear.

So what’s driving this?

The rising quality of business class products is a huge factor. It’s becoming the norm for airlines to offer spacious seats, great on-board services and other comforts in business class that used to be more commonly seen in first class.

Qatar Airways’ award-winning A350 business class

Middle Eastern carriers deserve a lot of credit for driving big improvements in business class. Other airlines have been forced to compete – even US carriers, which have been notorious for their mediocre premium products.

Delta’s new business suite

The improvements in business class have been rapid and are set to continue, while prices on many routes have fallen, so it’s no surprise travellers are making the switch. The extra cost of flying in first class just doesn’t stack up for many.

For airlines, flying empty first class seats makes no commercial sense nor does saving them for passengers upgrading from business class. Airlines have to maximise the yield from every square inch on board, especially as the focus shifts towards operating smaller aircraft on long-haul routes.

Further down the plane, premium economy has come into its own over the last few years. Despite being around for over two decades, many airlines only recently committed properly to premium economy. Singapore Airlines, for example, only started offering premium economy in 2015.

Singapore Airlines A350 premium economy

Premium economy taps into the market for an affordable, low-frills service that’s still a clear step-up from economy. This suits both travellers switching from business class due to reduced travel budgets and those moving up from economy because a better in-flight experience is now in reach.

Cathay Pacific premium economy

It seems clear premium economy and business class will continue to boom. But what does the future hold for first class?

I think premium airlines will continue to offer first class on select routes, such as those connecting the world’s major capitals. Demand hasn’t completely dried up for the luxury and privacy only first class can provide.

While capacity is going down, the quality of what’s left is going up. Etihad has set a new standard in first class with its opulent ‘Residence’, which offers three ‘rooms’ and a butler service. Etihad’s ‘regular’ first class suites are also wonderful.

Etihad does first class luxury like no one else

Other airlines are responding. Singapore Airlines recently announced it will install larger first class suites, while Emirates’ CEO has said the airline will soon begin offering “fully enclosed rooms with all the touches and amenities that you’d expect in hotel or a private bedroom on a luxury yacht”.

For travellers who use points to fly first class, the key takeaway is this: the reduced capacity will almost certainly make it harder to secure award seats in the coming years. If you’ve never experienced first class and that’s your goal, I suggest you don’t delay.

For regular first class travellers, the quality of business class today means most of the comforts you’re used to will be available if you have to switch – and you’ll probably save money.

For everybody else, I think we’re in a golden age of premium travel – and the future looks bright.

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Just yesterday I published my review of business class in a Qantas A380, noting that I enjoyed the experience but there were some major issues with the seat. I finished by saying that “hopefully the Qantas A380 fleet will soon be refurbished”.

Well, wouldn’t you know it, AusBT is reporting today that Qantas may soon do just that. According to today’s article (which is probably well-sourced) Qantas is planning an extensive A380 refurbishment program beginning as early as 2018 to sharpen its competitive edge.

Several problems I pointed out in my post yesterday look like they’re being targeted, including the lack of personal storage space, mediocre entertainment screen and outdated 2-2-2 cabin layout.

Current Qantas A380 business class seats

It seems likely that the latest generation of Qantas’ highly-regarded ‘Business Suites’ will be fitted onto the superjumbos. I recently reviewed the business suite and concluded it was a great product – spacious and comfortable, with a 1-2-1 layout, lots of personal storage space and an excellent 16-inch entertainment screen.

The Qantas Business Suite, currently only on the A330s

The Qantas Business Suite – coming soon to A380s?

Qantas is currently making minor tweaks to the business suite before it’s installed on the airline’s forthcoming B787 Dreamliners. It makes sense to also refit the A380s with this high quality product.

The upgrade – if it happens – will be great news for loyal Qantas customers and those with no other options on some routes, like Dallas. It will also help Qantas compete with superior business class products currently offered by Emirates, Singapore Airlines, Cathay Pacific, Virgin Australia and others.

It seems likely that Qantas will also upgrade first class and premium economy seats on the A380s. Hopefully we’ll get official confirmation and more details in the next few months!