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In a sign that Australian business travel is undergoing a plush little renaissance, premium economy is no longer just the middle child of air travel—it’s now the golden child. And it’s not just because of the free fizz or extra elbow room.

According to fresh data from Corporate Traveller—the SME-focused arm of Flight Centre Travel Group—bookings for premium economy seats by business travellers have surged a whopping 35 per cent year-on-year in the March quarter of 2025. That’s even though fares themselves have nudged up nine per cent. When it comes to jetting off to London or LA, Aussie firms are deciding that comfort, productivity, and staff wellbeing are worth their weight in Skywards Miles.

Corporate Traveller Global – Managing Director, Tom Walley.

“Lowest airfares are no longer the number one priority for business travellers,” says Tom Walley, Global Managing Director at Corporate Traveller, in what may be the understatement of the aviation season. “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.”

And he’s right. Long gone are the days when travellers willingly sandwiched themselves into 34-inch legroom torture chambers in the name of frugality. These days, companies are realising that turning up to a Shanghai summit groggy and bleary-eyed is hardly conducive to signing multimillion-dollar contracts.

Sweet Spot in the Sky

Let’s break it down. In Q1 2025, the average return fare out of Australia in premium economy hit $4,495—a tidy nine per cent jump from the previous year’s $4,115. By contrast, business and first-class fares have gone the way of Sydney property prices: up, up and away.

That’s what’s giving premium economy its shine. It offers more legroom, better food, and enough recline to avoid an osteopath—all without the eye-watering sticker shock of business class.

This travel trend isn’t just for the usual suspects, either. According to Corporate Traveller, it’s industries like manufacturing, IT, construction and finance that are muscling into the cabin—and they’re not doing it for the champagne. Comfort, yes. Productivity. Image? Well, that never hurts either.

Singapore Airlines Takes the Crown

So, who’s doing premium economy best? In a recent survey of Corporate Traveller’s frontline travel advisors, Singapore Airlines was crowned king of the cabin, followed closely by homegrown hero Qantas and the ever-innovative Air New Zealand.

That said, the survey didn’t let airlines off the hook. Many of the travel advisors said there’s still plenty of room for improvement, among the most-requested features: access to business class lounges (yes please), wider seats, deeper recline, better privacy partitions and—shockingly—more legroom. Passengers have tasted the good life and want more than just a bigger tray table.

Comfort: The New Currency of Business Travel

Perhaps the clearest sign of changing times is the fact that premium economy’s popularity aligns with a broader trend: valuing restfulness in transit. A perfect example is Air New Zealand’s soon-to-launch “SkyNest” pods—lie-flat bunk beds in economy class slated for a 2026 debut. When even the economy is getting lie-flat options, you know comfort is no longer a luxury. It’s a business tool.

“Benefits that focus on genuine comfort, restfulness and not just priority boarding or meal upgrades are what today’s travellers value most,” says Walley. “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.”

In other words, a $400 saving isn’t worth much if your CFO lands in Singapore looking like they’ve been sleeping on a baggage carousel.

From London to Las Vegas: Where They’re Flying

The top five premium economy destinations booked by Aussie businesses in 2025 read like a global CEO’s diary: London, Singapore, Los Angeles, Las Vegas, and Shanghai. All long-haul, all exhausting, all the more reason to be horizontal—or as close as you can get without flying business.

The traditional travel cost equation is being rewritten. Where once every cent mattered more than a good night’s sleep, modern corporates are choosing wellbeing over bean-counting.

The Bottom Line

With travel budgets still recovering and the global business environment humming, premium economy is proving to be more than a fad. It has become the new battleground for value, where comfort meets cost efficiency, and companies are making savvy, sustainable choices.

So the next time you see a suited traveller reclining a little further than expected but not sipping Dom Pérignon, don’t scoff. They’re probably flying premium economy—and making the most sensible business decision of the quarter.