Update (16:30 CDT):  Spirit has now cancelled flights through Thursday.  No signs of any reconciliation between the pilots and the company.

Spirit Airlines pilots went on strike starting with flights on Saturday and the latest news says that flights are cancelled at least through Wednesday.  So far,  I cannot discern that any resolution is imminent either.  Since Spirit serve a very small portion of the US and since manyof its flights are Caribbean and Latin American in nature, the President will not be calling an end to this strike and bring both parties to a table. 

This has got to be hurting Spirit badly financially and from what I hear, they don’t have a whole lot of cash on hand to withstand the strike.  In addition, Spirit made some noise in the days leading up to the strike that they would try to cotinue as many flights as possible using either management pilots or through hiring other airlines to fly their routes.  Not only did that not happen, it doesn’t appear as if there were any plan of any kind to do this.  It isn’t good to lead your customers on like that.

The pilots wants a “fair” contract and, in this case, fair is what the other guy is earning.   But who is the other guy?  Is it a Delta pilot or an Airtran pilot?  A Southwest pilot or a jetBlue pilot?  The current offer on the table brings Spirit pilots to about par with Airtran and they still don’t like that.  It is notable that Airtran pilots aren’t even happy with that anymore as they’ve had a strike authorization vote recently themselves. 

In addition, another part of the offer gives these pilots a minimum 0f 4 days between trips and that is kind of unprecedented as a part of a contract and, to me, seems to be a huge quality of life gain.  At the end of the day, I can’t figure out what would make the pilots happy (they sure aren’t talking specifics in the public media) and I’m beginning to think that Spirit’s management can’t figure it out either.  Unless it’s just a whole lot more money than on the table right now.

If so, then I think there are going to be two losers in this strike.  Spirit is privately owned and while they’ve made a profit, the owners aren’t interested in pumping more money into the airline than they already have.  These are venture capitalists and those guys know that sometimes its best to pull the plug and find something else to do with the assets.  Spirit’s management doesn’t have anything to lose by remaining steadfast with their current offer.  If they offer more, they’ll likely become unprofitable (this airline really is an Ultra Low Cost Carrier) since part of their model is keeping costs like labor and fuel as low as possible.  If they become unprofitable, the owners will likely pull the plug there too.

Spirit pilots are high risk for losing their jobs . . . permanently.  There are only so many days that Spirit can survive before it declares bankruptcy.  Once it does, it isn’t likely to come back in some form and that means those pilots now have to restart their careers somewhere else.  It is notable that there isn’t a whole lot of hiring going on among airlines these days.   To a certain extent, you have to accept that when you work for a LCC or ULCC, you’re not going to earn premium salaries no matter who you are and no matter what is happening elsewhere in the industry.  Rising to Airtran standards seems not too bad all in all particularly when consider the quality of life issues that are also getting addressed.

Yes, the pilots have been trying to amend their contract for over 3 years.  Yes, that seems like a long time.  No, it really isn’t a long time when you look at pilots and their negotiations at other airlines.   Is it fair to take so long? No, not in my opinion but that is the fault of the Railway Labor Act, not the airline(s). 

In this situation, I think a bird in the hand is a whole lot better than a pink slip and I think that pink slip could arrive as early as this coming Friday.  Spirit has some cash but the owners are wise enough, I suspect, to realize that preserving that cash is a better idea than it is to hold out against a long strike.

Filed under: Airline News by ajax
No Comments »

Apparently the nation’s airlines have decided that their best strategy is to add yet another fee for this summer.  This time it’s a peak travel surcharge.  See the CNN story HERE.  The question is, will it work?  Would you pay from $10 to $30 more over the published fare for a ticket this summer?

I wouldn’t.  Quick research on my favorite routes show the fares are already climbing rapidly and in two cases have nearly doubled for the least expensive ticket.  The economy hasn’t recovered, people are not earning more and unemployment is still exceptionally high.   I think air fares are very inelastic in price for consumers this summer if only for the leisure travelers. 

Capacity is still way down and clearly the airlines think they can earn more and not lose traffic.  Maybe they’re right too.  But I like to do a bit of content analysis on for sale ads from time to time to gauge where we might be when it comes to disposable income.  If you take a look at the ads online someplace such as Craigslist and see what’s being sold and at what price, you can often get a reasonably good feel for whether or not people feel they have enough income for luxuries.

Right now, I see a lot of firesales on goods.  Nearly new televisions, computers, appliances, etc. tell me that people are still trying to make do or survive.  I suspect a lot of people will defer travel for their vacations this summer in the end.  Advance bookings were strong in March and April, yes.  Prices were also exceptionally low in March and April.  A round trip flight from DFW to MKE in late July has climbed more than 20% in price already and that is on a hyper-competitive route. 

Will the airlines “stick together” on these surcharges?  I think someone might break in a week or two.  Unlike most fees, these surcharges are showing up in booking engines and it is quite possible one or more airlines might “break” from the pack as soon as sales soften.   In addition, while the legacies are doing this, the LCC’s aren’t showing many signs of adopting it yet except Airtran who did choose to add a  “flate rate” surcharge of $10 for 25 days in the period marked from June 10 to August 22.  Once again, Airtran acts a bit smarter.

Time will tell but I don’t see us enjoying a summer where all economic signs point to consumer confidence.  As I write this, the stock markets have had a big sell off over fears of volatility in Europe with respect to weak economies and a weakening Euro.   Unemployment rates haven’t made a real reversal in direction.  Gasoline prices are a bit up and food prices are too.  It’s doesn’t take much to reduce the disposable income of an average household and uncertainty means most will play it safe rather than just “accepting” yet another fare hike.

Filed under: Airline Fees, Airline News by ajax
1 Comment »

Due to the building midestern winter storm that is already gaining strength, airlines are, once again, waiving change fees to diminish the impact of looming cancellations and delays. 

 

For a list of airlines and details on their current policies, visit USA Today’s Today in the Sky blog HERE.

 

If you have any flexibility at all, consider attempting to depart on your flight early or, perhaps, re-routing yourself through a connection in a city likely to be unaffected by the weather.  Considering the current weather picture and current forecast, hub cities such as DFW, Houston, Atlanta, Phoenix, and Denver. 

 

Hub cities such as Denver, Chicago, Minneapolis, Detroit, Cincinatti, and Cleveland are all likely to be affected at least somewhat by the looming weather over the next few days.   Based on that, airlines likely to be most affected might be  Delta / Northwest Airlines (Minneapolis, Detroit), United Airlines (Chicago and Denver), American Airlines (Chicago), Airtran (Milwaukee), Southwest (Minnesota, Wisconsin, Illinois, Colorado, Michigan), and Continental (Cleveland).

 

Hint:  If you are a member of a frequent flier program, see if there is a dedicated phone number you can call.

 

Hint:  Make sure your cellular phone is charged and you have your charger in your carry on luggage.

 

Hint:  If you have a laptop computer, consider traveling with it in your carry on luggage.

 

Hint:  If you are seeking to re-route yourself, explore options among codeshare partners with your airline when speaking to a reservations agent.

 

Hint:  If you must board and travel on a flight in a city being affected by the storm, purchase some snacks and water in the terminal to take on the aircraft with you.

 

You can review all travel hints by clicking HERE.

Filed under: Airline News, Travel Hints by ajax
No Comments »

At the first of the year, I wrote 3 blog posts shown HERE, HERE and HERE.  It was really just my random speculation on what to expect over the next 12 months.  Well, now it’s December of 2009.  Let’s see how I did.

 

Boeing 787:  I guessed at an April 2009 first flight.  It still hasn’t flown although speculation has it flying this month either by December 14th or December 22nd. 

 

Airbus A380:  I guessed they would make their goal of producing 21 aircraft this year.  As of November 30th, 2009, Airbus says they have delivered 7 A380 aircraft this year.  Ouch.  This is a program that is in financial trouble.  No, I don’t think it will be cancelled.  Not yet but please don’t try to tell me this program will make a profit. 

