Last summer, Minneapolis-based Sun Country Airlines announced that they were planning on undergoing a major transformation, aligning more closely with the business model of an ultra low cost carrier. For years the airline has been surprisingly full service, offering free carry-ons, a competitively priced first class, and more. However, clearly they haven’t been able to command much of a revenue premium for their superior onboard product.
The airline hired a former Allegiant Air executive as their CEO, and it’s clear they’re now trying to align themselves more with Allegiant, Frontier, Spirit, etc.
Sun Country’s planned transformation
Going back several months, Sun Country announced that they will:
- Adjust their route network so that they’re no longer just operating flights to & from Minneapolis, but rather are operating more point-to-point flights
- Retire their 737-700s, and instead focus on only having 737-800s in their fleet
- Maintain first class, but make the cabin smaller, and reduce the services offered, to make it similar to Spirit’s Big Front Seat
- Reconfigure 737-800s with 180 seats, rather than the current 162 seats
- Charge for carry-ons
- Eliminate their elite frequent flyer program
Sun Country’s updated strategy & cabin refresh plans
It looks like Sun Country has had a change in strategy even compared to their previously announced plans, which they’ve outlined in an email sent to employees this week.
Sun Country plans to reconfigure their entire fleet in November and December (their fleet will reach 30 planes by the end of the year), which will be a $20 million project. Sun Country plans to install slimline seats, add wifi and streaming entertainment, and add power outlets to all seats (regular seats will have USB outlets, while premium seats will have full power outlets).
Sun Country plans to increase their seating capacity on their 737-800s to 183 seats, which is an increase of 21 seats compared to the 162 seats these planes currently have (12 seats in first class and 150 seats in economy).
The Star Tribune reports that they also plan to keep their 737-700s and reconfigure them with 183 seats, though that can’t be accurate, as there’s no way you can fit that many seats on a 737-700. For example, SAS’ all economy 737-700 features 141 seats.
Furthermore, previously the airline was planning on keeping first class seats, but that’s not happening anymore — now Sun Country plans to eliminate first class altogether.
Instead Sun Country plans to install “premium economy” near the front of the plane (in a 3-3 configuration), featuring 34″ of pitch and (probably) two complimentary alcoholic drinks per person. They aren’t planning on offering these passengers complimentary food, but they do plan to extend their buy on board menu with more fresh options (though nothing hot).
In addition to the premium economy section, the airline plans to have an extra legroom economy section with 32″ of pitch (so 2″ less than at the front of the plane, and no free drinks), and then further back they’ll offer 29-30″ of seat pitch.
Reports suggest that the airline has been losing money on first class — they’ve only been selling about half of the first class seats, and nearly a third of the seats fly empty. Sun Country’s SVP of Commercial said the following:
“That makes it feel like that isn’t an appropriate product for our customers. I’m fully prepared that there are some people who like first class and will be disappointed to see it go. If we look at the big picture, we believe this is the right decision.”
However, the airline says they aren’t going fully ultra low cost carrier, as Sun Country will continue to offer complimentary soft drinks, power outlets, wifi, and streaming entertainment.
My take on Sun Country’s transformation
While Sun Country has long been an airline that’s loved by those in the Minneapolis area, they weren’t able to achieve a revenue premium over their competitors for all the services they offered. In other words, people loved Sun Country, but weren’t willing to pay extra to fly with them. So from a business perspective it’s perfectly logical that they’re deciding that something needs to change. They were only reporting fairly small profits, while other major US carriers were reporting their best results ever.
What I find interesting here is that is that they’re still only taking a hybrid model. They’re not going full ultra-low cost carrier. They’re making the cabin density similar to what you’d find on an ultra low cost carrier, and they’re charging for carry-ons, but they’ll offer free soft drinks provide power outlets, wifi, and streaming entertainment.
While I think the general trend over time is that ultra low cost carriers will offer power outlets and wifi, I find the choice to offer free soft drinks interesting. Do they think this will be a small thing they can do to appease passengers, and if so, do they really think it will get them extra business?
The reality is that going forward Sun Country doesn’t really need loyal flyers anymore. Previously they were based out of Minneapolis and almost all flights were through their hub. Going forward they’ll be operating a lot more point-to-point flights, so in many cases they’re just going after people looking for the lowest fares.
I’m curious to see how Sun Country’s new business plan plays out.
In the meantime, it’s sad to say goodbye to what was one of the best airlines in the US in terms of passenger experience.
What do you make of Sun Country’s cabin refresh plans?
(Featured image courtesy of Cory W. Watts)