Monthly Archives: December 2010

5 Things We Learned about Airlines in 2010

It’s year-end wrap-up time, so I thought we’d take a look at the 5 things we learned about airlines this year:

1) Mergers do not have to be a failure.  Seemingly forever, an airline merger was often a signal that two weak airlines were jamming themselves together with hopes of being able to take on more established airlines that way.  The complexities of the merger often doomed that strategy.  So when Delta and Northwest announced their merger, all signs pointed toward a mess.  We were all wrong.  The combined airline has a global route network with reach we haven’t seen since Pan Am, and a domestic network that, unlike Pan Am, will allow it to thrive.  Add to that solid labor relations and it looks like we have a winner (despite the fact that every frequent flyer complains about SkyMiles).  Continental and United look like they’ll also have a winning mix when they’re combined as well (Continental was very strong heading into that merger, and United was most definitely on the upswing).  It still feels to me like we have one more larger merger coming (US/AA or AA/AS) and that’ll be it for a while. 

2) Airlines do not need to drive prices down to be successful.  For years, the knee-jerk response to any competitive action in the industry was for a competitor to drive down prices.  This worked as long as fuel was cheap and they were able to drive up prices for business travelers.  That was successful in that it made passengers think that a roundtrip transcon ticket should cost $200, and it made business travelers hate the airline industry for charging $2000 to fly from Newark to Dallas.  For the past 2 years, airlines have tried a different approach, keeping higher end fares a bit more reasonable (in most markets), and generating more revenue off the low-end travelers by charging fees for various items (discussed ad nauseum).  This is a successful strategy, keeping frequent travelers a bit happier (as they are not being screwed on fares quite as much), while generating more from the person flying on a $200 transcon ticket.  Passengers can complain all they want about fees, they still pay them (ask Spirit, which was profitable even during the darkest days of 2008). 

3) Southwest is no longer a “low fare airline”.  One of my pet peeves of lazy business writers is when they refer to Southwest as a “low fare airline” or “no frills airline.”  All airlines are low fare airlines, as they generally offer the same fares when in direct competition (usually, not always).  And Southwest offers roughly the exact same frills as every airline, except that they don’t charge for bags, which actually suggests to me that they are a high-frills airline.  Southwest is not the same airline they were 15 years ago.  They no longer focus on secondary markets, and they have introduced several strategies that suggest they are going after business travelers at least as much as they are targeting typical fare-conscious leisure travelers.  In fact, because they have tried hard not to wring every last dime out of their passengers over the years, they have actually been able to charge a premium over competitiors in some cases, since people assume Southwest is charging them a fair price.  Southwest has last minute roundtrip fares well in excess of $1,000 on many routes – that’s hardly low fares.  It works for them, and their customers are happy; but stop calling them a low fare carrier.

4) The jury is still out on in-flight Wi-fi, and if I had to guess, we won’t see much more uptake than we have now.  Continental has canceled their wi-fi plans.  JetBlue has kept it to their one plane.  The industry seems ambivalent about in-flight wi-fi.  While customers who use it (especially on tech-friendly Virgin America) are happy with it, uptake rates are low and airlines are now focusing on rolling out in-flight TV at the expense of in-flight wi-fi.  As I heard some airline exec say — only some people have laptops with them, but everyone can watch TV.

5) US Airlines are focused on making their international premium classes just good enough, not world class.  And that’s fine, so please stop complaining about it.  Continental, United, Delta, US Airways and American have all begun the process of installing flat-bed seats on some of their premium cabins on international routes.  No matter what they do, they will not be putting in first class like you see on Singapore or Emirates.  Their service will not be as polished, and their food will not be as extravagant.  Get over it.  Their premium cabins are headed in the right direction and, compared with those other airlines, they are priced where US travelers are willing to pay for them.  You want to pay (hahahhahahahha) or use your miles on an alliance partner, enjoy!  But it’s time to stop complaining about the premium product.  The airlines have made it exactly as good as it needs to be to stay competitive.  If you were running their airline, you’d do the same thing.

As a final wrap up, Gary Leff at View from the Wing wrote something to me earlier this year that’s stuck with me.  He said something to the effect of:  It requires so little work to make your traveling experience so much better.  Meaning, there are plenty of ways to get Elite status for free or almost no flying (Aegean Airlines, thanks), allowing you to board first and check your bags for free.  Marriott is offering free Gold status right now.  The 100,000 mile BA credit card.  I just spent a night (and a flight) for free at the Mandarin Oriental Las Vegas with the Expedia Canada deal.  And on and on.  These deals come up all the time.  Paying even a small amount of attention can make your flying life so much better.

