More Than Points

We here at MTP usually focus on trends in the travel industry, rather than personal experience. However, a recent travel experience hits on an issue related to fuel economies and airline operations. I was recently traveling on a US Airways flight from Washington’s Reagan International (DCA) to Fort Lauderdale, FL (FLL). The weather en route was generally fine, though we did hit some headwinds and had to be routed around Tropical Storm Fay in northern FL.

As we neared our destination in South Florida, the flight had to be "re-routed" to stop in West Palm Beach (PBI) to pick up additional fuel. For those not familiar with PBI and FLL, they are 42.6 miles apart (give or take). Pilot said we had to stop and get gas; this turned into an extra hour for the flight to go the additional 40 miles.

It begs the question of just how low our fuel level was that the pilot was unable to go the extra 40 miles (or so). I’ve read some recent complaints that US Air is reducing the excess fuel on board to cut operational costs. Here are a few articles about how the pilot’s union is responding to pressure from the airline

http://www.azcentral.com/arizonarepublic/news/articles/2008/07/18/20080718biz-usairways0718.html

http://cbs2chicago.com/national/us.airways.pilots.2.772910.html

To collect more details, I posted this message to a forum on the FlyerTalk website; feel free to read the responses of your fellow road warriors. Out of this whole experience, we did find a very interesting website which allows travelers to see the actual flight path taken by their pilot called FlightAware. Here is the actual path of my flight.

And that was how my day went.

Delta, following the lead of its competitors, has announced plans to rollout wireless broadband internet access on all its domestic mainline fleet by mid-2009.

"Delta is joining with Aircell®, a 17-year leader in airborne communications for business and commercial aviation, to install the company’s Mobile Broadband Network on the carrier’s domestic fleet. The system, Gogo™, will enable Delta customers traveling with Wi-Fi enabled devices, such as laptops, smartphones and PDAs, to access the Internet, corporate VPNs, corporate and personal e-mail accounts, as well as SMS texting and instant messaging services.  Gogo will be available to customers for a flat fee of $9.95 on flights of three hours or less, and $12.95 on flights of more than three hours.
“Delta remains committed to providing a travel experience that maximizes the time our customers spend with us onboard by offering them even more productivity options,” said Richard Anderson, Delta’s chief executive officer. ”Our customers asked for in-flight connectivity, and we’re responding by rolling out the most extensive Wi-Fi network in the sky.  Beginning this fall, our passengers will have the ability to stay connected when they travel with us throughout the continental U.S.”

Gogo will be offered initially on Delta’s fleet of 133 MD88/90 aircraft and will rapidly expand to the remaining domestic fleet of more than 200 Boeing 737, 757 and 767-300 aircraft throughout the first half of 2009. The airline expects to have more than 330 aircraft complete by summer 2009.  The full fleet agreement between Aircell and Delta will provide a consistent, convenient experience for customers traveling on the airline who wish to use the Gogo Internet service."

Here is the original article from Delta’s News Room. By the way, American has already started this service on their 767-200 fleet; here is a review of the service by WSJ reporter Walt Mossberg.

A recently released Senate report estimates that flight delays in 2007 cost passengers, airlines and the broader US economy more than $40 Billion. Take a moment to absorb that figure. $40 Billion from lost productivity, added operational costs to support delays, increased jet fuel consumption, and impact to other industries.

Here are a few key findings from the Senate’s Joint Economic Committee Report

• The total cost of domestic air traffic delays to the U.S. economy was as much as $41 billion for 2007 including higher airline operating costs, lost passenger productivity and time, and losses to other industries.
• Delayed flights consumed about 740 million additional gallons of jet fuel totaling $1.6 billion extra in fuel bills. 
• Passengers were delayed by a total of 320 million hours, when accounting for padding in airline schedules.  Almost 20 percent of total domestic flight time in 2007 was wasted in delay. 
• Flight delays were longest during summer vacation months. Flight delays during the months of June, July and August averaged approximately 414,000 total hours of delay per month. Flights during December – the height of holiday traveling – totaled almost 438,000 hours of delay.
• 78% of flight delays in 2007 occurred before take-off, with 58 percent at the gate, and 20 percent during the taxi to the runway.
• 94 percent of all flight delays were caused by other flights arriving late, national system delays, or air carrier delays (less than six percent of delays were due to security or extreme weather)

The three largest airports in the New York City area, JFK, LaGuardia, and Newark airports had a total of over 40 million passengers last year.  The New York City area airports combine for more than 27 million hours of passenger delays.And the average per-passenger delay at these three airports is nearly 28 minutes – among the highest in the nation. 

