There has been a lot of talk about the Chinese aircraft, the COMAC C919, over the past year and what it means for Boeing and Airbus. From my perspective, it’s not the aircraft that is a threat. To the contrary, I do not believe this aircraft will be any more successful than any other Chinese made commercial airliner. However, I do think that there is a signal to be read in that the way the Chinese have chosen to engage in this project signals that they are learning and they do want to be a player.
To build a successful Boeing/Airbus competitor, you really do have to have quite a bit more experience than what the Chinese have. The real threats to Boeing and Airbus come from Bombardier and Embraer, in my opinion, because they not only know how to build an integrated system called an aircraft, they also know how to meet an airline’s needs as a function of having built their businesses from the ground up.
Bombardier and Embraer have doing what they do for a long time and they’ve learned through both successes and failures as well as from working with airlines to find out what they need in the next product they make. There is no substitute for experience when it comes to building that integrated system. That has never been more true than it is today.
China has a robust airline industry, to be sure, but it is one that has been dominated by the sublime customer service that Boeing offers every customer and even Airbus has struggled to bring itself to parity with Boeing in this market. Chinese airline executives understand and, more importantly, value what Boeing brings to the table when it comes to a complete customer product.
Chinese aviation industries would have been far better served with the goal of producing a world competitor in the regional jet class and taking their time to do it right. I’ll point out that Japan’s aviation industry has decades more experience building aircraft systems and even they are just getting their feet wet with a total system in the new Mitsbusihi regional jet.
A good jet engine isn’t the key to success in producing a Boeing/Airbus competitor. Competitive jet engines are easy to find. The harder part is the airframe, the avionics, the testing, the wing and many other things. It comes from knowing how to squeeze out even 1% more efficiency from an already mature system. You can’t buy that experience off the shelf. You have to earn it.
All that said, China has decided to get partners and good ones at that. They learn and they’ll listen and they’ll build their upon their experiences and as long as they keep trying, they will succeed more and more with future generations of aircraft. They key is to be in this for the long haul.
Traditionally, executing a strategy in support of the long view is a strong point for the Chinese but in this particular case, I sense a very un-Chinese like impatience to be a player. The real thing Boeing and Airbus should pay attention to is whether or not they regroup and re-engage when the C919 isn’t the killer app they think it is. If they do, it’s time to start getting worried. If they retreat and allow their experiences to wither, it’s over.
You can’t even build a modestly good aircraft and expect to succeed. You have to not only be able to make it look attractive from a performance point of view, you have to be able to service and support that product 100% of the time. Even Boeing and Airbus will tell you that it isn’t easy to do.
Take a look at the ARJ21 aircraft being built in China at present. It’s an aircraft that has already, for all intent and purpose, been exceeded by Bombardier and Embraer. It won’t fly for any airlines outside of China most likely and even then it’s unlikely to be even much of a political success. It’s an exercise to learn how to build an integrated system and China will have to work mightily to build upon that effort with the C919.
Even the Chinese airlines who made “orders” for the C919 at the recent Zuhai aviation show signaled some doubt. Most only made firm orders for 5 aircraft each with options for more. Frankly, that implies resignation to political realities, not enthusiasm. China is a country to watch in this business but this particular aircraft isn’t a threat whatsoever.
United Airlines (ContiUnited aka Continental and United Airlines merged) has a problem. Continental pilots have enjoyed one of the most restrictive scope clauses in the industry so far and United pilots have seen quite a bit of mainline flying move from their group to being outsourced to regional airlines flying the CRJ-700/900. Both parties are unhappy with outsourcing the flying and both see the merger and need for a new contract as the perfect opportunity to gain ground on this issue.
At the same time, United needs to keep its costs in line with rivals Delta and American Airlines and, if possible, lower. To do that under the present day model, that means outsourcing even more flying to regional airlines.
As usual, I would suggest that both parties need to meet in the middle a bit. Pilots (and other flight crew) could stand to permit lower wagese for this “regional” flying to keep it “in house”. United needs to recognize that this is about job security and these pilots want some assurance that their seniority means something in bad times. Neither party is going to get what they want or even a majority of what they want.
And if this conflict blooms into a multi-year negotiation, things won’t be good for either side. Pilots will lose out on salary increase opportunities and United will lose out on the synergies that this merger is supposed to provide.
One solution could be to retain the 50 seat Continental scope clause but pilots permit a lower entry level wage for 51+ seat aircraft or even perhaps a “B” wage scale until a pilot moves into generally accepted mainline aircraft (say 125+ seats.) The pilots could be permitted to use their seniority to retain a job in the lower pay scale in the event of a downturn and bad times displacing only the newest pilots and at the same time the airline could benefit from being able to use regional airlines for truly regional flying.