Have a great new year, and we’ll see you in 2011.

Save 10% On Air France Flights to Europe

Air France is offering 10% off flights to Europe when you book by January 31st, and fly by March 31st.  Here’s how:

– Book at airfrance.us

– Enter code WINTER925 during checkout.

Easy enough.

Congrats, TSA! You Found My Liquids!

When the TSA announced its rules about carrying liquids on planes, I decided that I would silently protest the ridiculous requirements by never taking the liquids out of my luggage.  TSA has helped my cause by never scanning my carry on and then asking me to remove the liquids.  Until today.

But first, a clarification.  I have twice removed liquid from my luggage:

Time 1:  The TSA agent in Springfield, Illinois, was so unbelievably nice on a flight in 2006 that I decided to take out my liquids in advance.  She didn’t even ask, but she was so courteous and wonderful that I wanted to return the favor by actually removing the liquids from my bag.

Time 2: Also in 2006 we were traveling with our girls (then infants), when the TSA agent at Newark Airport asked us to throw out the baby food we brought for them.  Susan had to talk me down, as I was pretty sure I was about to be arrested for my response to that request.

Now, I fly 50-60,000 miles a year, meaning that since 9/11 I’ve probably flown 500,000 miles without being asked to remove my toothpaste and whatnot. Until today.  The eagle-eyed TSA fellow at Cincinnati’s Terminal 2 saw my toiletries on his scanner and asked me to remove them, place them in a plastic bag, then re-run them through the machine.  I’m not sure I understood the entire thing, but I felt a bit like Jean Valjean after he was finally confronted by Javert.

A New Tool for Bidding Help on Priceline

(Thanks, Gary!)

It’s not an airline thing, but many of us who fly a bunch are often looking for a great deal on a hotel.  Those of us who use Priceline for those deals have either happily used Betterbidding.com for help with what to bid, or suffered through the rather touchy administrator over at Biddingfortravel.com.  Now, there’s a new tool that makes a giant leap forward with how to bid on Priceline:

Check out BiddingTraveler.com – this new site has you city, zone, date and # of stars (as if you’re bidding on Priceline), and it brings back a Priceline-type map with the hotels and what people bid (both winning and losing bids), with differentiation between weekend and mid-week stays.  While Betterbidding is great, BiddingTraveler.com really does take it a step further, making it much easier to figure out what you should bid and what you’ll get.

On the other hand, they have also posted this blog entry which basically contains a dissertation about Priceline re-bidding strategies.  To each his own.

Are Passengers Flying on Reward Tickets Entitled to the Same Treatment as a Revenue Passenger? (Or: Do the Airlines Owe Us Anything?)

I’d like to preface this post by saying (as I have said here before) that I have only the highest level of respect for my fellow bloggers writing about the airline industry.  There are a handful of people out there (Lucky, Gary, Brett, Mark, others) who have devoted an enormous amount of time and energy to sharing their expertise to their specific niche in the airline world (some focus more on the operational aspects of airlines, others on the frequent flyer programs).

All of us have written trip reports at one time or another, sharing, with various levels of specificity, the minutia of the travel experience.  One thing that we have in common, though, is that when we write about the more exotic travels on our itinerary, we are most frequently flying on reward tickets.   I’ve been pretty vocal here about how I believe we’re in a golden age where we can pretty much fly wherever we want on the planet for free by accumulating miles through a wide-ranging set of activities that often don’t even involve flying.

Which brings me to a question that’s been eating at me a bit:  do we have any right to complain about any aspect of reward travel?  I’m extremely torn.  The airlines should be providing a consistent level of service, and they should be clear about what passengers should expect in terms of service.

But if we’re on a reward ticket, should we have that same expectation?  Is it a legitimate complaint if your business class meal wasn’t up to snuff if you’re flying on a ticket earned by opening a credit card or two?  Should we just be happy that we received safe and relatively on-time air transport?  Should the airlines just give us a seat on a reward ticket and make us pay for in-flight amenities?  Would you pay fewer miles if your reward ticket didn’t include food and drink?

