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A Final Word for 2004…

I was thinking about doing a Top 10 predictions for 2005, but I thought I’d just pass along one useful piece of advice:  If you have US Airways Dividend Miles, please book a ticket on a partner airline.  My number one prediction was going to be that US Airways will liquidate.  If that happens, the miles are gone.  I cannot promise if US Airways goes under that partner airlines will honor the free tickets, but I do know that if you book a free ticket on US Airways, it will be gone.  So even if you don’t have a trip planned, please please please book a ticket on United or Lufthansa (preferably the latter) and give yourself a shot at getting something for the miles.

OK fine, here’s my Top 10 predictions for the year.  And please don’t go back and look at these 12 months from now…I may be completely wrong.

1) US Airways will shut down.  I really feel terrible about this, as, especially on the east coast, US Airways has a long history dating back to when it was Allegheny and Piedmont.  This will be a blow to several local economies, and it will put lots of people out of work.  Almost as bad, it’s not enough capacity to really impact the industry enough in a positive way.

2) Fares will go up.  We’ve already started to see this on transcon routes (for most of this year, you could fly transcon for $200.  Not so much any more), and it will become more widespread.  It won’t be enough to bring airlines out of the red, though.

3) Indepdence Air will go back to being a United feeder.  Fly-i just underestimated the power of the majors’ frequent flyer programs…and I think people kinda hate the regional jets.

4) United will not disappear.  I think they’ll emerge from bankruptcy mid-year and be on the brink of returning to bankruptcy then-on.

5) Continental will start charging for meals.  They were the last holdout, and with Gordon Bethune gone, so too will be the "meals at mealtime." 

6) United’s P.S. experiement will be a success–and we’ll see the majors match.  United has taken a huge step to differentiate their transcon product and they’re actually able to charge a bit more for it.  Somone else (Delta?) will jump on this and also offer a premium product transcon.

7) First class fares will continue to be reasonable.  There has been a HUGE change in first class fares, especially transcon—for $1200 you can fly coast-to-coast up front.  Six months ago you couldn’t buy a coach ticket last minute for that price.

8) Virgin America will be a huge success immediately (like JetBlue).  Or they won’t launch in 2005.  I’m not sure.

9) There are a bunch of business plans for lowfare carriers to Europe floating around.  One of these will launch in 2005.  And fail.  Because 10 months of the year you can fly from NYC to London for $99.  How much lower could it be?

10) First class seats will continue to disappear off airplanes.  Continental has been removing first class seats from its 757-300s, aircraft used primarily on leisure routes.  Airlines have been moving toward differentiating its leisure route product (Song, for example); Continental is doing this by removing first class seats from these aircraft.

There ya go…Happy New Year.  And book those tickets using Dividend Miles.

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