CEO Jeff Smisek would be wise to get creative rather than tough here. This is a real obstacle to realizing the benefits of his merger.
Ground workers at Delta (and who were unionized at Northwest airlines) have rejected unionization at the combined airline by a similar vote (52% against) as the flight attendants making it a “win” for Delta.
Everyone likes that Delta has so far maintained the status quo here although I’m sure the former Northwest employees continue to feel uneasy about this. I think it’s good for both parties so far but let’s realize that one reason the elections have gone the way they have is the numerical superiority that original Delta employees have. To be fair, they vote non-union because their experiences at Delta have been largely positive and fair although it would also be right to point out that most of them have never known a different environment.
The key here is that Delta still needs to work on winning over these Northwest employees. They still need to reassure these people and, if anything, work even harder at ensuring their needs are met and that they are being treated fairly in the grand scheme of the new airline. That doesn’t mean they have to bow down to them. It simply means that people can tell when they are and aren’t being treated fairly.
Part of treating Northwest airline people fairly means listening to their concerns and accounting for why those concerns exist: they don’t have a similar history of treatment from airline management at Northwest. Actions speak louder than words and Delta management would be wise to use that as their mission statement going forward with all their labor groups.
American Airlines has announced that they’ll be enjoying an even closer relationship now. In addition to their codeshare/interline agreement, they’ll be adding additional flights including one from JFK to Budapest, Hungary.
Even more exciting, they’ll have a reciprocal frequent flier agreement. (and that’s why moving your reservations system to something real like Sabre is a good idea. Are you listening Southwest?)
American Airlines has announced that it will be offering Happy Hour prices on its drinks in December on flights departing between 5:00 and 5:59pm.
First, that’s a short duration and I already see a problem. Is this scheduled departure time? What if the plane departs 2 hours late? Second, for flights departing in just one hour of each day? Really? Even TGIFriday’s gives you more time than that.
Third, and more importantly, do we really need to be encouraging people to drink on flights? Drunk passengers are a top pet peeve for both passengers and flight crew. It is pretty much agreed among frequent travelers that drinking alcohol on flights is a bad idea. It dehydrates you and the alcohol does seem to have a more measurable effect and can result in things like headaches and bodyaches and a general unpleasant feeling while traveling.
But AA wants you to enjoy a happy hour during your holiday travel. This has bad idea written all over it.
Update (Nov 22, 2010 / 3:12pm CST): I just saw this quote from Janet Napolitano, Secretary of Homeland Security:
“I think we all understand the concerns Americans have,” Napolitano is quoted as saying by The Associated Press. “It’s something new. Most Americans are not used to a real law enforcement pat-down like that.”
Yes, please. Insult our intelligence a bit more for the holiday season. More to the point, let me point out that even if that were similar to a “real law enforcement pat-down” (it’s not and, yes, I know), no one in a line for security at an airport is under arrest or under suspicion and aren’t subject to such overstepping anywhere else in their lives.
Original Entry:
I don’t know if I would recommend “joining” the “boycott” being suggested for Wednesday, November 24th, where people are suggesting that all passengers opt out for being scanned in favor of the pat down as a form of protest.
It’s a poor choice of day because many do have something to lose in being either late or exceptionally inconvenienced traveling someplace for the holiday. It would feel more smart if it were on another day. On the other hand, I can’t actually discourage it either because this needs attention and quickly.
Take a look at what the Denver Post photographed at the local airport HERE. In particular, I think this photo HERE represents all that is wrong w/ these procedures. I’m not sure where exactly the line is but I’m certain that the line has been crossed by a good margin at this point.
TSA chief, Joe Pistole, keeps saying that relatively few people object. I say that this is too new for us to know how everyone feels. In fact, every time I see interviews of people on the street asking if they would subject themselves to this kind of patdown, I believe their “yes” answers come before experiencing this process.
Let’s put it another way. If you saw your family being put through this, would you stand for it anywhere else? I wouldn’t. Take a look at this video:
The father removed the shirt because the boy was too shy to lift his arms for the patdown. Regardless, this is getting more offensive as time goes by and it still happened because of invasive search requirements by the TSA.
And I’ll reiterate my own feelings that whatever a passenger is required to go through, the same should be applied to everyone including flight crews regardless of background checks, etc. If this really is about security, then it should be applied with no holes. I’ll include the President should he ever fly commercially during his tenure in office.