 

My deathwatch had Midwest Airlines going away most likely by a sale.  That did happen and while the airline has essentially evaporated (from its original form), it does remain as a brand being run by Republic Airways.  

 

I speculated that Frontier Airlines would be bought out of bankruptcy but I guessed that jetBlue would be the buyer.  In fact, Southwest Airlines and Republic Airways were the suitors and Republic won.

 

I thought that United Airlines and US Airways would announce a new merger with Continental a dark horse candidate for buying United.  In fact, Continental became a member of the Star Alliance and firmed its relationship up with United but wisely kept its distance otherwise. 

 

I said that Southwest Airlines would maintain its status quo but that Gary Kelly would be under fire from both employees and outsiders and he was.  However, that view is already being reversed again by Southwest’s resurgent strength in the business.

 

I thought that the Middle Eastern airlines such as Emirates, Etihad and Qatar wouldn’t see a bankruptcy or merger but would slow their growth and aircraft deliveries.  That, in fact, has happened and now we see Emirates working hard to distance itself from Dubai World’s financial woes.

 

China:  I said deferred orders.  Pretty much what happened.

 

The Far East:  I said airlines from that region would maintain their status quo, probably would not defer orders and might make new orders to replace existing equipment for greater effiency.  Again, pretty much what happened.

 

Australia:  I saw QANTAS slowing growth, deferring some orders and fighting hard against new entrants.  Again, that’s pretty much what happened.  I also saw two weak competitors on the US-Australia routes:  United and V Australia.  That is pretty much what is happening although V Australia has been pretty smart in working into a relationship with Delta where it appears the two airlines will cooperate with codeshares.  United remains alone and with weakening demand.

 

South America:  I said the Argentine government would take Aerolineas Argentinas back from Grupo Marsans and the airline itself would muddle along or contract rather severely in some areas.  Bingo.  Exactly what happened.  I also predicted Azul would become the jetBlue of Brazil and its not hard to guess that that airline is pummeling its competitors.  A future prediction was for the airline to fly internationally in 2014 with Airbus equipment.  We’ll see.

 

Africa:  I saw Delta continuing to pursue flights to major African cities (true) and SAA (South African Airways) issuing a small RFP for 777 aircraft to replace its rather inefficient A340 aircraft (didn’t happen.)

 

India:  I thought Jet Airways and Kingfisher might merge with the name Jet Airways being retained.  In fact, both airlines continue to exist but both are suffering severe financial problems, deferring aircraft deliveries and generally flailing about trying to find a way to continue.   One of these airlines will still ultimately have to exit the market and I continue to think it will be Kingfisher.  They have the wrong aircraft and the wrong aircraft on order.  However, Jet Airways is suffering badly from labor actions among its employees. 

 

United States:  I picked United to fail.  It hasn’t happened and while they continue to live, their cash holdings are being reduced, they still have severe labor issues, their service product continues to suffer and I still think they should be the ones to disappear.  I also thought Glenn Tilton would be ousted and, possibly, replaced by Doug Steenland.  That didn’t happen but John Tague has been groomed as Tilton’s replacement.  I still think Tilton should go if United can’t fail.

 

Europe:  I thought we would hear of a surprise from Lufthansa.  I didn’t like their purchase of SWISS and I didn’t like their flying the A340 in competition against the 777 being flown by many of their direct competitors.  They’re still here, still making money and they bought BMI.  I still think we’ll here of misfortune from them but apparently it will take a while longer. 

 

Random Speculations:

• I thought Southwest might add another aircraft type.  It didn’t happen but I think their interest got perked up when they looked at buying Frontier and saw the economics on the Q400.
• I thought Delta might order more Airbus A330 aircraft.  Instead, Delta is parking them in the desert for the winter season.
• I speculated that both China and Japan would defer or drop their regional jet programs.  That didn’t happen but the Chinese jet program appears to be a bad aircraft and unlikely to be used by anyone except Chinese airlines forced to buy it.
• I thought Bombardier would see a major order (20+) for their Q400 series aircraft from a US customer.  Horizon Airlines did up their orders  for 10 more but there were no other significant orders. 
• Airtran to form a small midwestern hub.  Yup, that happened.  In Milwaukee where they’ve taken over from Midwest Airlines and now face Midwest (brand owned by Republic) and Southwest Airlines entry into the market.  I think Airtran will hold on here and continue to develop business.
• Last, I hoped that jetBlue or Virgin America would enter the DFW market.  Virgin’s CEO, David Cush (formerly of American Airlines) did recently speculate about adding flights to either DFW or Austin.   I suspect they’ll choose Austin and DFW will remain a fortress for AA.

 

That’ s it for my 2009 predictions.  I’ll make more at the start of 2010.  On the whole, I probably did as well as anyone in making predictions in this business.

Filed under: Airline Fleets, Airline Service, Death Watch by ajax
No Comments »

On November 18th, The Atlanta Journal-Constitution published THIS story of an account written by a man known as “Ted” or “Tedd” Petrunas claiming that there was a “terrorist dry run” on an Airtran flight (Flight 297) he purportedly took from Atlanta to Houston.  Journalist Terry Maxon of the Dallas Morning News wrote a post on the newspaper’s aviation blog which can be read HERE.

 

Frankly, the story immediately struck me as false and you’ll find my comments responding to the story on the Dallas Morning News blog entry linked above.  Anyone who has traveled regularly has seen odd things happen on a flight and I’m no exception.  However, the account was notably racist in my opinion and didn’t contain any of the “normal” reactions by airline crew and staff that one would see in such a situation.   The account of this man storming down aisles and taking charge is in direct conflict with any flight attendants normal reaction to a situation.  Flight attendants are not weak and frail creatures and even a FA who has only a year on the line has already become a immune to odd behaviors on the part of crew.   They don’t burst into tears when yelled at.  They certainly don’t allow passengers to take over for them.

 

But what really bothered me about the story was the racist descriptions of “muslims”.  First, how do you identify a muslim?  I’m sure that I cannot do so with any certainty.   And what is the attire of a muslim?  I ask because muslims quite literally come from around the world and a muslim from Indonesia or China is a very different person from one from Pakistan or Yemen.   In short, this story of a terrorist dry run stank. 

 

Terry Maxon followed up on the story on December 4th with a post that can be read HERE.   He noted a story done by TV station KHOU (found HERE) .  In this story a Chaplain Dr. Keith Robinson (no relation) is quoted extensively about witnessing some of this story and claims to have spoken to Mr. Petrunas.    It was notable that, by this time, Mr. Petrunas had refused to speak on camera to KHOU citing that financial considerations keeeping him from doing so.  Imagine my complete lack of surprise at that.   However, Chaplain Robinson’s account lacked a certain genuine feel to me as well.  If you watch the video, this is a person who does not seem to be relating a first hand account or even doing a good job of relating a second hand account given to him. 

 

I’ll also point out that Chaplain Robinson is in the uniform of a law officer in the video and a search on Google reveals that Chaplain Robinson has some kind of association with several right wing websites.  Just one example of that is HERE.  His own authored account on that website is quite self serving and lacks credibility when you read it in its entire context as well.  I would not be surprised to learn at some point of an existing relationship, even a slim one, between Mr. Petrunas and Chaplain Robinson.

 

Additionally, the KHOU story quotes Airtran saying that the account given by both Chaplain Robinson as well as Mr. Petrunas did not track with statements obtained from the flight crew.  Mr. Petrunas also said to KHOU:

 

Petruna stands by his statements, with the exception of his description of the men’s attire. He also said he never witnessed the men watching porn, as he said in the e-mail.

 

and we have this:

 

In a statement to 11 News, AirTran said, “A number of the allegations included in the article posted by Mr. Petruna conflict with the statements obtained by the flight crew.”

 

A ha.  Suddenly we’re backing away from the most obviously outrageous parts of the account. 

