Why airline class wars will intensify in 2026
Planes line up on the tarmac at LaGuardia Airport in New York City on November 10, 2025.
Spencer Platt | Getty Images News | Getty Images
Spirit Airlines’ struggle for survival American AirlinesFrom new international routes and brand new airport lounges to stricter frequent flyer policies, the planned glitz will intensify class divisions in the skies in 2026.
Airlines entered 2025 optimistically: Delta Airlines CEO Ed Bastian is predicting a record year for the century-old carrier. But President Donald Trump’s trade war, skittish consumers and concerns about an oversupply of domestic seats have driven down U.S. airfares and weighed on industry profits.
“This is the airline version of the K-shaped economy. Make money at the top of the K and minimize the deficit at the bottom,” said Robert Mann, who has worked for several airlines and is president of aviation consulting firm RW Mann & Co.
Now leaders of the nation’s largest airlines are focusing even more on customers who will pay extra for their tickets in exchange for a little more space or other perks like earlier boarding and access to overhead luggage space, which is never enough.
A view of the American Airlines first class cabin of a Boeing 737.
Leslie Josephs/CNBC
They still face ongoing problems, such as a shortage of air traffic controllers and aging infrastructure. Even with billions in additional federal spending to fix some of the problems, major improvements will take years.
Mann said airlines need to do more to improve reliability. According to the Department of Transportation, U.S. carriers, which define on-time delivery as arriving within 15 minutes on schedule, had a 77% on-time delivery rate.
“When the flight is delayed or cancelled, it doesn’t matter if you’re at the top of the K or below the K,” he said.
Here’s how the next year will shape up for the airline industry:
Winners take (almost) all
In the first nine months of the year, Delta and United Airlines It accounted for nearly all of US airline profits.
This is an industry divide that has been developing for years; This has been further fueled by rising costs and changing consumer tastes, with wealthier travelers increasing their share of total spending.
While the economy remains largely resilient, any weakening in 2026 could have a major impact on price-sensitive consumers and thus airlines with greater exposure to coach-class domestic travel, such as low-cost carriers.
These airlines are making their own moves. JetBlue Airlinesfor example, it is shifting its focus to more profitable routes and premium seats. It plans to introduce a domestic business class in mid-2026, with seats at the front of the cabin that are larger but not as elaborate as the higher-end horizontal Mint suites.
Fixed fees
Airfares are likely to remain flat next year through 2025, according to American Express’ Global Business Travel forecast in mid-November.
Demand recovered after falling for a while There’s a record-long government shutdown, but it’s unclear whether 2026 will be a blockbuster year.
Southwest Airlines CEO Bob Jordan told CNBC in December that “the first quarter looks strong” but that it’s “hard to say” whether it will be better than a year ago.
Where does the soul go?
Budget-struggling travel icon Spirit Airlines JetBlue’s second bankruptcy in less than a year after its acquisition was blocked by a court, engine stalling, rising costs and other problems raise questions about its ability to survive.
Industry experts and airline analysts said that the airline with the yellow plane will have to make much bigger moves with this bankruptcy.
“We do not expect it to remain a standalone company by this time next year; a merger or Chapter 7 outcome is likely to push our earnings estimates higher,” Raymond James said in a Dec. 19 note.
Analysts expect the merger partner to be Border AirlinesThe budget airline has attempted to merge with Spirit multiple times since 2022, but it’s unclear whether the two sides will reach an agreement. Spirit said earlier this month that it was in “active negotiations” for a standalone restructuring or a transaction. Frontier and Spirit declined further comment.
southwest transformed
Southwest is preparing for a big change in 2026. The airline’s decades-long cattle call will end on January 27. allocated seating begins.
It comes as a result of a series of changes it had already introduced last year. It introduced extra legroom seats at higher prices and began charging many customers for baggage checks for the first time, a service that brought in more than $7 billion in revenue for its U.S. rivals in 2024, the last full year of available data, according to the Department of Transportation.
The carrier’s shares are among the highest-earning stocks among U.S. passenger airlines. Southwest shares are up nearly 23% in 2025, compared to a 5% rise for the NYSE Arca Airline Index, outperforming profit leaders Delta and United as well as the broader market.
Investors are optimistic about the company’s transformation into a more traditional, segmented airline, accelerated by a stake from activist investor Elliott Investment Management.
american makeup
American expands lounges and opens a fleet Airbus 321XLR aircraft aim to capture the luxury travel boom in 2026. American said last spring that free inflight Wi-Fi would also be coming for loyalty program members starting in January.
The airline has already made smaller changes to elevate its brand, such as adding Lavazza coffee to all passengers and Champagne Bollinger to its higher-end lounges and cabins, but there’s a long way to go to reach Delta’s and United’s profitability.
American Airlines and Delta planes are on the tarmac at LaGuardia Airport (LGA) in Queens, New York, USA, on Friday, November 7, 2025.
Michael Nagle | Bloomberg | Getty Images
Just before Christmas, American announced it would no longer reward customers with no-frills basic economy tickets with frequent flyer miles, following a similar move by Delta a few years ago.
American has yet to announce changes to elite status requirements for 2027, but the airline is under pressure as Delta and United say they will keep status thresholds constant.
The airline is also making some changes aimed at improving reliability, and recently announced it would expand its so-called banks, or flight clusters, at its largest hub, Dallas Fort Worth International Airport, from nine to 13.
American is also testing two electronic gates where passengers scan their own boarding passes on narrow-body domestic flights in hopes of getting passengers onto planes faster, and said it will remove bag sizers from the gates in September.