In addition, there is too much evidence that how these procedures are being applied at various airports is inconsistent and indicates, at the least, poor training for TSA agents although I’ll continue to maintain that the people I’ve encountered in the TSA uniform continue to appear to be doing their jobs without real vigilence and seem to be following a policy rather than acting in real concern for security. Read this ABS news story for the latest example (and at an airport where policy just should be flat out known) HERE. If that isn’t enough, see Scott McCartney’s Middle Seat Terminal blog entry about TSA training and an audit on it that was performed recently.
I would suggest writing your congressmen and senators. They are easy to find and easy to email and it is well known that they pay attention to trends in communications they receive from their constituents. In addition, I would suggest sending an email to the ACLU and to your local newspapers. And do it multiple times. These communications go farther in the long run.
The New York Times has a story about Southwest Airlines that you can read HERE. People always like to try to define Southwest and, in my view, often credit them in areas that really don’t apply and miss the point to so many facets of their success.
I’m always a bit amused that a distinction in Southwest’s success is so often low cost. While there is no doubt that offering lower fares is a key component in Southwest’s model, people very often miss the fact that it isn’t a low service model. To the contrary, Southwest delivers on its promises more consistently and with a smile. If anything, it’s their low fares that draw people to the airline but it’s the service that makes them a repeat customer. Let’s not confuse the fact that Southwest has never offered a meal with the lack of service. Better yet, notice that their view on baggage fees is that they aren’t fair and their customers deserve better.
Another component to their success is both effiency and productivity. Southwest doesn’t do anything spectacularly different than other airlines when it comes to running their flights. They still have cabin crew, pilots, ground handlers, gate agents, etc getting that flight moving across the country. The difference is that Southwest has managed to recognize that their people are a weapon for success rather than the “enemy”. They pay well, treat their people well and ask for quite a bit in return. That gives them the edge in productivity. Let’s not fault them for remaining consistent in that policy for 40 years and, frankly, it’s time to stop waiting for the other shoe to drop in that area, too.
Industry insiders like to characterize them as cold and ruthless when it comes to a market. First, let’s not act like this is a daycare playground where everyone is supposed to be treated equal and fair. It is business and in this particular business, competition is almost always fierce. Just because Southwest is able to fight well doesn’t make them cold and ruthless. It makes them a good business with good people.
Furthermore, they are, if anything, often a very conservative company. They study things, experiment, wait for the right moment (and in this business timing is everything) and try very hard to enter new markets when they can do so on their terms, not their competitors. They are who we would wish our bankers of today would be. They aren’t the pirates or the rebels, they’re the responsible people who show a great deal of concern for their stakeholders.
Do they look for weaknesses? Absolutely. Is it smart to enter a market where an incumbent has an overwhelming advantage in every way over you? Of course not. Timing, as I’ve already said, is everything. Just because another legacy airline is weak and unable to do business on any real world market terms doesn’t mean that Southwest should treat them with kid gloves. That other airline’s weaknesses are opportunity and it’s nothing that anyone else in any other business wouldn’t try to capitalize on.
I’m all too often amused at how SWA is made out to be someone clinging to their business model after all these years and how so many perceive them to be unable to change. Their so agile that they’re moving in new directions while other airlines are still figuring out they have a problem.
They went sexy in the 70’s and no one ever noticed they went business casual in the 80’s so that their own appearance would match their customer’s own model. They’ve stuck to the 737 but they’ve driven that aircraft’s design changes over the years with their own needs and few have ever noticed that. It’s remarkable that one airline could hold such an influence over a business like Boeing and not manage to sell itself it out in the process.
When there was war in the early 1990’s that suddenly impacted their business, the entire company recognized the needs to reduce costs immediately and did so in a matter of days while other others languished in the markets bleeding red in bright streams. When fuel became a much more uncertain commodity, they became an early adopter of fuel hedging in order to make those costs much more certain and predictable.
When they found themselves with no more underserved markets to enter, they didn’t stagnate, they reinvented themselves and began entering larger and larger markets. Instead of rushing into places at any cost, they charted a course that required them to meet their own criteria for entering a new market and then executed flawlessly. If you had asked anyone 3 years ago if they would ever enter the New York City market properly, no one would have bet on that including me. Now they’ve got a plan to serve it via 3 airports (La Guardia, Newark and Long Island).
It’s hard to call an airline as old as Southwest a new entrant. Frankly, I don’t they are a rebel either. I’m not sure they were ever rebel. They simply run their business better than virtually anyone else and they do it so consistently that no one ever seems to quite believe that there isn’t something hidden. I think the markets treat Southwest as that family relative you can never quite believe has it together that much since it doesn’t match what everyone else in the dysfunctional family is doing.
Is Southwest becoming a legacy airline? No, not really. They are simply not following the crowd in everything they do. They follow their own path and sometimes that means they are in step with the crowd and sometimes they aren’t. Reading too much into it just results in speculation that doesn’t match fact.