 

By this time, I had decided that this had been a run of the mill conflict on the aircraft which required the airplane to return to the gate.   Airtran wisely decided to make a statement after investigating further which can be found HERE toward the bottom of the Dallas Morning News blog post.  However, conspiracy theorists were quick to mis-interpret Airtran’s statement with respect to the crew change.  Namely, Airtran said: 

 

The crews were swapped. This is a common occurrence in the aviation industry for any number of reasons. If a Crew Member cannot or will not continue a flight, we must replace that Crew Member.

 

My first thoughts were that Airtran may have made an error with the phrasing of that last sentence since it could lead to open speculation and it did.  Conspiracy theorists immediately grabbed on to that part of the statement as an “a ha” moment.  Again, any person who has traveled regularly on airlines and certainly any aviation enthusiast or airline employee knows that crew changes such as this can happen for many more plausible reasons such as the delay causing the crew to “time out” on its available duty time.  This happens almost daily and I suspect that is what happened this time as that flight was likely a “turn” from ATL to HOU (Houston) and back with no reserve crew available in Houston to take over.

 

But wait, there is more.  This morning the Atlanta Journal Constitution published this STORYand the Dallas Morning News (Terry Maxon) posted this entry on the Dallas Morning News Aviation Blog HERE.  In short, it seems that Airtran has discovered that Mr. Petrunas wasn’t even on the flight.    The Atlanta Journal-Constitution said:

 

In its continued investigation into the incident, the AJC made several attempts to speak to Petruna about the incident. He has declined throughout the week to respond to repeated e-mail and phone attempts by the AJC to talk to him.

Additionally, interviews between the AJC and people on the plane,  airline officials  and federal agencies did not corroborate his story of what occurred on the flight.

 

and also had this:

 

Nancy Deveikis was seated in seat 29A aboard Flight 297, directly behind an unidentified man who she believes spoke Spanish. Deveikis said the man was looking at pictures on a camera, and did not understand a flight attendant’s requests to turn the device off.

 

and also this:

 

Keith Robinson didn’t make it to the gate in time to board Flight 297 for its initial attempt to depart.

 

How many people miss their flight and notice something on a monitor that indicates a flight is coming *back* to the gate?  The short answer is no one does.  I’m even pretty sure that no status on an airport monitor would show that flight coming back to the gate.   Indeed, it takes airlines quite a long time to update status on those monitors when everything is going well. 

 

It would appear that anyone who decided to jump on this train and speak to the media early on decided to have their 15 minutes of fame instead of contributing to the truth.  Shame on both Mr. Petrunas and Chaplain Robinson for lying and contributing to racists fears when it comes to air travel.   Shame on them for their characterizations of the air crew and staff as well.

 

I offer a big thank you to the Atlanta Journal-Constitution for doing what a newspaper should do (investigate and get the truth) instead of buying into the sensationalism of fear.  In addition, kudos to Terry Maxon for following this and keeping it balanced rather than buying into the sensationalism of fear.   Shame on KHOU for racing in to fan the flames.    Finally, thanks to Airtran for being brave enough to investigate, make a statement and do their best to moderate this situation as well. 

 

I wish I could say I was shocked to read these revelatioins as the story unfolded but I am not.  This kind of fear mongering poorly serves the country and I do hope both of these men hang their head in shame but I somehow doubt that that will happen.    Nonetheless, it remains quite safe to fly in this country and I hope anyone who is flying soon has a great trip.

Filed under: Airline News by ajax
2 Comments »

What if you have to re-schedule your travel while in the middle of it?  Any regular flier dreads any changes to their flight schedules before leaving on their trip but needing to make a change in the middle of a trip is positively terrifying.

 

But should it be?  Perhaps not.  Legacy airlines are charging exorbitant fees to change flights with some reaching $150 just for the privilege of ringing the airline and asking to return a day later or two days earlier.   On American Airlines (and most legacy airlines are similar), if you change your ticket, you’ll be liable for the new one way fare plus a change fee ($150 in most cases for domestic travel) which, if you bought a non-refundable advance fare, could be exorbitant.    But you do you have options if you are willing to work a bit.

 

Recently, a friend traveled to the Northeastern US for Thanksgiving.  While visiting family, one of his parents was injured and he decided he should stay over a while longer to help out.  Changing his ticket cost him a small fortune and, unfortunately, he didn’t think to look outside the box.   If he had abandoned that ticket and simply shopped for a new ticket on Airtran, jetBlue or even Southwest Airlines, he would have saved hundreds of dollars.  Ironically, there were sudden last minute fare sales for immediate travel instituted on the very day he chose re-ticket.  

 

Flexibility, as always, is the key.  Yes, you may have to accept 1 or more connections or even explore ticketing on two different airlines but the savings is often far greater than what your time is worth.  If you feel intimdated by having to do battle with the airlines or pressured by the need to resolve the issue quickly, I highly recommend trying the Cranky Concierge service that I’ve blogged about HERE.    Airline geeks are creative thinkers and the fee you’ll pay Cranky for thinking for you will be paid for in huge savings in most cases.    What could take you 3 or 4 hours to explore (even if you’re relatively sophisticated at searching for airline fares) can be solved by someone like him in a matter of an hour or less in many cases.

Filed under: Travel Hints by ajax
No Comments »

A couple of weeks ago I wrote about Airtran’s decision to enter the Milwaukee – Dallas / Ft. Worth market using Skywest Airlines.  That post is HERE.

 

I noted that American Airlines has virtually owned this market with Midwest also having a nice chunk and AA hasn’t really had much in the way of competition for that route.  Well, the American Airlines of old has responded.  According to the Airline Biz Blog, AA is adding flights to that route using American Eagle and those flights match up closely to Airtran’s announced times.  No one should be too surprised that AA has responded this way since it’s been their strategy to flood new competition with capacity and frequency and to capitalize on their hub connections. 

 

Will it work?  Many would give AA the advantage in this battle because they do have a tremendous number of connections through Dallas.  The problem is, my sense is that the main part of this route is traffic that originates and ends at those two cities.   I’m not sure there is a whole lot of connecting traffic.  Certainly there is some. 

 

However, American Airlines has kind of abused Milwaukee for several years charging very high fares for that route and Midwest has never challenged them much instead choosing to enjoy an uneasy level of detente.  Now we see Midwest, Airtran, American Airlines and, indirectly, Southwest Airlines in this market.  Interesting. 

 

The next move is up to Airtran.  If they keep Skywest aircraft (50 seat CRJ-200)on this route and don’t upgrade it to their own aircraft, I suspect American Airlines will win this fight.  If Airtran chooses to move their B717 or even their B737 (I suspect the former is a better fit) on to the route, I think American Airlines might just see their traffic erode badly.  Milwaukee to Dallas consumers are accustomed to the B717 and, I think, would enjoy the relative comfort and opportunity to upgrade to Business Class (cheap and easy to do on Airtran). 

 

Midwest is the unknown.  Frankly, they are using their Embraer E-170 aircraft (76 seats, all coach) on this route now and while it is certainly better than American Eagle’s ERJ-145s (50 seats, cramped coach), they still aren’t what those customers are accustomed to enjoying on that route.   Until less than a year ago, Midwest flew very comfortable 717 aircraft that included both a comfortable business class as well as a comfortable coach seat.  Airtran can offer that now.

 

Would AA add MD-80 or B737 aircraft to the route?  No, they don’t have aircraft available and the best they could do is, perhaps, a CRJ-700 via American Eagle.  However, those aircraft are already very busy on other routes. 

 

American called Airtrans’ bluff and even raised the stakes, so to speak.  American Airlines is not in the habit of giving up either so we can expect that they’ll keep these frequencies (and the lower prices) as long as they think they can to preserve the market share.    Right now, they are offering a matching $89 fare (each way) for advance purchase.  However, their remaining economy fares are $678 and $863 each way (there is a First Class fare for over $1700 each way but which requires a connection to someplace like Chicago so you can fly on a mainline aircraft).   I think we see where Airtran can offer real value here. 

