November 2007 Archives

There’s an interesting job change at Delta. The airline’s executive vice president for operations and former chief pilot, Joe Kolshak, decided to retire after 20 years. A natural pick for any film casting director to portray a classic firm-jawed, confidence-inspiring pilot, the 50-year-old Joe (right) is going to take it easy. His replacement comes from two other consumer-oriented companies that at first blush don’t seem to have too much in common with the airlines. Steve Gorman will be joining Delta from Greyhound, the only remaining nationwide US bus company - the butt of innumerable jokes about vagrant-filled terminals and the name that's often invoked when flyers want to decry the decline of the airlines with complaints about "flying Greyhound". Before that, Gorman was at Krispy Kreme, the much-liked, cholesterol-rich purveyor of doughnuts and other deep-fried delicacies. Both were troubled franchises, with Greyhound going through a service and image turnaround under Gorman and Krispy Kreme going through a financial crisis that forced it to slim down. But rest easy: Gorman, 52, started out at Northwest Airlines, where he worked with Delta’s new chief executive, Richard Anderson. Gorman has also been non-executive board chairman of Pinnacle, the big regional that serves as a major Northwest Airlink feeder.

Maybe it’s the full moon or maybe it’s the way weirdness accumulates around the holidays, but we got plenty of weird stuff here. For instance, we got surveys. One survey seems to have
stumbled on a nugget of truth, possibly profound truth: relatives may be family, but that doesn’t mean you like them. (This is a play on the line by the poet Robert Frost: “home is where they have to take you in when you go there”). In this case, on-line travel agency hotels.com found that a stunning majority (87%) of people would like it if their relatives would stay at hotel when they come to visit for the holidays. The survey found a pecking order of sofa guests, starting with distant relatives and cousins, whom many wanted to trek to the Holiday Inn, rising to grandparents. Only 23 % of the people surveyed didn’t want gramma and grandpa on the fold-out bed in the spare room. Another survey found that business travellers would miss their toothbrushes the most if their bags didn’t make their flight; this was followed by deodorant, lip-gloss and other personal care items. Interestingly, the Orbitz for Business survey also found that almost one-fourth of business travellers have had to share a room with a colleague when travelling for business. Cause and effect?

Monarch Airlines is in the doghouse for axing its popular Granada-London Gatwick route.
A group of more than 630 angry passengers has teamed together to petition Monarch to save the Granada to Gatwick flights.
Monarch proffers the explanation that “demand has not met expectations” for ending the route.
But Jo Chipchase, who has taken up the mantle on behalf of the aggrieved passengers, believes the flights can’t have just suffered from low passenger demand.

Ya gotta have some gumption to go to a foreign capital and spend your time there publicly criticising your host nation, but when the gumptionist is IATA’s Giovanni Bisignani, people will listen. Bisignani, known to most as simply GB or Giovanni, was in Washington, telling industry groups that President Bush’s “headline” moves to step in and cut red tape to aid holiday flyers was “a political placebo for a serious long-term illness.” The chief executive and director general of the world association, Bisignani told an industry group that Congress shared the Bush blame because “Short-sighted politicians, particularly the Congress, did not give the FAA the means to improve air-traffic management.” In New York, “neglect has left one of the biggest international gateways to the USA with an airport and air-traffic management infrastructure that cannot cope and where the slow pace of improvement is an embarrassment,” he told the Aero Club of Washington.

Everyone talks about mergers and consolidation but no one is doing anything about it. Well, Gerard Arpey at AMR has taken the first step, and it isn’t a merger. Arpey announced that AMR, parent of American Airlines, would divest itself of American Eagle, either through a sale or a spin-off to AMR shareholders. Arpey and AMR’s chief financial officer, Tom Horton, had discussed possibly spinning off the Eagle unit or another AMR unit such as its AAdvantage frequent-flyer plan, during the airline’s third-quarter analyst call. Spin-offs and divestitures have been a hot subject for months, and American was one of the first to come into the rumour mill after an Icelandic investor, FL Group, in September urged it to spin-off AAdvantage to “boost shareholder value.” The company said that it had thought about the Eagle transaction for some time, but had not yet decided how to do the deal.