I was a somewhat early adopter of Airtran starting with some flights in the late 1990’s and for a variety of reasons, the airline just worked for me. No one would describe Airtran as having a luxurious service product but, somehow, it was a service product that found a fan base.
Now there are many Airtran Fans who are lamenting the merger between Airtran and Southwest Airlines and what it means for Business Class. Right now, it means it’ll be going away.
I think that’s a mistake. The way Airtran operated their business class was somewhat unique and was a great upsell for many passengers including me. I have often arrived for a flight and paid the upgrade fees at the spur of the moment although I have to say that buying that upgrade at the last minute has gotten to be pretty difficult.
Airtran’s business class is a bit special. It’s really more a decent seat, a few free drinks and a ride at the front of the bus. It isn’t a luxurious “total experience” that a SuperLegacy might offer but it does embody the 3 best parts of riding in a business class product.
And at the price it was offered at, it not only made money for Airtran, it also didn’t tax Airtran’s LCC service model either. Airtran didn’t have to dedicate one of the cabin crew to that section to rub the toes of those passengers and it didn’t have to carry meals either. They did their drink service and when in the front of the bus, they didn’t charge for the first couple of alcoholic drinks.
What I’m really saying is that Airtran’s business class actually *does* embody the Southwest service model. It is the Southwest service model translated by Airtran into a business class product.
In fact, I think you could retain it and toss assigned seating to the wind and few, if any, would even pause over that.
But here is the thing: it’s time to get over the idea that Southwest is the champion of the little people and it’s time to get over the idea that Southwest is completely egalitarian.
They are neither and, in some respects, they never were. Southwest was successful in Texas because it offered fast travel between city centers for the new breed of businessmen: entrepreneurs. It is true that Southwest did stimulate first time travel in people as it grew across the country but those days are over too. The 1980’s were a period when air travel became accessible and it was solidified in the 1990’s but the idea that there are a great number of people in various markets who have never considered air travel until Southwest (or other LCCs) showed up is disingenuous at best.
More to the point, an Airtran business class product is well suited to the Southwest frequency model that is still employed today. Imagine the revenue opportunities that exist in their newest markets from New York City to destinations like Chicago, Baltimore, Washington DC and Houston.
Southwest has matured in many ways and all for the better. Retaining a business class product like Airtran’s offers far more opportunity than it does risks and for SWA to dismiss it out of hand is a flawed move. Keep it, play with it and look for advantages. Use it to start eroding the appeal that newer LCC models like jetBlue and Virgin America have built up. If you think it’s the in-flight entertainment those airlines offer that is driving their business, you’re kidding yourself. It’s the better seat at the better price where they compete against legacy and SuperLegacy airlines.
Southwest’s quick move to announce it would go away struck me as inflexible and particularly so given their agility in most things. Yes, they are slow adopters, experimenters and generally an airline that waits for scale to develop before they make a move. The scale is there, Airtran is a ready experimentation and they’ve already adopted a number of features to better accommodate business travelers.
For all you Airtran Business Class Fans, I’m with you. It’s worth keeping not just because you like it but because it has all the appearances of being a solid business choice.
British Airways cabin crew union, Unite, has decided that it cannot recommend the latest deal and put it to a vote among its membership. Now it wants more talks with British Airways.
And I would like to offer this: That’s bargaining in bad faith.
When you are the leadership of a union and engage in talks that result in a proposed agreement and you agree to put it to a vote, you damn well put it to a vote. You don’t change your mind and then ask for more talks on threat of another strike. Being weak and changing your mind just damages the process for both sides. If your membership doesn’t like it, they won’t vote for it. The outcome is the same but it’s an outcome that results from an appropriate course of action rather then a cowardly one.
I didn’t like BA’s punitive moves against the cabin crew and I did think that gave Unite the upper hand somewhat. Now I think they’re both behaving atrociously and contrary to the spirit of what it means to negotiate a resolution. One thing I can’t criticize British Airways for is being cowardly and indecisive. Unite loses the upper hand here and goes back to wallowing in deep mud.
I have to be honest, I thought Donald Nyrop was already dead. I was wrong.
Donald Nyrop died on Tuesday, November 16th, at the age of 98.
I’ll wager that quite a few younger airline fans may not even know his name. Nyrop was one of the Titans of the airline industry and served as CEO of Northwest Airlines. He should be thought of in the same category as Robert Six (Continental), Juan Trippe (Pan Am), Jack Frye (TWA) and CR Smith (American Airlines) in my opinion.
Nyrop was a former government lawyer who ran Northwest as frugally as possible. American Airlines is known for leaving their aircraft unpainted to save money but Nyrop did it for the same reason. He kept their headquarters in Minneapolis in a non-descript building near the airport and he often fought with his airlines’ unions during his tenure.