 

So, we know two things.  First, it is up to Airtran to make another move or accept the status quo.  Second, there is way too much competition going on for Milwaukee traffic.  Some airline will have to quit.

Filed under: Airline News, Airline Service by ajax
No Comments »

Almost everyone who follows the airline business and the airlines themselves continue to insist that people buy overwhelmingly on price and there is quite a bit of evidence to support that general feeling.    The best example is that among legacy carriers serving a particular non-stop route, when one airlines lowers their price, the other airlines can and do see a drop in their bookings for that route if they don’t match that price.

 

There is a lot of truth that individual routes can be seen as nearly perfect competitive environments.  Any airline executive worth his salt will tell you that when an airline opens up a city pair, they look upon it as growing another business.  Each route is a “business” to be developed and nurtured and maintained.

 

Legacy airlines are the masters of being all things to all people.  Low cost carriers are the masters of high frequency/low cost models.  Leisure airlines have learned how to serve market with low frequency but high value.  

 

But what do most people want?  That isn’t ever as clear as people want to believe.  The dynamics between two cities change over time and adjusting to those changes is essential to maintaining that “business”. 

 

My father, once a very senior airline executive, told a story to me long ago that I’ve never forgotten.  His airline, Braniff, served the Dallas / NYC route with a daily late afternoon flight that for years was a huge money maker because it was flown primarily by businessmen.  In the mid-1970’s, they noticed that traffic on that route began to erode ever so slightly and even a small erosion worried an airline even back then.   Then he happened to take the flight to do some financial business in NYC on behalf of the airline and he realized the problem.

 

Business between the two cities had begun to change.  Traditional businessmen such as bankers or leaders of large corporations had continued to fly that flight because their model was to go to NYC the night before, conduct some business until 2 or 3 in the afternoon and then fly home to be in their own homes by mid-evening.   But entrepreneurship had begun to flower and more and more businessmen/entrepreneurs saw that as a waste of time for such a trip.  They wanted to work until late afternoon and fly home as late as possible in order to maximize their time there.

 

So Braniff added a second flight in the early evening that allowed businessmen to work until 4:30pm, go to the airport and catch the 7:30pm flight home which put them back in Dallas late at night but which met their needs to stay as long as possible to maximize their work.   As a consequence, both flights began to do much better because even the entrepreneurs could recognize that when their work was done, it was time to go home and if it was done at 2pm, they went to the airport and caught the early flight home.  Traditional businessmen began to be expected to be more efficient and when they couldn’t leave at 2pm, they knew they had another option for later in the day.  Braniff began to own that route again.  Frequency was the answer.

 

I would argue that when two or more airlines “own” a route, service is often going to be the discriminator.  But what form of service will be necessary?  Is it options in seating that allow a traveler to have more legroom?  Is it more frequency?  Is it some form of a meal?  Is it WiFi or video on demand?

 

For 30 years airlines have worked to harmonize their fleets, reduce the different number of equipment types and flatten their service offerings to the lowest common denominator.  Particularly the legacy airlines.  But for the past 10 years, we’ve seen new airlines offering more segmented choices on each flight and those airlines are the ones who continue to earn a profit, experience growth and satisfy shareholders.

 

There have been some half hearted experiments with increased choice and segmentation.  Delta had Song airlines offering more entertainment and a brighter, cheerier environment.  United had Ted airlines which was economy oriented.   But I suspect that it wasn’t necessary to change the brand so much as it indicated a need to offer more choice on the aircraft.

 

I think in the future we’re going to see more choices in seating on airlines.   The low cost only passenger wants price above anything else.  The business traveler needs an economy choice (to satisfy their company’s desire to economize) that offers a little more room.  I think we’ll see different seat pitches offered and different service choices (a la Frontier) offered as well.  This is an area where Frontier has pioneered change and seen positive results.  Same for jetBlue.  Those airlines continue to earn an operating profit and grow.

 

Legacy airlines are going to have to be more flexible in fleet, fleet configuration and they’ll even have to consider offering things like meals and entertainment.  There already is a move to do this among certain airlines.  Continental is adding LiveTV to their fleet.  Delta/Northwest has recognized that having a varied fleet allows them to “tune” their service to the demands and continue to earn a profit. 

 

When an airline can adjust capacity on a route by season, month or time of day, it can continue to make money.  When it has just two choices of aircraft to use on a route and both have more capacity than needed, they start to lose money.  (Hello AA.)

 

I think that one day one legacy airline will have the guts to start advertising in markets that speaks to “real world” experience on their line versus the airline that “owns” the city.   For instance, I think Continental could come into the Dallas market and already argue that yes, you have to connect in Houston to go to NYC but if you do, more often than not you’ll get there in the same time with better service than flying American Airlines who has an untrustworthy on-time record and who treats their passengers to old aircraft and little or no service.   Someone will have the guts to start trying to change the perceived value of travel.

 

The truth is that there is a great difference between legacy airlines on any two city pairs.  The key is to identify that difference and communicate it to the traveler.  Right now, that really doesn’t happen.   An airline such as Continental shouldn’t attempt to compete with AA on price alone.  They should offer the real differences such as a meal on flights of 3 hours or more, LiveTV, equipment that is as much as 10 years newer or more than AA and a staff that enjoys doing its job.    They should offer incentives for changing airlines and trying them once such as a guaranteed business class seat for the price of AA’s economy seat. 

 

It will happen in some form.  It has to.  The newer airlines such as Frontier, Airtran, jetBlue and Virgin America have all proved that offering more choice on the aircraft works.  Even Southwest has recognized that it has to offer more choice in order to retain their very valuable business traveler.   What’s more important is that even some passengers who buy on price alone have realized that the incremental extra cost of one or two of those “extras” is worth it once again.

Filed under: Airline Fleets, Airline Service by ajax
No Comments »

I went on hiatus last may because of increased work demands.  Now, my business is entering a slower period and I’m back.  I had been planning on re-starting this weekend but when I got a free Airtran GoGo Inflight WiFi pass, I decided to re-start at 33,000 feet.

What can I say?  I’m impressed with the service.  Speed seems excellent and I’m tracking my own flight via FlightAware.com right now just for kicks.  I can report that it appears to be about 3 to 5 minutes behind “real time”. 

Airtran has, once again, reminded me of what real value is when flying today.  It’s pleasant cabin staff, on time departures, decent seats and while I *hate* the baggage fees, I’ll at least give a shout out to Airtran for being one of the more affordable airlines as well as making it possible to pre-pay the fee online when doing one’s check-in. 

I’m landing soon so I’m out for now but the blog is live again.

Filed under: Airline Service by ajax
1 Comment »

I got a new Olympus SP550-UZ camera at Christmas time. With 18x optical zoom, it was a huge improvement over my previous camera, an Olympus C2100-UZ. But after testing it out at DFW at the end of December, I realized I needed just a hair more “oomph” and bought an Olympus TCON-17 1.7x teleconverter. That did it.

Plane spotting at DFW is always a bit boring for long stretches because you get to watch American Airlines’ MD-80 and B737 aircraft land all day long with very few other airlines to break things up. On this visit, I managed to catch the AA PinkRibbon Susan G. Komen Embraer RJ once more. I captured a Sun Country Airlines 737, an Airtran 717 and a Lufthansa A340 all taking off or landing on the far runway from Founder’s Plaza. Previously, they would have been a tiny spec in my camera.

I also saw a hawk standing in the field at the foot of the runway watching both us, the spotters, and the aircraft landing. It seemed like it wondered what the big deal was. One of the DFW fire trucks came by on the service road and goosed his fire pump as he went by much to my surprise. I just happened to be taking a photo of him anyway and got the water spraying out although only close up instead of from far away.