Qatar Airways has become the only airline to fly from the Middle East to Stockholm. In fact it’s the only airline to fly from the Middle East to the entire Scandinavian region.
Flight QR091 arrived at Stockholm Arlanda International airport yesterday to, what the press release describes as “a red carpet ceremony and Swedish entertainment”. What constitutes Swedish entertainment?, you ask. Apparently a girl dressed as Pippi Longstocking presenting an Arabic translation of the Pippi Longstocking novel to Qatar’s chief executive Akbar Al Baker (see picture below).

JetBlue is only seven years old, but that apparently is old enough to give up some of its traditions. Founded with the intent of selling through the Internet predominantly if not exclusively, the airline last year broke one of its long-standing rules and began listing fares and availability through the GDSs (Global Distribution Systems). This was a break with the low-cost airline gospel, but now JetBlue has taken another step that makes it much more like a regular airline: it has signed up with most of the big on-line travel agencies. JetBlue had resisted this step for a long time; after all, the GDS move made sense if it was to attract higher-paying corporate business that has always relied on the GDS. But the on-line agencies tend to sell the cheaper inventory, and JetBlue will make even less on these cheap seats if it sells through someone else. But the airline believes that its new deals with Priceline, with Travelocity and with Orbitz, were worth it.

This just in: even though it’s only a few months old, Virgin America has been looking for a new chief executive since it started up. Not that there’s anything wrong with Fred Reid, the former Delta and Lufthansa executive who has served as its chief executive from Day One. But Reid has had to plan on leaving since the airline started flights because Transportation Department regulators insisted on his departure as a condition of granting VAm its operating rights. Reid, a California native, was too close to Richard Branson and VAm’s British investors at Virgin Atlantic, the regulators ruled. Now, the airline has found Reid’s successor, a genuine American from Shreveport, Louisiana.

After all that noise about how bad air travel could and probably would be over the five-day Thanksgiving Holiday, and after the White House stepped in and ordered the airlines to fly right, even the heavens cooperated. With a few exceptions, air travel over the major US holiday went about as smoothly as could be expected. Some 2.5 million people a day flew on the peak days, and between November 16 and November 27, some 27 million people were scheduled to fly. The worst we've heard is that United served a Thanksgiving turkey dinner to some of its O'Hare workers, a number of whom promptly suffered nausea. We think this was after they ate. Even trouble-prone US Airways had a good holiday. We’ve only heard a few kvetches, although a common complaint has been that otherwise navigable airports had been blocked by television camera crews and reporters looking for stranded and inconvenienced passengers. We’ve heard that George Bush is seriously considering a ban on journalists for Christmas, but we don’t know if it will only be at airports or will extend to ink-stained wretches everywhere.

They call the United States Senate the senate because it is the senior body (‘senex’ was a Roman elder). We note this on the birthday of the longest serving member of the United States Senate, West Virginia’s Robert Byrd. He turned 90 the other day, and we note this milestone not just because it’s a good age and one we wish for all our readers but because without this gentleman, we would not have deregulated the airlines of the United States. Back in the late 1970s, when Congress was considering the economic deregulation of the commercial industry in this country, proponents of liberalisation ran into a block they could not overcome: conservative Democrats and rural and farm state legislators (who are often the same the folks). They feared that the carriers would abandon places like Bismarck, North Dakota, or Macon, Georgia, if they had the freedom to concentrate on places like Chicago and Atlanta.

Who said the legacy carriers are not concerned about the new all-premium carriers?

British Airways and Virgin Atlantic keep claiming the launch of three all-premium carriers on the lucrative London-New York route have had little to no impact. But American Airlines, which at the end of last month launched a New York JFK-Stansted service, seems to be taking it more seriously.

I'm sitting now in the makeshift American lounge at Stansted Airport, which two of the three all-premium carriers, Maxjet and Eos, serve from New York.