But he is the man who made that airline what it was and certainly it embodied his spirit in some form or fashion and for good or bad right up to the point it merged with Delta. Don Nyrop retired from the Northwest Airlines board all the way back in 1984 leaving a legacy of frugality and safety. Not many men could navigate those two prioties with the success he did. Northwest was the airline that pioneered things like forecasting clear-air turbulence, for instance.
He wasn’t without his quirks. Nyrop reportedly became convinced that employees were lollygagging in the restrooms reading newspapers and once had the doors to the stalls removed to stop it. Like many other airline leaders of his time, he was also known for being very solicitous of his employees and looked after their well being with many simple, undeclared acts of kindness.
He was tough with aircraft manufacturers and their salesmen and demanded safe aircraft that met Northwest’s needs. He standardized their operations as much as humanly possible in his time insisting that aircraft all have the same configurations including engines. He insisted on the best navigational equipment for Northwest’s routes to Asia and employees respected the way he made money in a business where that quality is rare.
I’ve often tried to find a biography on this man. I always wished that Robert Serling had written about him and this airline because its a story that I suspect hasn’t been fully told. Serling would have told it best, I believe.
I find it a bit sad that his obituary appears only in the Minneapolis St. Paul Star Tribune because it should be noticed in so many more places given his contributions to both Northwest and aviation. It’s even a bit sadder that Nyrop goes unmentioned even in the Wikipedia entry for Northwest Airlines (as I write this anyway). So, if you happen to see a Northwest aircraft, especially one of the old DC-9’s, raise a hand and wave because it was bought under Nyrop’s leadership and it’s really quite remarkable that it continues to fly on today.
The great argument driving TSA rules on x-ray machines and patdowns derives from what was, quite honestly, a horrible act on September 11, 2001. We’ve been treating air travel with high security for 4 decades starting with hijackings that resulted in bombs and deaths resulting from other horrific acts. You have to acknowledge that air travel has, in fact, been used as a weapon and as a terrorist act more than once.
These acts have, in my opinion, driven us to accept conditions upon our free movement inside this country that we don’t accept anywhere else. In fact, we are asked to accept conditions in order to travel by air that we don’t accept in virtually any other place in our lives. Let me point out that we aren’t asked to accept this level of scrutiny in order to enter a courthouse, the Capitol, a military base or even the White House. Even with respect to the real world, we aren’t asked to endure this scrutiny to visit a federal building or a movie theater or restaurant. Think about that for a minute: we aren’t groped (sexually or otherwise) in order to proceed about our lawful business in virtually any other setting.
I am far from suggesting that there be no security checks in airports. To the contrary, I believe that there is a level of security that should be applied and applied evenly and without regard to race, religion, etc. There should be absolutely no exceptions for anyone including flight crew.
But I do think we’ve gone too far and I do think that we, the public, have been far too accepting of the latest indignities and, quite frankly, inappropriate searches of ourselves and our personal belongings all in the name of “security”. This is making the free movement about our country a privilege rather than a right and I’m extremely uncomfortable with that. And to argue that there are other choices is disingenuous at best in this modern age.
What we’re really doing is carving out exceptions to basic and derived rights on the basis of security theater rather than real security.
It doesn’t just exist at airports although I think airports are the most extreme case. Recently, I’ve made a number of trips to McAllen, Texas. Ironically, by car and I’ve witnessed behaviour on the part of several law enforcement agencies that I honestly believe would not only not been tolerated but soundly stopped just 20 years ago. Imagine traveling 90 miles and seeing 18 State Trooper cars, 5 Border Patrol cars and a mandatory checkpoint where you are interrogated and potentially asked to consent to a search before simply proceeding about your lawful business.
Privacy in this country has traditionally been a very sacred subject. The right to privacy, to not incriminate oneself and even the right to engage in lawful business between two areas has been infringed upon to a degree that I think it’s changing our country.
It’s time we start accepting that this world is not and has never been a perfectly safe place and to attempt to make it so does far more harm than it does good. I’m rather shocked that people haven’t challenged these acts in the courts (is the ACLU really that docile now?) and that we haven’t complained rationally and loudly to our lawmakers and policymakers.
For the record, I have written Congressmen and Senators and I think others should too. Also for the record, I am not a libertarian or conservative or liberal. If anything, I’d be identified as a moderate Democrat that find himself largely unrepresented by either side.
My standard in feeling revulsion at these developments has come from the fact that I’ve realized over the past few years that I actually feel more exposed and less safe as a result of these security measures. They don’t reassure me and they don’t make me feel that my plane has been adequately protected from threats.