The other catch was a China Airlines Cargo B747-400. We visit a secluded area to shoot from that requires us to drive past the air cargo area on the west side of the airport. As we drove by, we saw this huge aircraft parked and pulled over to take photos. While doing so, I noticed it was buttoned up completely and running its APU and figured it would be taking off soon. It did but took nearly an hour to do so.

We also saw three corporate jets take off one after the other. You can see them HERE, HERE and HERE. Both my wife and I had the odd feeling of almost a race the way they took off and quickly turned south by southeast. About 20 minutes later, my wife guessed it. They were the wealthy taking off for Tampa and the Superbowl. I’m sure she is right. They took off so fast that I was only able to get one good photo of each.

 

Take a look at this PHOTO.  The aircraft seems to either be coming straight at me or aimed just to the left of me.  In fact, the runway was to the right of me.  The crosswinds for that runway (13R-31L) must have been pretty high today.

One final observation. I’ll be sorry to see the Northwest Airlines livery fade away into Delta. Northwest has, in my opinion, one of the handsomest liveries on a US Airliner and it is a shame that Delta isn’t even retaining some small portion of the logo.

You can view all of the photos HERE.

Filed under: Airplane Spotting by ajax
4 Comments »

Last week an extended family of Muslim Indians were removed from an Airtran flight from Washington D.C. to Orlando.  It made the news in several places but here is an LA Times / Associated Press version of the events.  Scroll down to read the story.

 

I take issue with several details of this story actually.  First, this happened to US born US Citizens of this country.  That in itself is highly objectionable to me because it is clear that this issue formed as a function of their appearance and the assumed religious identification of these folks.  That is xenophobia. 

 

Second, the conversation they had which prompted the reaction by passengers was a conversation that I have personally heard  spoken on many flights and that includes a conversation between myself and my wife the last time we flew together to New York state.  It’s a conversation that many people have because the infrequent traveler wants to feel safe on an airplane.  Now, when my wife asked me about the “safest” part of an airplane to sit in, my own response was that I couldn’t imagine a “safe” place to sit on an airplane traveling hundreds of miles an hour about to hit the ground.  I also said that it’s foolish, in my opinion, to believe such a place exists on airplane that is going to crash.  No one objected to that conversation or many of the others I’ve overheard on airplanes since 2001.

 

Third, even if I concede it might have been something worth checking out, at the least, the FBI cleared this family to travel after speaking with them and the TSA cleared *all* of the luggage traveling on the airplane.   The FBI actually encouraged Airtran to carry on and, still, they were kept back.  Why?  Because airlines have decided to leave such a decision in the hands of the captain of an airplane and, at the same time, encourage pilots to *always* take the path that is most “sure” in such situations.  In other words, captains are simply encouraged to deny boarding to the suspect passengers on that immediate flight because it keeps everyone settled.

 

I take objection to that.  I would like to see a captain and his crew show some moral courage and simply indicate that such passengers, after being fully checked out, were OK to fly and they therefore were going to continue on the flight as every other paying passenger would expect to do so if it were them.   There was absolutely nothing to be afraid of whatsoever. 

 

Terrorists come in all shapes, sizes, religious denominations and physical appearances.  For us to accept that it is morally correct to seize upon someone as a potential terrorist simply because they are of the same race or religion as those terrorists of September 11, 2001 is stupid and ignorant of the way the world works. 

 

Want more proof?  The two people who initiated this concern with the flight crew were teenage girls.  I have a teenage girl of my own and I assure you that teenagers are *not* capable of making a credible judgement about someone who might be strange to them.  They are still kids, not adults and they certainly do not possess the life experience necessary to make such judgements.  That is why they are under the custody of adults, their parents. 

 

Airtran has most likely lost this Muslim Indian family as a set of customers for life.  By my count, that probably cost them about nine airfares to a destination that many families repeatedly visit.   All in favor of two teenage girls.   That was a foolish business decision. 

 

I have said it before and I will say it here.  The likelihood that a group of terrorists could take over an airplane, pilot it to a city such as New York City and crash one or more aircraft into a building after the tragedy of September 11, 2001 is so small that you have a far bigger risk of getting killed by lightening.   Do you wander out everyday wondering if this is your day to be killed by lightening?  The reason that attack was successful was because airlines have for years trained their staff to cooperate with a hijacker to get the plane to the ground where almost always the situation is resolved without deaths.  It was, until September 11, 2001, a very rational and very reasonable strategy.

 

Now it isn’t.  No plane will ever let someone or a group hijack an airplane in that manner ever again.  Not the passengers and not the flight crew.  Think I’m wrong?  Take a long look at how every other incident of someone losing control on an airplane or of someone attempting to breach a cockpit door has ended since flying began again in the post September 11 world.  Every person has been met with overwhelming force from passengers and flight crew and ultimately restrained. 

 

No, the next big attack won’t be by airplane.  It will be by another strategy that someone will use to take advantage of a security weakness either in another transportation mode (did you know that trains didn’t screen passengers and luggage like the airlines until the last year) or through a delivery method that is simply unpredictable at this time.  And it won’t necessarily be by Muslim terrorist either.  If you think I’m wrong, let me point you to the Oklahoma City bombing by a white Irish Catholic man named Timothy McVeigh.

Filed under: Airline News by ajax
No Comments »

And now we come full circle back to the United States and Europe.  Both have highly developed, highly competitive airline markets.  Each has both LCC type carriers and legacy carriers (and Europe’s legacy carriers are the former national flag carriers in many respects.) 

 

This won’t be a rebuilding year.  To the contrary, both markets really need one large airline to be removed from the market.  In the case of the United States, I firmly think that should be United Airlines but in Europe that is a harder guess.  If I had to pick an large airline in Europe for the surprise of the year, it would be Lufthansa.  They are, by all accounts, a great airline but I smell trouble in that group.  First, they have been buying into airlines that have been unable to survive on their own.  That lack of survival, in many cases, isn’t because of poor management but just a lack of market share being available to them. 

 

Lufthansa has bought SWISS, for instance.  I’m not sure why and I’m not sure if they can tell us why.  They could have just as easily taken SWISS’ business  and left them in a heap.  Further, Lufthansa has a lot of Airbus A340 aircraft.  Those airplanes just don’t compete on high capacity, long haul routes anymore.  What’s more, they also have orders in for the Boeing 747-8, another large capacity, four engine aircraft.  Their competitors, Air France/KLM and British Airways, have seen the light in buying more and more Boeing 777 aircraft for their long haul, high capacity routes.  It costs less to operate them and they make more money as a consequence.  So, going out on a limb here, I say we’ll discover that Lufthansa is nearly insolvent some time by the end of 2009. 

 

Both markets in Europe and the US will continue to face challenges in costs (fuel and more particularly labor) and LCC competition will continue to press air fares downwards.  The real solution for large legacy carriers won’t be found this year.  Expect more losses (with some exceptions such as SWA and jetBlue) and more merger talk in general.

 

Here are a few more random predictions:

 

• United Airlines will ask Glenn Tilton to resign and hire an experienced airline executive.  One possibility will be Doug Steenland, most recently Northwest Airlines CEO and now Vice-Chairman of Delta.
• Southwest Airlines will, for the first time, examine adding another aircraft type to their fleet.  My guess is it will be the Embraer 170/190 series.
• Airbus will land a major order for aircraft from a traditional Boeing customer in the United States.  My bet is that Delta orders more Airbus A330 aircraft.
• China and Japan will drop their regional jet programs or, at the least, defer them for up to 5 years.
• Bombardier will announce a major order (more than 20 aircraft) for the Q400 Turbo-Prop from a US Airline.
• If fuel prices remain steady, Airtran will seek to form a small mid-western hub.
• Last but not least, one LCC type carrier such as jetBlue or Virgin America will attempt to fly to DFW Airport (wishful thinking on my part.)

 

 

Happy New Year Everyone.

 

 

Filed under: Airline Fleets, Airline Service, Death Watch by ajax
No Comments »

The current economic climate doesn’t speak well for airlines who depend upon business travelers to meet their expenses on a flight.  For the past several years, airlines have been introducing airline seating that specifically caters to the business traveler and, quite frankly, a product that meets or exceeds anything that represented First Class even in the 1990’s. 

