The trend: Airlines are leaning on higher-income consumers to sustain growth at a challenging time for the travel industry, with jet fuel prices up 92% since the start of the war in Iran, per Airlines for America.

The details: Delta Air Lines’ premium offerings accounted for 43.6% of the company’s Q1 revenues, as premium revenues rose 13.9% YoY to $5.36 billion. That’s up from 41% a year earlier, reflecting the airline’s shift toward more premium seating. CEO Ed Bastian said bookings remain strong across premium and corporate travel, noting that “the premium consumer is candidly immune, or becoming more immune, to the headlines.”

United is doubling down on premium travel by increasing both the number and quality of high-end seats—adding Polaris lie-flat and premium economy seats, while introducing new ways to monetize these offerings. It is also rolling out tiered pricing (Base, Standard, Flexible) for Polaris and Premium Plus, lowering entry prices while charging more for add-ons like seat selection, baggage, flexibility, and lounge access.

American Airlines is also ramping up its premium strategy, adding new Flagship Suites featuring lie-flat beds and privacy doors. The airline plans to increase premium seat capacity by 30% for its domestic fleet and 50% for long-haul aircraft by 2030.

Why is this happening? Delta has led the shift toward premium offerings to boost profitability, and others are following. While United's and American’s fleet overhauls aren’t a direct response to the war in Iran, the uncertain environment underscores why those initiatives matter.

While Delta owns a refinery that converts crude oil into jet fuel and other products, such as gasoline and diesel, it still expects to incur more than $2 billion in additional fuel costs through June due to the war. That’s driving it to take other steps to boost its bottom line, including increasing fares, trimming capacity, and raising checked bag fees.

Implications for the travel, hospitality, and retail industries: Airlines’ premium push may help offset some pressure from rising input costs, but it also highlights a growing divide in travel demand. While higher-income consumers continue to spend, a broader swath of travelers is pulling back. Already, a third of US consumers say they don’t plan to travel this year due to rising costs, according to a YouGov survey commissioned by The Points Guy. That pullback will ripple across the travel, hospitality, and retail industries, as fewer travelers mean less spending on hotels, dining out, and tourist-area shopping.

The fallout appears to be affecting cities hosting World Cup matches, which had been banking on a spending bump from the event. Hotel associations in New York City, Philadelphia, and San Francisco told Forbes they haven’t seen a surge in demand so far, with Vijay Dandapani, president and CEO of the Hotel Association of New York, saying forward hotel bookings in June and July are virtually identical to the same period last year.

If higher travel costs persist, the reliance on affluent travelers may not be enough to offset broader softness.