Premium economy bookings soar as businesses prioritise comfort over cost

As Australia strengthens its international trade ties, new data reveals that travellers are increasingly opting for premium economy, valuing comfort, restfulness and productivity over chasing the lowest fare.

New booking data from Corporate Traveller, the flagship SME division of Flight Centre Travel Group (FCTG), reveals premium economy corporate bookings increased 35 per cent year-on-year in the March quarter (Q1 2025), despite the average international return airfare in the cabin rising nine per cent over the same period.

Premium economy sits between standard economy and business class, offering a cost-effective solution for travellers seeking additional comfort. As airfares across premium cabin classes continue to rise, premium economy has emerged as an attractive value option compared to the steeper increases seen in first and business class fares.

“Lowest airfares are no longer the number one priority for business travellers,” says Tom Walley, Global Managing Director at Corporate Traveller. “Many organisations are recalibrating value, balancing comfort, productivity and employee wellbeing against price. Premium economy is increasingly seen as the sweet spot for long-haul travel.”

In the March quarter of 2025, the average international return fare ex-Australia in premium economy was $4,495, a nine per cent increase from $4,115 a year earlier. In contrast, fares in business and first class cabins have seen sharper price hikes, making premium economy a more accessible step up from standard economy, without the significant cost of a business class seat.

The trend toward comfort without breaking travel budgets mirrors innovations like Air New Zealand’s ‘SkyNest’ initiative.  A new offering, coming in 2026, will allow economy passengers to book lie-flat sleeping pods on long-haul flights for an additional fee, highlighting the rising premium placed on restfulness mid-air.

Corporate Traveller’s latest insights also show that industries including manufacturing, construction, IT, and finance are leading the demand for premium economy travel. The top five most popular destinations booked in premium economy in 2025 were revealed as London, Singapore, Los Angeles, Los Vegas and Shanghai.

Despite this seating class’s popularity, a Corporate Traveller survey of its travel advisors found that most believe premium economy offerings could still improve. The most requested upgrades include access to business class lounges, greater seating width, deeper seat reclines, improved privacy between passengers and additional legroom. When asked which airlines deliver the best premium economy experience, Singapore Airlines topped the list, followed by Qantas and Air New Zealand.

“Benefits that focus on genuine comfort, restfulness and not just priority boarding or meal upgrades are what today's travellers value most,” says Tom. “Travellers are willing to pay a premium for a better experience that allows them to arrive refreshed, ready to do business and maximise the return on their travel investment.”

“As business travel evolves, organisations are putting greater emphasis on traveller wellbeing and productivity. Flying premium economy offers the balance between comfort, cost-efficiency and business effectiveness, helping travellers arrive ready to perform at their best.”

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About Flight Centre Travel Group

The Flight Centre Travel Group is one of the world’s largest travel retailers and corporate travel managers. The company, which is headquartered in Brisbane, Australia, has company-owned leisure and corporate travel business in dozens of countries, spanning Australia, New Zealand, the Americas, Europe, the United Kingdom, South Africa, the United Arab Emirates, and Asia. ASX listed Flight Centre Travel Group (FLT) also operates the global FCM corporate travel management network, which extends to more than 100 countries through company-owned businesses and independent licensees, along with Corporate Traveller, the flagship business specific to the small-to-medium-sized enterprise sector. For more information, visit fctgl.com.