Do we have a right to complain if an airline doesn’t make “enough” seats available for reward travel (at least at the base redemption level)?  Not to call out Lucky (who, I can’t say enough, is pretty brilliant about this whole thing), but he did say a couple of weeks ago that he found Singapore Airlines to be “arrogant” for blocking award redemption on SkySuites on their A380s.  Is that arrogance?

The airlines created their loyalty programs and gotten us hooked.  But do they really owe us wide open low-priced redemption options?  Do they have a right to say, “y’know, we’re actually not going to allow any low-priced redemptions to Europe during the summer.  If you want to use miles then, it’ll cost you double.”  They raise their airfares during the high season and few would begrudge them the right to charge $1,000 for a flight to London in August; why don’t they have the right to block out cheap reward seats?

Of course, it’s great when airlines offer wide open availability in premium cabins on international travel as reasonable redemption rates with unlimited stopovers.  Who wouldn’t love that?  But if an airline doesn’t offer that (or, God forbid, an airline did offer it and then changed their rules), are they horrible?

In other words, if Delta’s much reviled SkyMiles program is wildly popular (and the airline’s resurgence since their merger with Northwest certainly suggests it’s not keeping people away), are they smart to keep their low mileage rewards very restricted while offering two other levels of redemption?  Are all the other airlines making a poor business decision by giving away more seats at lower levels?

Should carriers differentiate based on how you earned your miles?  Should they separate miles in your account by whether you earned them from flying or by other means?  Should that affect redemption opportunities?

Honestly, I don’t know the answer.  I feel like we expect an awful lot from frequent flyer programs while giving airlines very little in return.  And that’s fine.  I’m just wondering if our expectations are just set a bit too high.  Or maybe not.

From WikiLeaks: An American Airlines Crew Is Kicked Out of Venezuela for Calling Hugo Chavez “Crazy” (though they didn’t actually say that…)

A cable in the Wikileaks leak details an incident in Caracas, Venezuela, in 2008 when an American Airlines flight crew was kicked out of Venezuela after a passenger thought he heard the captain say that President Hugo Chavez was crazy.  In reality, upon landing the captain made an announcement, saying, “Welcome to Venezuela.  Local Chavez time is” X.  A passenger on the plane – a friend of a friend of Chavez’, reported that the captain said “loco Chavez time” not “local Chavez time” (Chavez had recently had the clocks in Venezuela set back half an hour).

Venezuelan immigration authorities butchered the whole thing even more when they made a report that the captain said, “the hour of the crazy Chavez and his women,” which doesn’t make any sense at all.

A whole mess of phone calls were made and, in short, the crew offered to get back on the empty plane and leave the country immediately.  Venezuelan officials accepted, and they departed without incident.

Own a Share of an Emirates A380

Ever wanted to own an A380, but you were nearly $200 million short?  Me too.  But now you’ve got your chance.  Kind of!

A company called Doric Nimrod Air One (sorry, reg req’d) was listed on the London Stock Exchange today, a fact that I mention here because the company’s only asset is 1 A380 that will be leased to Emirates.  Now you can buy a share in that A380 for just a few dollars.  Of course, you can’t actually fly on it (well you can, you just have to buy a ticket), but you can get some of the financial benefit not generally seen by airlines — you may actually make money.  In fact, according to the company, they believe the stock will offer a return on the investment of about 9% annualized.

British Airways Offers 20% Mileage Rebate for Cardholders

British Airways is offering a 20% mileage rebate to BA Visa cardholders for trips booked using miles.  Book your BA flight using miles before January 20th, 2011, for trips through October 28, 2011, and they’ll refund back to your account 20% of the miles you used.  The offer isn’t good on codeshares – it needs to be on BA metal.  Except for their insane fuel surcharges, it’s a great deal.

Qantas Flight Delayed an Hour Because of Cheetah

A quick goofy one this morning:  A Qantas flight from Melbourne to Adelaide was delayed on Wednesday when crew members had trouble loading a cheetah into the cargo hold of the plane.  The cat was being flown from a zoo in Perth (via Melbourne) to another zoo in Adelaide.

Bagel in Salt Lake City Airport: $3.89

I really have nothing more than that:  Starbucks in the Salt Lake City Airport was charging $3.89 for a bagel when I walked by yesterday.  $3.89.  For a bagel.