The full report and the technical appendix can be found here

In advance of your next trip, keep an eye on whether your connection takes you through any of ’America’s Most Time-Draining Airports’. Maybe you’ll seek a new route to your destination

Can you imagine what you’d do with that extra 20% of time spent currently in airport delays?

The Travel Industry Association commissioned a recent study on the state of the travel industry. Roger Dow, president and CEO of the Washington, D.C.-based association, said the research "should be a wake-up call to America’s policy leaders that the time for meaningful air system reform is now." "The air travel crisis has hit a tipping point – more than 100,000 travelers each day are voting with their wallets by choosing to avoid trips," Dow said in a statement.

From this study, we gleaned some very interesting nuggets worth sharing

• Nearly half of American air travelers would fly more if it were easier, and more than one-fourth said they skipped at least one air trip in the past 12 months because of the hassles involved.
• The 41 million forgone trips cost the travel industry $18.1 billion – including $9.4 billion to airlines and $5.6 billion to hotels.
• The lost tax revenue to federal, state and local authorities equals $4.2 billion in the past 12 months.
• When 28% of air travelers avoided an average of 1.3 trips each, that resulted in 29 million leisure trips and 12 million business trips not being taken
• 44% of the air travelers surveyed said they would take more air trips each year if airport hassles could be reduced or eliminated
• People who flew more than five times in the past 12 months were more likely to describe air travel as frustrating, at 52 percent, compared with 33 percent of infrequent travelers, defined as people who flew one or two round trips in 12 months, according to the survey.
• More than half of respondents said either efficiency or reliability is getting worse, 60 percent said the system is deteriorating, and 56 percent said flying is the "bad" or "worst" part of travel – though 62 percent said air travel security is improving

I’m surprised that only half of flyers find air travel frustrating. When was the last time you ran into someone who enjoyed their flight?

In other words, they are reducing costs at your expense.

What This Means to You:

• Less planes
• Less airline staff
• First checked bag fee $15
• In-flight beverage "purchase" program
• No more bonus miles with Preferred status

“US Airways is also eliminating its bonus miles program for Preferred status Dividend Miles members. Preferred members currently receive mileage bonuses based on their status level. The Preferred bonus program will be discontinued for tickets purchased on/after Aug. 6, 2008.”

• Increased fees for booked at airport or through call centers
• "Redemption Processing Fee" for using Dividend Miles

I hate being the bearer of bad news.

This is just another sign, airlines are moving towards an "a la carte" menu to extract additional dollars from their customers.

In business school, this approach involves extracting additional customer surplus to maximize company profits.  By further segmenting the flying population, the airlines can extract additional surplus which it was giving away on a first come, first serve basis.  With oil prices at a record high, airplanes are competing to stay in business, not steal away customers from other airlines.  By cutting down on flight schedules, seat capacity is now in short supply so there is no concern about flying empty airplanes.  In a market with limited competition, the customer will pay the price. 

Just when you thought it was over…

Here’s a few choice quotes from the article:

"…the combination of reducing seating capacity within the airline’s fleet, moving toward an a la carte system of charging fliers for such things as checking bags, eating and drinking, along with expense reductions, will save the Tempe, Ariz.-based carrier $500 million annually."

"In addition to charges for baggage and refreshments, US Airways has raised the $15 charge to book flights through its call center to $25 for domestic flights and $35 for international flights. The $20 service fee to buy a ticket at an airport or city ticketing office increases to $35 for domestic travel and $45 for international travel."

"Most airlines except Southwest have announced capacity and personnel reductions, and a la carte charges."

"Fare-paying now looks like the customer is just paying the base price for the flight…You want doors – that’s going to cost you more."

"Right now, you’re dealing with a panicked industry which, after fuel costs, is making about 30 bucks a seat…If they can get an extra $10 out of a passenger, that’s a 33 percent increase. The industry already has sold most of its product for July and August below cost."

Don’t hold your breath - you can expect the other airlines to follow shortly.

This is good news.  It’s better than Continental and United merging.  It means your points can be used to get to more places (with the potential for less layovers) and you have access to more airport lounges all without the consolidation of flight segments that usually happen with a merger.  It’s an unexpected gem amid all the cost cutting and ala carte pricing we’ve been pummeled with in the past 6 months.

If you fly either airline you will enjoy the flexibility of the many more airports available to you since every Continental hub can be considered a United hub and vice versa – assuming it gains regulatory approval.

The email follows in all its entirety.  Have an excellent weekend!

