MGM Grand Air to Add Coach Class in August : Airlines: Some say the move may hurt the all-first-class carrier’s marketing image.

MGM Grand Air, the airline that has created a niche as an ultra-luxurious way for the wealthy and famous to travel on all first-class planes between America’s coasts, will add coach class this summer, the company announced Monday.

But passengers in the two classes won’t even see each other, the airline’s president claimed.

The new service will begin on Aug. 16 when the carrier puts its three newly acquired DC-8 Super 62 airliners into service. Until now, the airline, founded in 1987, had flown between New York and Los Angeles with Boeing 727s outfitted with private compartments, a stand-up bar and swivel seats.

Some observers maintained that, by adding coach class, the airline will give up some of its novelty. “MGM Grand provided passengers the opportunity to travel incognito,” said Hans J. Plickert, an analyst with the Transportation Group, a company affiliated with Paine Webber, a New York brokerage house. “Putting coach in dilutes its positioning and marketing image.”

Charles L. Demoney, president and chief executive, said Monday in a telephone interview that the airline’s original “grand class first” will become even more luxurious and that its new “grand class coach” will be the equivalent of first class on other coast-to-coast carriers.

“We have carefully structured this new dual-type service to protect the exclusivity of grand class first passengers,” Demoney said. He added that passengers in the two classes would board through different doors from different lounges and would not see each other. The planes are designed so that “never the twain shall meet,” he said.

The grand class first section will have two private rooms. The fare for the rooms will be the equivalent of four fares and can be used by from one to four people.

The DC-8s will be configured to carry 40 passengers in coach class and 39 in first. The 727s carried 34 persons in its single class.

The 727s will continue to be used as charter aircraft for such customers as sports teams and entertainment groups. The airline will also try to develop its cargo business, using the DC-8s’ larger cargo holds.

The DC-8s’ coach class will have seats two abreast. Every two seats will have a television monitor and a telephone. The coach class will have seats 22 inches wide--six inches more than conventional coach seats.

Coach fares on MGM Grand Air will be $623 one-way unrestricted. American Airlines, asked for a comparison, said its coach seats cost the same, though it does offer a few discount fares as low as $477. Flights in MGM Grand Air’s luxury section cost $1,067 one-way, comparable to first class on competing airlines.

Few U.S. airlines still use the DC-8 in commercial passenger service, but many of the Douglas Aircraft planes are used in cargo operations and charter service. One source close to the airline said Monday that the DC-8s are interim planes to be used only until MGM Grand acquires a new fleet. The DC-8s, which are being purchased from a leasing company, were once part of the fleet of Italy’s Alitalia Airlines.

MGM, Demoney said, had become profitable and earned $360,000 in 1989, a $5-million improvement over the previous year. During 1989, its planes flew on the average of 73.9% full. That figure would drop, he said, with the 200% increase in capacity when the new planes are introduced.

The airline’s majority shareholder is Los Angeles financier Kirk Kerkorian.