 

The airlines are always faced with a difficult set of priorities to balance.  On the one hand, catering to the business traveler is essential because they do pay for a good portion of each flight and they must compete for those travelers very aggressively.  On the other hand, filling those last 100+ economy seats is also essential because that is the difference between profit and loss.   Typically, an airline will woo the business traveler with comfort and the economy flyer with price.  In order to compete on price, that means reducing your costs per seat to the lowest possible and offering a ticket price that bests anyone else on a route.

 

Or does it?  In the late 1990’s, American Airlines began a program of more space in coach.  MD-80 aircraft were reconfigured to offer as much as 34″ of seat pitch and as someone who was flying a great deal at that time, I can confirm that it made a huge amount of difference.   Unfortunately, the post September 11th terrorist disaster forced American to reconsider its configuration and the aircraft were reconfigured back to a 31/32″ pitch.   But how many seats did that gain them?  Only about 9 seats.

 

The one thing airlines never seem to try to differentiate themselves on is seating.  While some airlines have tried an economy plus seating (offering about 34″ to 36″ of seat pitch), no one really advertises the advantage of more seat room.  It is never heavily marketed like many other airline qualities.   That is a lost opportunity.   I do not believe people would necessarily choose a flight on an airline on the basis of only price if they were fully aware of a more comfortable option at a minor extra cost.   Airlines such as United Airlines often only take the opportunity to tell a customer of these seats after they’ve already made a purchase and only as an upgrade. 

 

Offering an increased seat pitch and explaining its comfort and, possibly, better position in the aircraft would, I think, be an attractive offer. 

 

The question is how much extra do you have to price that seat per leg?   I suspect about $20 per flight segment would work.   Possibly as much as $30.  But why not offer it by the hour?  Would you pay $10 / hour for a better seat?  Chances are you would.  However, that upgrade must be presented BEFORE the purchase to be attractive on price and that upgrade must be described in what it offers the customer.  More leg room, a better position in the cabin which makes for easier entry and exit from the aircraft. 

 

More room does not necessarily have to mean fewer seats either.  I’ve written before about Delta’s adoption of the Thompson Cozy Suite seats on their 767 aircraft.  There are other options as well.  Airtran offers a Recaro aircraft seat on the Boeing 737 aircraft that is unparalleled currently as an economy seat.  Its design offers just a tiny bit more leg room and yet configures easily to the same 31/32″ seat pitch airlines want to use.  It provides a more conventionally thick seat cushion on the bottom and upper half while offering a better contoured lumbar area that while thinner, is much more comfortable and yet offers the passenger behind you that little bit of extra room.

 

Sicma Aero is concentrating its efforts on a more ergonomic seat but I question that direction because how do you create an ergonomic seat that feels comfortable to both the 5′ tall 100lbs woman and the 6′ 2″ tall, 270lbs man?  It requires adjustability and that quite likely is going to cause trouble both with maintenance and the customer who doesn’t understand how to adjust the seat.

 

Avio Interiors has taken an approach more like Recaro by offering a seat that is properly cushioned in the right points but sculpted to again offer that small but important extra space for legs. 

 

 Thompson Solutions offers both the Cozy Suite as well as a more conventional but ergonomic economy seat.  The key to their offering is a staggered or herringbone style layout that allows airlines a 15″ gain in capacity or greater width and seat pitch.  Since aircraft are generally limited by either their load or the maximum seating they are certificated for, Thompson’s solutions (no pun intended) allow an airline to offer a new seat that is competitively priced, less maintenance intensive and vastly more comfortable than a conventional seat.  The key obstacle here is that airlines are afraid of making the investment and facing customer rejection of a design that is admittedly fairly radical in appearance.  With Delta introducing this on their 767 aircraft, I suspect the airline’s fears will be reduced and there will be a push to find similar solutions for new fleets.

 

Weber Aircraft, based in the United States, is offering a much more conventional product that, unfortunately, seems pointed towards high density seating without any emphasis of comfort.  Make of that what you will.

 

While airlines will no doubt seek to maximize their loads on aircraft and match pricing from their competitors, it becomes increasingly obvious that market capture can be based on these new seating options provided that the airlines themselves will actually market their product.  People still want comfort and the success of a la carte pricing indicates that people will still pay for what they want. 

 

The challenge is in airlines changing their marketing model both on their own websites as well as through popular travel sites.  When a customer can make their choices from an a la carte menu and choices include better, more comfortable seating that is well described, airlines will both differentiate and sell their product better.  Airlines even have the chance to sell such a product as a business offering to companies that do understand the value of taking care of their employees but who have to now measure that against the often 4 times greater cost of a business class seat.

Filed under: Airline Seating by ajax
1 Comment »

Airtran Airlines has announced that it will begin charging for the 1st bag checked on their flights starting December 5th (2008) and those purchasing tickets on or before November 11th will not have to pay those fees.  In light of the fact that Delta recently announced its intent to implement such a fee, this really comes as no surprise. 

 

Clearly a la carte fees are the new model for air travel and while many can no longer be argued against, this 1st bag checked fee continues to rankle many travelers.  It is akin to charging a cafeteria customer for his tray.  However, since most airlines have adopted this fee, it will be difficult to escape it as a traveler.   I even wonder if Southwest will backtrack on its “no fees” campaign in light of the industry direction.   It will become increasingly difficult for Southwest to remain competitive in many markets by forgoing this revenue opportunity that virtually ever other competitor has adopted. 

 

Filed under: Airline News by ajax
No Comments »

Every now and then you see an airline flying a flight to some very unusual destination.  Two Airtran aircraft were spotted flying to Keflavik, Iceland en route to Europe.  You can see HERE that the aircraft looks as if it departed the Miami area normally and just got lost. 

 

One reader of FLying Colors is a huge Airtran B737 fan.  Don’t worry.  They sell their aircraft relatively young and buy more.  The fleet will remain the same.

Filed under: Trivia by ajax
1 Comment »

USA Today’s Today in the Sky blog has a story about Airtran now offering upgrades to business class (space available of course) after a passenger has boarded the aircraft.  This is smart for a few reasons.  One, it’s one more opportunity to get that revenue.  Two, passengers may well be much more motivated to buy that uprade if they see the seat.  Three, passengers may well be much, much more motivated to buy that upgrade upon discovering that economy is full.

Filed under: Airline News, Airline Seating, Airline Service by ajax
1 Comment »

A fair fare would probably be identified by most people as an air fare that accounts for the true costs of flying from point A to point B non-stop using the right aircraft to supply the capacity.  As a matter of fact, that was what the Civil Aeronautics Board tried to adjudicate when setting fares. 

 

Now, such a model might sound familiar.  It sounds like what LCC carriers such as Southwest Airlines and Airtran do.  In many sense, yes it is.   Legacy carriers, focused on hubs, hurt themselves with those hubs every time they carry a connecting passenger.   The hub and spoke system demands that they carry more passengers a farther distance using more resources and economies of scale no longer allow them to make a profit doing so. 

 

Let’s use as an example travel from Midland / Odessa to Albuquerque.   You have 3 basic choices for travel in this scenario.  You can fly Southwest Airlines non-stop for about $260 round trip or you can choose another carrier for a non-direct, connecting route that starts at about $550 round trip.   Another carrier might be American Airlines, Continental Airlines or Delta Airlines. 

 

If you choose American Airlines, you’ll fly EAST to DFW and then WEST again to ABQ and it will take  . . . wait for it . . . from 4.5 to 6.5 hours to complete your travel.  Since you are connecting via DFW, you’ll be making two take-offs and two landings and one of those landings (remember, part of an airline’s cost is a landing fee) will be at a major hub airport.  Take offs are expensive too.  They are the part of the flight that consumes the most fuel so two take-offs is bad.