I do think there are measures we could take and if we’re really serious about security, why aren’t we hiring bright and capable people to perform our security roles? Furthermore, why are we endorsing a para-military approach to security at our airports when we find that, time and again, this mindset doesn’t result in greater security to ourselves.
I have a great fear that we are going to abrogate more and more rights in this quest to perceive ourselves “safe” that any value we derive from being citizens and residents in a country with uniquely protected basic civil rights will be simply gone. And I wonder if that isn’t a “win” for terrorists as well.
Just in case you think I’m the only one out there disturbed by these many farces, read FL250’s post HERE.
When the Air Transport Association offers nothing much but criticism of new pilot fatigue rules, I have to call foul. Pilot (and cabin crew fatigue) is something that has gotten worse and worse, not better over the past few decades. In the drive to increase productivity, union rules and contracts have been renegotiated over and over resulting in less and less rest for crew members.
There was a time when getting that increased productivity was a reasonable thing because other factors affecting fatigue weren’t nearly the issues they are today. One of the biggest issues is commuting and its a necessary evil in the airline world. Pilots often have to commute from their home to their home base and that can mean flights anywhere from a short hop to a transcontinental flight.
When that home base is stable, arranging and managing those commutes can be done. However, home bases are often anything but stable these days as airlines have expanded, contracted, expanded, merged and even grown into entirely new regions. Pilots are being moved around like inanimate objects and that leads to fatigue. Fatigue doesn’t just come from lack of sleep. It comes from commuting, stress, poor food and difficult schedules.
This stuff just has to be managed better and I throw a red flag at the ATA. Don’t just criticize, solve the problem. Being a player in getting this issue solved. Behaving as if nothing has changed over the past 2 decades is sticking your heads in the ground just as badly if not worse than the unions have at times. Find ways to offer some stability and productivity and get those people better rested. We’ve had one air disaster that clearly saw fatigue playing a role. The fact that it was a small commuter aircraft that time doesn’t mean it won’t be a large widebody next time.
I’ll add this: unions need to get smart. Demanding everything in terms of rest, wages, etc without finding a way to offer more productivity is a losing game and puts you in the penalty box with the ATA. If you don’t find a way to come to some understanding on this, it will fall to the government and not a single person out there will find the solution satisfying or effective.
It’s been announced that jetBlue and Emirates will have an interline agreement functioning through JFK airport and within the next few days, it will be possible to buy thru passage to destinations between the two airlines. JetBlue has been arranging and aligning itself with a number of airline partners through this type of agreement and Emirates makes the seventh such agreement. American Airlines was announced just a few months ago and jetBlue has been enjoying an arrangement with Lufthansa (a major shareholder with seats on the board) for some time now.
CEO Dave Barger has described this as an open architecture and that means they are doing deals with whoever it makes sense to do a deal with. The problem is the potential for conflict among the various partners. For instance, one can only imagine how amused Lufthansa was to learn of this since their CEO has been a vocal critic of the advantages that Emirates enjoys in international travel.
This isn’t exactly new. Alaska Airlines has been engaged in similar practices with a variety of partners both domestic and international for years. In Alaska Airlines’ case, it’s made sense and worked to a fair degree although in part because Seattle, it’s hub, is not a hub or really a focus city for anyone else. However, over time, Alaska did business with so many partners who were competing with each other individually, it began to annoy some. For instance, AA has been gradually drifting away from its partnership with Alaska and Delta has been strengthening this partnership.
Ultimately, Alaska has found that it really does, in a sense, have to dance with the partner who is making a difference to their bottom line. Of late, that’s been Delta and when one airline substantially bigger than you starts contributing significant revenues to your balance sheet, it is only a matter of time before it starts conditioning those results upon receiving certain concessions.
JetBlue sees opportunity and there is opportunity at present from all of its partners. However, over time, someone is going to start making a bigger difference to the bottom line than someone else. Emirates has great potential for this as does American Airlines. Just between AA, Emiratese and Lufthansa, you have two airlines aligned with different alliances and one airline who isn’t but who knows how to provide massive long haul feed. The potential for conflict is huge in the future.
Maintaining some kind of balance between its partners is going to be key to keeping this open architecture. Like any business, dependence upon one partner can lead to inequalities that drive your business in directions you never wanted to go in. The size of airlines that jetBlue is partnering with indicates just how massive that potential is and no one should ever make the mistake that a huge airline won’t one day decide to use its influence to diminish the influence of other airlines its competing with.
Frankly, I think it benefits a small airline to pick a dance partner and stick with it. If jetBlue wanted to enjoy feed from other airlines, it would have been better served to have chosen an alliance and worked within its system where there is some understanding that picking apart a partner is counterproductive. Under the current model, no one partner has any great incentive to remain loyal if the competitive environment evolves.