Dear Mr. point man,

As a valued Mileage Plus member, we wanted you to be among the first to hear that Continental and United today announced plans to cooperate globally, linking our networks and services worldwide to deliver new benefits to you. In addition, Continental plans to join United in the Star Alliance®, the most comprehensive airline alliance in the world.

 
Once implemented, this new partnership, will easily enable you to take advantage of the resources of both airlines to enhance your overall travel experience, and receive more value from your Mileage Plus membership.

First and foremost, this partnership will include new frequent flier reciprocity that will enable you to earn miles when flying on either airline and redeem awards on both carriers. Travel on either carrier will count toward earning elite status. Similarly, members of either airline’s airport lounge program will have access to both Continental’s Presidents Club network and United’s Red Carpet Club® lounges.

Second, together with Continental, we will be able to offer you a more comprehensive domestic route network and together with our Star Alliance partners, greater choice of service throughout the entire world.

Starting in the U.S., you are going to see United and Continental develop extensive code-sharing that will facilitate travel whenever your itinerary involves both carriers. We will be able to provide you with a coordinated process for reservations/ticketing, check-in, flight connections and baggage transfer.

Internationally, Continental and United will establish joint ventures that will allow us to cooperate with each other and with other Star Alliance airlines throughout the world. These joint ventures will enable us to provide you with highly competitive flight schedules, fares and service to more destinations than we do today.

In short, once regulatory approval is obtained, this new partnership between United and Continental will expand your choice of flights and destinations, and improve your ability to earn both miles and elite status in Mileage Plus. Together we will offer you more value whenever you fly. We expect to bring you the benefits of our cooperation starting some time in 2009, and until then, we will keep you informed about our progress.

 
We appreciate you and your business, and we look forward to seeing you on your next flight.
Sincerely,

Robert Sahadevan
Vice President – Mileage Plus

USA TODAY has a very good read which highlights what to expect in the next year regarding flight schedules.  It’s not pretty, especially for those of you who travel out of non-hub cities.  Some tiny airports will lose the majority of their air service as smaller carriers such as Mesa Airlines fall victim to the high fuel prices (currently @$130/barrel).  Regional jets, a popular choice for smaller cities and shorter routes are no longer profitable at these oil prices so many airlines are planning to ground these types of planes.

The fall-out for travelers:

• Higher fare prices as reduced competition allows airlines to raise prices on less profitable segments
• Higher travel times in the form of less non-stop flights and more required connections
• More crowded planes as people squeeze into the available flight schedules
• Less flexibility in travel times and dates, especially for vacation destinations

We may not see this immediately, but it will hit us at some point depending on where we are departing and where we are going.  There’s not much we can do to prevent high oil prices, but you can minimize the impact to your travel plans by planning early.

As frequent travelers, sometimes our flight schedules are fixed so book out as far as possible.  Southwest gives you an edge as there are no costs for applying unused tickets to other Southwest ticket purchases.  The same cannot be said for all the other major airlines.

Plan your vacations and book early to get the dates which fit your schedule.  If you wait too long, you may not have the option to get on the flight and if you do, you may be paying up the nose for the few seats remaining.

In any case, expect higher prices regardless of when you plan to fly in the future.  Play it smart and don’t procrastinate.  Have a good week.

A reader passed on an interesting article from CNN’s travel section which relays some confessions of an ex-airline agent.

There are a few interesting tidbits which give some transparency into the inner workings of airline travel.  It appears the poor financial outlook for airlines is driving down the level of customer service (oh really?).  Poor training, low wages and non-existent perks result in ill-equipped agents manning the front-lines.  An antiquated hodge-podge of systems only add to the difficulties in servicing you - the customer.

The best thing to do is remain calm and have patience regardless of the situation.  While "free" upgrades are a thing of the past, being friendly and courteous can be the difference between spending another night at the airport and getting home to see your family and friends.

And in case you were wondering, there is a way for agents to pass their experiences with you to other agents.

Ticket agents are always updating Passenger Name Records, or PNRs. These computer files, which contain basic details on passengers’ trips, are accessible to most agents at check-in counters and departure gates.

Agents generally use PNRs to record special requests by passengers, but sometimes they also comment on a person’s behavior.

A friend of mine discovered this after she had a heated argument with a ticket agent about getting an upgrade on a flight to London. When she reached her gate and inquired again, the agent remarked on her "inappropriate behavior" at check-in, and my friend was stuck with her economy-class seat.

Good to know.  Safe travels.

Straight from my email box to your favorite frequent traveler blog.  For those of you looking to rent cars for the weekend, you can use the following promotions to earn double award points and 50% off weekend rentals.

Non-airport locations: PC# 118510

Airport locations: PC# 118506

Details can be found here.

Drive safe.