Southwest Airlines has announced a tentative merger/purchase agreement to buy Airtran Airlines for $1.4 billion today and, yes, I was completely surprised.  It’s a bold move and offers SWA huge access to Atlanta and competition Delta Airlines (who I imagine has already opened up the desk drawer and taken a swig of antacid this morning).  It offers more access to the NYC and Washington DC areas, too.   And it brings that international experience to the table as well.

As much as this is about growth and access to new markets, it’s also about eliminating some damaging competition in other markets.   SWA and Airtran are already beating each other up in the North East and in Milwaukee.  It was soon to be only a matter of time before the bumped heads elsewhere too.   This is as much about Southwest elimating that distraction and allowing it to focus on competing with the SuperLegacy airlines.  More tomorrow.

Filed under: Airline News by ajax
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You’re surprised, right?

The Chicago Tribune has a story on airline objections to baggage fee refunds and how most airlines are reacting to a proposed federal rule that such refunds be available.  The Airline Transport Association says this should be determined by the marketplace, not the federal government.  It claims that mandating such a thing will raise fares on everyone and a determining what constituted a timely delivered bag was subjective at best.

The ATA sounds like a political party at this point.  Actually, it sounds like the Republican party at this point.  No regulation!  No Rules!  No Taxes.  Leave Us Alone!  Get off our lawn!

I’m pretty sure I could determine what constituted a timely delivered bag.  If it is at the baggage carousel available for my pickup in no more than 60 minutes, it’s timely delivered.  (I’ll point out that this is more generous than Alaska Airlines at present.) If it isn’t delivered to me in a timely manner, my fee is refunded in the manner of payment I originally used for such a fee.  

Hey, if you want cake and you want to eat it, be prepared to pay for it.  It doesn’t come free.  It’s time even airlines get that message.  Don’t like the infrastructure such a rule might impose upon you?  Figure it out.  

Airlines earned over $3 Billion with a “B” in baggage fees between June 2009 and June 2010.  I know they love that revenue and I know it’s making a difference in their profits.  Thing is, if you charge a fee for something, you *should* be held to standard of performance.

Offering some points or making it incredibly difficult to obtain a refund falls short of a performance standard that anyone would find acceptable anywhere else.

And let me comment on this idea that the marketplace should determine this concept.  Bah!  We don’t have a free marketplace in the airline industry.  We have an ever increasing oligopoly that competes with itself on price but which cooperates in signaling policy behaviors on just about every other subject. 

Even restaurants have to operate within health standards and dry cleaners get to pay for what they lost.  Why should airlines be exempt from this?

Filed under: Airline News by ajax
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