Damned if you don’t. American’s labor woes are getting in the way of both the company and labor moving forward. It’s a Mexican stand-off at this point. Management has the argument that any higher labor costs would result in the company losing money again and potentially failing. If it runs close to the line of failing, it’s either a liquidation (unlikely) or a bankruptcy reorgnization (very likely) or a purchase (somewhat likely). In any of those situations, labor stands to lose and lose big.
Labor, on the other hand, has a knife to the throat(s) of current management. If they win big gains, it’s the end of the current regime. If any of the unions (particularly cabin crew or pilots) win the right to “self help” aka a strike, it’s the end of the current regime. And the the end of the current regime may mean a reorgnization ultimately as well.
Neither side can necessarily afford to stick with their current leadership. AA’s management has allowed this to fester for a very long time and, I think, has gone past the time that would be regarded as “reasonable” to come to some agreement that would allow the company to move forward. At least in the eyes of many shareholders. Likewise, the unions don’t have a deal and don’t have a prospect of a deal and with the stance of “all or nothing”, stand to harm their memberships far more than help them.
We’ve already seen the pilot’s leadership change to a more reasonable president but I see no evidence of that potentially happening among the other groups. Not right now.
If the brinksmanship continues, look for a regime change at AA. If there is a regime change at AA that does not result in movement in the agreements, look for regime change of the leadership of flight attendants. Then sit back and wait for the bankruptcy filing for reorgnization.
What seems even more dismal is this question: Who wants to buy AA or American Eagle?
It’s never good when something bad happens and a manufacturer dribbles information out. Rolls Royce has a PR problem that is about to get much worse before it gets better. The latest news is that Rolls has acknowledged the potential for oil fires in their early Trent 900 engines now and it appears there have been a couple of quiet upgrades in the time the engine has been in service.
One wonders why it has taken more than a week for this information to come out and one also wonders what else hasn’t been discussed. It’s understandable for a company to want public discussion to be about fact rather than speculation but you don’t manage speculation by withholding all the facts. We see manufacturers do this time and again in all industries.
It never works out and it always has the flavor of deceit whether or not deceit really was a part of the intent. Full disclosure reassures people and, most importantly, it’s the only right thing to do.
If there are potentially related problems on the Trent 1000 engine for the 787, Rolls Royce would be well advised to start that dicussion now rather than let it lay fallow for months only to have it erupt again. The public understands a mistake, it doesn’t understand things being covered up.
With the QANTAS A380 fleet being grounded for several days, one thing was clear when it comes to this aircraft.
When one of these aircraft becomes unavailable, there can be a huge number of people needing to be cared for. QANTAS’ A380 carries as much as 450 passengers and their typical equivalent 747 carries just 307 passengers. For most routes that the A380 would fly, you would require generally 2 other long haul aircraft to deal with the extra burden. By 2 extra, I mean you would need two 747-400s to get passengers cared for on a LA-Sydney route or two 777-300’s or at least two 777-200s.
But my larger point is that when you fly this aircraft, a cancellation can inconvenience from about 450 to 550 passengers with just one flight cancellation. That’s a lot of people to take care of and airlines had best have a contingency plan to deal with such an eventuality because it is not like a single 737-800 cancelling. It’s not even remotely like a 767 or 777 cancelling.
It doesn’t appear that QANTAS has had much of a handle on dealing with their customers problems either. To be fair, it’s not easy to ground those aircraft and then dispatch 747s to outlying destinations to take care of passengers. The flight time alone between Sydney and LA is generally well in excess of 14 hours. And it’s not easy to keep a spare A380 laying around either. It’s not even easy to keep a used 747 lying around for backup.
Then again, it’s not like there will ever really be a huge fleet of A380s in the world either. Unless Emirates defies all predictions and really does take delivery on all of their orders.
Over the past few months, we’ve seen a few airlines announce their intention to carefully stick their foot into the DFW market. First it was Virgin America with flights from both San Francisco and Los Angeles to DFW. Next up, Spirit Airlines decided to try things out a la Allegiant style to Las Vegas and Fort Lauderdale.
I think Virgin America has every chance of making a go at this and, frankly, may be just a bit late in their timing. This is the perfect time to go against American Airlines with a superior service product and Virgin has it. The trick will be in enticing business customers in the DFW area and with the right kind of local advertising, they’ve got a shot.
Spirit Airlines has visited DFW, briefly, once before. This time they’re offering flights to Fort Lauderdale where passengers can connect to their Caribbean flights. Then they have their Las Vegas run which should potentially do OK given the current fares to Las Vegas from American Airlines. I suspect that with any challenge from AA at all, they’ll drop that route like a man pulling weeds who finds his hand full of rattlesnake.
