Air N.Z. Expects to License Out ‘Cuddle-Class’ Seats by Year End

Air New Zealand Ltd. (AIR) expects to reach the first agreement for licensing out its “cuddle-class” coach seats by the end of the year as passenger demand for the units helps bolster long-haul ticket sales.

The airline has had talks with about 12 carriers interested in the Skycouch seats and it is close to getting the final certification needed to license them, Chief Executive Officer Rob Fyfe said in an interview yesterday at the International Air Transport Association’s annual meeting in Beijing. The unit, developed by the Auckland-based carrier, converts from a three- seat set-up into a bed for two.

“We won’t offer to other airlines unless they are prepared to pay us a rich amount of money,” Fyfe said. A deal may be in place “towards the end of the year,” he said. Air N.Z. paid “several million dollars” to license a business-class seat design from Virgin Atlantic Airways Ltd., he said.

Air N.Z. may also fit more of the seats onto its own planes because they sell 30 percent quicker than standard coach tickets and generate higher yields, Fyfe said. The airline began flying Boeing Co. 777s fitted with the seats last year to help compete with Emirates Airline and Singapore Airlines Ltd. (SIA) on long-haul routes.

--Jasmine Wang and Andrea Rothman. Editors: Neil Denslow, Garry Smith

To contact Bloomberg News staff for this story: Jasmine Wang in Hong Kong at jwang513@bloomberg.net; Andrea Rothman in Toulouse at aerothman@bloomberg.net

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net

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