 

If you fly Continental Airlines, you’ll connect through IAH (Houston) and the economics are the same but the distance flown is even greater.   If you fly Delta, you’ll first fly to Houston and then to Dallas and then to ABQ and your price will be in excess of $1000 round trip.  By the way, your total travel time using Delta will be over 10 hours.

 

Now, if American Airlines or Continental Airlines (let’s just leave Delta out of this because such a scenario is absurd) want to compete for the passengers traveling from Odessa to Albuquerque, they have to offer a fare that is somewhat competitive.  If they do, they’ll come at least close to matching Southwest’s fare of about $300 and that means that their costs are higher and they make less profit or no profit.   Since Southwest has the lowest costs, they get to set the price. 

 

Now, some people such as Robert Crandall advocate re-regulation of fares in some form.  In a speech to the Wings Club in June 2008, Mr. Crandall offered that this might take the form of mandating a “minimum fare” that is the sum of “locals”.   What he suggests is that a fare between two cities that connects via a hub should be the sum of the fare(s) between Point A to Point B (a hub) and Point B (a hub still) to Point C (the final destination.  In the alternative, he suggests that flights that connect via a hub be required to have a “connection” charge.  His goal is to remove any incentives airlines might have at present for operating a hub.  It becomes officially un-economic to fly that route via a hub.

 

Quite honestly, I find that a poor solution since he proposes to disrupt the systems of the very airlines that his solution purports to help in the long term.  It disrupts a 30 year institution among legacy carriers and assumes the staff and leadership who have operated in such a manner to be able to adjust to a new model that they have no experience with.  It is, at best, a very awkward solution to the problem and only addresses revenues (once again) instead of the whole equation.  Even more important, it is hard to imagine the political will required for such a change.

 

No doubt the adjustments have to be made and I would suggest that might need to take the form of actually allowing a large legacy carrier to go out of business (which then removes some barriers to entry for other, more efficient carriers) or you have to find a way to reasonably deregulate costs so that airlines no longer must use hubs to fight for their very existence.  Those costs are principally labor.  The latter solution is better (both in the short and long terms) because it doesn’t necessarily involve massive unemployment or relocation for employees. 

 

An airline needs to be able to efficiently locate staff at various “base” cities in a way in which costs are not concentrated in one particular city because it is merely a popular place to live.  You don’t want all of your high cost employees (i.e. the senior staff) to locate themselves in Miami where much of your traffic might be low yield leisure travel.   Second, an airline needs to be able to competitively bid for staff on an open market.   A seniority system as used by airline unions ties staff to one airline and forces the airline to “wait out” their term of employment (as much as 40 years) until they can hire new, lower cost staff to fill a particular position.  Further, it denies them access to qualified personnel for expansion because staff won’t leave another airline for a new job because they don’t want to start out at the bottom of the seniority list.

 

If we deregulated (by legislation) the seniority system in airlines as a first start, airlines could suddenly re-allocate labor and gain more productivity and reduce their costs on routes where necessary.   For a first round, you could even leave in a seniority system for earning pay and determining furloughs but just remove the seniority system as it pertains to bidding for line routes and it would allow the airline to locate their labor (by cost) where they most needed it and gain more productivity.  That change alone might well serve to offer legacy carriers a legitimate opportunity to earn a profit regularly (with all other things being operated effectively).  It would at least be a good first step in trying to solve the problem.

Filed under: Deregulation, Trivia by ajax
2 Comments »

The Dallas Morning News Aviation Blog is reporting that Southwest Airlines just announced that they will begin flights out of Minneapolis / St. Paul next March.  The first flight will be to Chicago Midway which is no surprise. 

 

For some time, pundits have claimed that Southwest couldn’t enter this fortress hub and now they are.   To me, this is exciting news because I think that Milwaukee might not be very far behind as a station.  There is a lot of originating traffic between Milwaukee, Minneapolis / St. Paul, Chicago, St. Louis, Denver, Detroit and Kansas City.  If you look at the type of flying one would do between those city pairs, it looks exactly like a Southwest Airlines strategy.   What’s more, Southwest is already very strong in all of those cities except MSP and MKE.  The cost to start those routes and market them are relatively low since the airline only has to introduce itself in two of those cities. 

 

I feel certain that Southwest will grow MSP and then turn its attention to Milwaukee either in late 2009 or early 2010.   Sooner if they can so that they can compete against Airtran there.   This is good news for Minneapolis / St. Paul and probably bad news for Sun Country Airlines, an airline that has been faltering in the MSP market for a few years now.   I would be tempted to mark Sun Country Airlines as a possible purchase by Southwest because their facilities  and base in MSP has some value for Southwest.  Even their fleet, Boeing 737-800s, comes close to matching Southwest’s (B737-300/500/700) but I suspect they know that all they have to do is wait and much of it will be theirs anyway.

Filed under: Airline News, Airline Service by ajax
No Comments »

As an experiment today, I decided to go through the process of booking a flight and estimating the cost of the ticket and fees that might be associated with that trip.  To be fair and give a reasonable representation, I’m going to assume that I’ll enjoy a couple of beverages (but not liquor or beer since I don’t drink on flights as a general rule) and that I’ll be hungry.  To make it interesting, I chose to fly from DFW (where I live) to EWR (Newark Liberty International Airport and where my brother lives) and I’m going to choose 2 airlines for comparison.

 

To start, I visited American Airlines’ website because AA is, after all, the dominant carrier in my home town and most likely to offer a variety of flights that are non-stop.  A reasonable person seeks out non-stop first, right?

 

I found a flight leaving on a Friday morning and a flight returning on a Monday morning so that I could visit for the weekend.  After entering my preferred criteria, AA shows me a set of flights that, to my surprise, are labeled as being $164.00.  I’m feeling good suddenly.  I chose the outbound flight and it then asks me to select a return flight.  Hmm, there is that same fare so I choose an early morning return for the same price.  It felt like my roundtrip fare was $164 the way it was presented even though I actually know better from my own extensive experience.  The presentation gets one’s hopes up I suspect.

 

It wasn’t.  It was $164 each way for total of $328 and that, my friends, was as super saver fare.  The standard Economy saver fare (still not the full economy fare and therefore still subject to some restrictions) was $876 each way for a total of $1752. 

 

Now, my super saver economy fare was to also be taxed $21.00 for fees levied by various governments.  Now I’m up to $349.00.  Mind you, that’s what it has cost to simply book the flight and let me note that if I want a paper ticket (which would be unreasonable today but wasn’t just 8 years ago), I would pay an additional $25 and I would only have that option *if* I lived in a country where paper ticketing was required such as a Latin American nation.  Yes, they’ll let you pay $25 to receive a ticket if you live in a country where e-ticketing isn’t permitted. 

 

Now, since I’m flying to visit my brother, I plan to bring him a few things and since we tend to go out and enjoy ourselves, I’ll be taking my larger suitcase and need to check that bag.  The first checked bag fee is $15.  In some respects people have been seeing that as almost reasonable.  How reasonable does it look when you realize that you pay that fee EACH WAY?  Yup.  $30 for roundtrip baggage check of my bag.  If I were traveling with two bags to be checked (unreasonable), it would cost a total of $80 each way to transport two bags (and they still have to be under 50lbs each.)

 

So, just to plan, I’ll need to find out what my food and beverage costs will be for this trip.  I’ll be wanting a couple of soft drinks or cups of juice each way and it turns out that on AA, this will be complimentary for me.  GREAT! 

 

Both of my flights will be morning departures and it would be nice to eat a meal enroute so that I don’t empty my brother’s cupboard or force him to stop at a Nathan’s as soon as I get there.  It doesn’t have to be a big meal or a hot meal, just a good sandwich or something similar for a breakfast item.  Checking AA, I find that I have these options for my morning flights:

Snacks for $3.00

• 4oz of mixed nuts
• A 4oz MegaCookie (i’ll be choosing this.)

