United Airlines is ramping up its business class offerings in an aggressive push to lure travellers to America and take market share from Qantas amid a rising backlash against holidays in the US amid Trump’s global trade war.

America’s largest airline – which nearly equals Qantas in US-Australia seat capacity – has announced a raft of enhancements at the front of the plane to woo dollars from deep-pocketed long-haul travellers, including more spacious seats and privacy, and is fork out more than $US150 million ($232 million) a year to turn its food and beverage offers into fine dining at 35,000 feet.

It is the latest step in a kind of arms race of luxury offerings by airlines to capture more of the higher-paying international traveller segment. The trend has become more important as United said that second quarter booked international passengers on flights from Europe fell 6 per cent from the same time last year. Canadian origin passenger volumes, meanwhile, dropped 9 per cent over the same period.

The company’s new business product, called the United Polaris Studio suites, offers lie-flat, all-aisle-access seats, 25 per cent larger than the already generous standard Polaris seats on board its new Boeing 787-9s. They will be located ahead of its already popular Polaris business class.

US air carriers have increasingly counted on demand for premium economy seating to help them recover from the impact of the COVID-19 pandemic and now withstand any anti-US backlash related to Donald Trump.

Speaking to reporters flown to New York for the unveiling of the new business push, United’s chief commercial officer, Andrew Nocella, said the pandemic conditioned consumers to desire more space and higher quality service aboard planes.

The appetite for premium seating is “getting stronger, not weaker”, he said. “During the pandemic, there was a desire for more space and more separation for all of the obvious reasons ... And that trend continues to this day, and in fact, is accelerated,” he said.

The appetite for premium seating is “getting stronger, not weaker”.

The food upgrade will include “an amuse-bouche of Ossetra caviar paired with Champagne Laurent-Perrier Cuvee Rose”, as well as mid-flight meal options of “regionally influenced tapas”. The airline is also adding trendy drinks such as Aperol Spritz to the menu.

Australian aviation economist Tony Webber said United’s latest offering showed how a lot of the premium supply was simply “catching up with demand”.

“That demand hasn’t been met because the airlines haven’t been putting premium ... on their services quickly enough,” he said.

However, Webber warned that the Trumpian effects on travel bookings haven’t yet “fully worked their way through the system”.

Any more notable falls in the equity markets could affect flight bookings, he warned. Equity markets were a “big driver of Australian outbound travel”, he said. Superannuation funds lost 4.5 per cent the week of April 2 after US President Donald Trump announced his sweeping tariffs. However, stocks have recouped their losses since then amid hopes for easing trade tensions.

The political chaos spurred by Trump has already dampened demand for US holidays from Australian travellers, figures show. Leisure travel bookings to the US have dipped as much as 10 per cent in the first quarter, compared with the same period last year, data from Flight Centre shows, as consumers chose Asia and Europe as a destination.

Airlines have been marking down growth estimates amid the uncertainty generated by the Trump’s global trade war. Last month, Delta Air Lines withdrew its profit forecasts because of the uncertainty in global trade. European carrier Air France-KLM indicated it would cut prices to keep its transatlantic economy cabins full.

Cost of compensation

Meanwhile, in comments likely to be watched closely by Qantas, United Airlines boss Scott Kirby said that new regulation in the US forcing airlines to promptly refund customers for flight delays and cancellations has had negligible effect on the cost of running the airline, undermining Australian carriers’ arguments against such rules.

A year after the Biden administration cemented into law speedy refunds for passengers hit by excessive cancellations, Kirby said the impact on profits had “been minimal so far”, citing the existing policies of the airline for passenger remedies. In 2024, United flew 700,000 passengers between the US and Australia.

The cost of compensation for cancelled and delayed flights has become a hot-button issue for airlines in Australia as well after the country’s Aviation White Paper in 2024 called for an Ombuds Scheme with the “power to direct airlines and airports to provide remedies to consumers”.

Qantas’ retention of customer flight credits in the aftermath of COVID lockdowns and travel restrictions has further infuriated the public, putting pressure on the Albanese government to intervene.

The US now requires airlines “to promptly provide passengers with automatic cash refunds when owed”. The toughened rules come after a period of significant and costly flight delays for American travellers.

In one of them, the US government imposed a $US140 million ($216 million) penalty on Southwest Airlines for violating consumer protection laws over a system meltdown that stranded thousands at Christmas. That fine was in addition to the $US600 million in reimbursements Southwest paid to customers.

Kirby said most situations forcing delays and cancellations for his airline today were driven by air traffic control problems. “Even on days last year when it was clear, blue sky, days, 68 per cent of our delays were because of air traffic control,” he said.

On April 28 and May 10, air traffic controllers at New York City-hub of Newark Liberty lost contact with planes for 30 to 90 seconds with approaching and departing planes.

The airline boss denied the problems with the Federal Aviation Administration were doing “brand damage” for the US, noting the problems are “decades old”.

“Controllers are understaffed,” Kirby said, but US Transport Secretary Sean Duffy and the FAA was “committed now to giving the US the world-class aviation system that it deserves”.

Chris Zappone travelled as a guest of United Airlines.

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