The real question is will Dallas embrace an Ultra Low Cost Carrier? Maybe. This is a fickle city that has firm ideas on what airline service is. Southwest has spoiled us and I don’t know if Spirit’s “Ryanair-like” attitude will go down well here. I’m personally intrigued by Spirits offerings because if they schedule things right, I might be interested in trying them out all the way from DFW to Colombia.
I’m glad to see some new airlines show up but let’s not get carried away. These airlines are simply sticking a toe into market to see the temperature is right.
The first order for the Airbus A380 in Japan is being announced and isn’t an order from All Nippon Airlines or Japan Air Lines. Instead, it comes from tiny Skymark Airlines who operates the 737-800 (although they did operate the 767-300 for a while) and who is hubbed at Tokyo’s Haneda airport with an additional focus on Kobe.
The order is for 4 aircraft with options for an additional 2. Delivery dates are unknown and this order still has to be “firmed up” within the next few months.
It’s difficult for me to call this a vanity order or a political one for that matter. This airline is too small for either condition. With the order book for the A380 essentially covering the next several years, this is like an order that will be scheduled far in the future.
But it doesn’t make sense. This airline doesn’t have a network to feed an A-380 and using the A-380 for domestic flights essentially abuses it capabilities. It would be much easier and offer more flexibility to use 2 767-300s or 777-200/300s for domestic use than it would be to use one A-380. Supposedly Skymark will use these for international flights but, if so, I have to ask where they’re going to use them and just what kind of network do they plan to have to feed these animals day in and day out?
Filling a 500 passenger aircraft for international flights every day is no trivial task and given Skymark’s business model, they may well be thinking of well in excess of 500 seats per flight. Yes, on a theoretically full flight, your flights would be incredibly profitable. The problem is, it’s unrealistic to plan for “full” year round.
This may be just a fancilful pursuit that will never be realized and I wouldn’t be surprised if we find that out in another 3 to 4 years.
Update(Nov. 9th, 2010) : According to the Vancouver daily newspaper, the couple was contacted last night (Monday, November 8th) and offered full compensation for their ordeal.
. . . like a family scorned. Expecially a family that understands social media.
I found out about a problem that a family recently experienced on Alaska Airlines and read the blog that was created by this family after their ordeal. You can read it at: http://alaskaairhatesfamilies.blogspot.com/
A lot of bloggers have spoken of the power of social media with airlines over the last year. It offers a pathway for redress of certain grievances that previously would have been ignored by most airlines.
First, all airlines make mistakes. All airlines have employees who handle a bad situation badly. The rules described by Alaska Airlines in defense of their actions are certainly true. You’re expected at the gate and available to board at a certain time.
But there is a difference between a gate agent standing there wondering where a passenger is who should nominally be there and available to board versus a gate agent who is being communicated with by a passenger who is experiencing a problem that will be solved in a few minutes time. This is when you want your employees (even your contract employees) to show some good judgement.
Allowing this man to board with his family would have cost *nothing* in terms of departure time and little extra in terms of stress on the gate agent. When a passenger is communicating with you over a problem, stop and take the time to listen and work with them. Why? Because the costs in terms of reputation when that same family starts a blog that gathers national media attention are far greater than the costs of taking a few extra minutes to work this out.
If you think the costs to your reputation when something like this goes viral in national media, you have no idea of the costs you incur when you respond with “these are our rules, here is a token payment to shut up”. Again, you want your people at the airline examining these things and showing good judgement. This was an opportunity to “win” in the eyes of the public and get back a reputation that is pretty good.
All Alaska Airlines had to do was compensate the costs of the ticket and publicly apologize. This would have won the customer back and won the public opinion back, too. Defending yourself by citing rules is only going to make things worse at this point and when you do that, you increase the public perception that you don’t play by real world rules and people begin to think that you’re just “out to screw them.” When you behave that way, it’s hard to conclude otherwise.
It wouldn’t have been necessary to over-compensate these people. Just make their increased costs go away. Make them feel as if they been listened to by ACTUALLY LISTENING TO THEM AND APOLOGIZING.
One of the biggest mistakes Alaska Airlines made in all this was allowing the social media guy at Alaska address this by citing rules. Use your executives to cite rules, use your regular PR representative to cite rules but don’t let your social media face get associated with this mud bath. Social media is about being friendly and service oriented. Not only did Alaska Airlines damage their general reputation, they damaged the reputation of their social media efforts in a way that now few people will have trust in it as an outlet for anything helpful or useful.
And social media is only going to get more important in the next few years, not less.