 

Snacks for $4.00

• Cheese and crackers (not for breakfast!)

 

Breakfast Sandwiches for $6.00 each.

• Breakfast Bagel Sandwich
  Enjoy a plain bagel topped with slices of roasted turkey breast and mild muenster cheese. This sandwich is served with a side of Hellman’s® mayonnaise and dijonnaise mustard.
• Club Croissant Sandwich
  Savor a freshly baked croissant topped with thinly sliced roasted turkey breast and aged cheddar cheese, garnished with crisp green leaf lettuce. Hellman’s® mayonnaise served on the side.

 

Neither of those sandwiches are very appealing but let’s assume I’m hungry enough to get one.  My meal costs each way will be $9.00 for a total of $18.00 roundtrip.  But, hey, I get a free Coca Cola right?

 

So, to take this trip on American Airlines, it will cost me $397 and that doesn’t seem too bad all in all.  However, let’s say my brother and I have just too good of a time and I want to return a day later.   That would cost me a whopping $150 change fee *and* the difference in fares.  Since it would be a morning flight, it’s safe to assume that I’ll be paying full economy fare and that would mean a one day change would cost me $1137. 

 

Now, let’s take a look at taking a different airline.  Since I have done this trip once before on Airtran, I’ve chosen them as my economy option.  It will require me to connect through Atlanta but my departure and arrival times are actually quite close to the non-stop AA flights so I’m happy enough with that.

 

First, I discover that my travel fare options include a super saver fare for $164 each way or a total of $370 roundtrip with taxes.  The taxes and fees for this choice were a stunning $43.00 higher.  Not a good start.  There is some good news though.  Airtran will let me check that first bag for free so I save $30 and find myself at this point with a total cost savings of $9.00 over AA right now.

 

But I will be hungry so let’s check out the options on Airtran.   Hmmm, no food except a complimentary snack of pretzels (which I only know from experience as it is not shown on their website.).  I’ll have to buy some food at an airport and I think that if we assume that I’ll purchase something resembling breakfast at McDonald’s, I’ll probably pay about $4.50 for a couple of sausage biscuits or breakfast burritos (and I’ll enjoy them more too just from my own experience.)  Let’s call my food charges an additional $10 just to be safe. 

 

My all in price on Airtran will be $380 vs AA’s price of $397 for a savings of $17.00 overall.  Now, which would I actually choose?  That’s tough to say.  Airtran offers XM satellite radio which I like a lot but I do own a MP3 player and I would very likely bring it along anyway so that doesn’t compel me towards Airtran.  I do prefer Airtran’s seating, particularly on their 737’s which use a Recaro seat that is a great deal more comfortable than AA’s economy seat.  That *might* compel me to choose Airtran. 

 

However, Airtran also offes a business class upgrade at the gate for pretty cheap prices per segment.  Assuming I could get it for 2 of the 4 segments, it would only cost me $69 each segment or a total of $138.  That is compelling.  In my experience, you need only arrive about 1.25 hours before your departure time and you can usually get these seats.  Flying Business Class gets me a nice seat and that is it though.  For a man like me at 6’1″ with long legs and weighing 275lbs, it’s nice to be a bit more comfortable and I would probably take that upgrade for two flight segments.  So, I would pay $518 total to fly travel an extra hour but be comfortable.  You might choose otherwise. 

 

My point here is that cheap economy fares are pretty much the same no matter what the airline.  At least on trunk routes.  It might be possible to save a dollar here and there but more often it isn’t.  Airtran’s approach strikes me as more honest in that while I do pay the same base fare, I don’t pay for the first bag checked (reasonable) and I do have some upgrade opportunities to a better seat.  I don’t get food but, then again, do I really want food from the airline?  In the real world I do not.  I’ll happily buy a burger or a breakfast at the airport because the food is not only cheaper but a bit more appetizing. 

 

Just for the record, I planned a similar trip from DFW to PDX (Portland, where my mother lives) for the same dates on both AA and Southwest Airlines.  Using the same criteria, here are the all in prices:

 

American Airlines:  $527 (including $21.00 in taxes and fees) for the ticket and a grand total of $575.00 (checked bag fees and meal prices included).

 

Southwest Airlines:  $469.00 (including $76.94 in taxes and fees) for the ticket and a grand total of . . . wait for it. . . $469.00.  Southwest has no baggage fees and they do not offer food.  Would I take SWA?  Nope.  Because it requires me to fly from DAL (Love Field) to ABQ (Albuquerque) and then to SLC (Salt Lake City) where I changes planes and fly on to Portland.  That’s a whipping and it’s just worth it to fly on AA’s decrepit MD-83 for only 3.5 hours to get there. 

In general, low cost carriers such as Southwest and Airtran are providing a slightly lower fare than the legacy carriers.  The difference in fares are mere dollars but that is because we examined economy super saver fares.  Want to know why those airlines soundly trounce legacy carriers?  Take a look at their business class fares.

 

DFW to EWR

AA:  $2902.00 all in.  Since it is business class, there will be no baggage fees and a decent meal will be provided. 

 

Airtran:  $1070.00 but since we’ll still have to buy a meal, let’s call it $1100.00 even. 

 

That is a savings of over $1800.  And it is the biggest reason why airlines such as American Airlines are doing everything possible to hold on to their valued frequent flier.  Sure, Airtran takes about 1.25 hours longer but if I’m running a business, my guys will be flying Airtran because with a savings of $1800, I don’t mind if they lose 2.5 hours of productivity. 

 

This is the real reason airlines such as American and United resent low cost carriers.   Low cost carriers set the price for the “fill” of the aircraft.  Which is the revenue they would not earn if they didn’t sell a seat at a discount price.  In addition, low cost carriers such as Airtran, Jet Blue and Frontier (and to a lesser extent, Southwest) are now competing for those business class passengers at prices legacy carriers can’t come close to. 

 

 

Filed under: Airline Service by ajax
1 Comment »

The Milwaukee Journal-Sentinel (newspaper of my birthplace), has this report on Midwest Airlines being late in paying over $1million in gate fees.  Midwest is on my death watch list and this news doesn’t improve their standing at all.  The story mentions that they are contemplating bankruptcy and I should mention that because of changes in the US bankruptcy law, bankruptcy isn’t an easy choice to make anymore.  Those changes in the law are, in part, what drove both Northwest Airlines and Delta Airlines to file bankruptcy in September 2005 on the same day.

 

Updates to the bankruptcy code now make it more difficult for an airline to file bankruptcy, continue flying and weather debt and fare wars.   Until October of 2005, most airlines used chapter 11 bankruptcy to essentially buy time when competitive pressures put them at a severe disadvantage.   However, Midwest has likely been weighing the chances of obtaining DIP financing (Debtor in Possession) and given their high labor costs, vastly reduced network and fleet, most would not view this as a healthy choice for investment.  In addition to high labor costs, the airline is headquartered and based in Milwaukee, a city known for strong union influence. 

 

Northwest’s 47% stake in Midwest also makes the airline an unattractive target for a merger to other airlines.  It is possible that Northwest will be ordered to divest itself of its holdings as a condition of approving its merger with Delta but it is not in their interest to do so one day earlier than mandated.  By holding onto Midwest, they make Milwaukee a kind of “fortress airport” that rebuffs other airlines attempts to enter the market such as Airtran.

 

If Midwest were to go into bankruptcy, it would be very difficult for them to make a case for proceeding alone.  They would have to look for a buyer and while Airtran could be interested, they have already begun to establish Milwaukee as a focus city and other than some assets (namely the B717 aircraft), I’m not sure what else they have to gain by buying Midwest now. 

 

 To survive, Midwest Airlines would have to enter into Chapter 11, break its labor agreements and obtain enough financing to purchase new (to them) long range aircraft that would support its original network all the while fighting off Northwest, Airtran and any other airline that smells blood.  That’s a tall order for any management team in this industry.

 

Filed under: Airline News, Death Watch by ajax
No Comments »