Even nostalgia is breaking down. Visitors to LAX, the Los Angeles International Airport , have developed a habit of looking back fondly at the 1960s and in particular the airport’s truly 1960s space-age, everything-is-modern-style restaurant, the Encounter. The Encounter is located in the midst of the slightly bizarre lunar-landing structure that is a landmark of LAX. This ‘Galaxy Quest’ structure, dubbed the Theme Building, is a 1961 structure to which the Los Angeles city fathers and mothers gave landmark status in 1992. The restaurant itself is a blend of Star Trek-kitsch and George Jetson cartoonish excess. Its interior has kept that look and a quick visit to its website will show you as much. (If you do click on the link to go there, be prepared for some very loud, very bad 1960s-style music.) But even nostalgia shows its age, and the restaurant was closed between March and the middle of November after a 1,000-pound chunk of stucco came tumbling down from one of the arches. After a lot of repairs, Encounter’s reopening is still only partial and the Theme Building is still engulfed in a $10-million repair project. Some of the eatery's views will be obstructed by scaffolding that will be in place until the fall of 2008.

He cares. He really does. George W. Bush cares about your flights. The president, beset with plummeting approval ratings and an obstreperous Congress, has taken a step to get involved in the nation’s sprawling air-traffic control mess. As the nation’s busiest travel season looms with the Thanksgiving holiday, W announced that he had ordered the Defense Department to open restricted airspace (like this area near Norfolk, VA) between Maine and Florida to commercial airline flights during the five-day holiday next week, when 27 million are expected to fly to and from family feasts, almost always on excessive amounts of turkey. He also took to the stage with Transport Secretary Mary Peters to announce other steps in an unusually high-profile White House press conference, including a promise to speed up new rules that would give involuntarily ‘bumped’ flyers more compensation, raise the pay-out rules for lost luggage and make airline on-time reports more accurate.

It doesn’t take much to get the markets and the media chattering. All it really takes is a pesky hedge fund. One fund that one of these private investment funds, Pardus Capital Management, owns some Delta shares, and the other day Pardus made public a letter urging Delta to ‘take a lead’ role in airline consolidation and go out and look for a merger partner. Delta said it thanked Pardus for its interest, and that it in fact had already set up a committee to look at merger ideas. The markets and the media go crazy, shares spike and radio stations start calling around. Then one media outlet, the all-important Associated Press, the US version of the Press Association, comes out with a story swearing up and down that Delta had taken a lead role and was chatting away with United about a combination. The markets go even wilder, much like a dog digging for an old bone but finding a fresh rabbit. Within hours, Delta’s Richard Anderson, a man who tolerates little nonsense and buries no bones, comes out and has to deny that Delta is having any kinds of talks with United. None. Nada. The markets still jump up like that dog. Even after it’s revealed that Pardus owns United shares as well as Delta shares and so may be a winner no matter what - merger or no, so long as the shares go up.

Luckily I'm just out of range in terms of age for this novel (or horrifying depending on your point of view) speed-date outing that SkyEurope is pioneering. I'll let you guess which end of the age range (25-42) I am.

The headline of the release reads: Speed Dating on board of a SkyEurope 737 from London to Prague.

The release is self-explanatory:

"On 28 November 2007, SkyEurope Airlines will organise a speeddating event for singles between 25 and 42 on a flight from London Luton to Prague. This UK SkyDate is one of the speed dating events that are organised from different European countries (the Netherlands, Belgium, Italy, Spain, Portugal and UK)."

Ryanair's trademark "in your face" advertising has often been brash, controversial and rule-bending.

For some, seeing adverts that say that airports like Beauvais, Hahn and Skavsta are in Paris, Frankfurt and Stockholm respectively is stretching the point just a tad far.

But Ryanair appears to have outbent even itself with this advert snapped by Adrian Wynne-Morgan at Farranfore Airport in County Kerry, Ireland this summer.

"Frankfurt appears to have been ceded to France! ..and low-budget now encompasses maps," said Adrian.

A regional fascination: Americans make no attempt to restrain their fascination with the Middle East, perhaps because their interest is piqued every time the price of petrol goes up at the gas-station pump. It’s a region that many Yanks believe is marked by out-sized appetites and out-sized spending. The region’s airlines do little to dispel this, and news that a Saudi prince, Alwaleed bin Talal, had become the first customer for the executive version of the Airbus A380, the Flying Palace, grabbed attention. The prince, who is major and active shareholder in North American banks and hotels, will spend about $325 million on the plane - and that doesn’t include the none-too-shabby furnishings he’ll doubtless install. Some Airbus interior suggestions are at left.

“Okay, folksies, let’s quiet down. This is serious,” Mr. Faraday used to say to us in school. And so let’s get serious for moment: this 11th of November is a day to note. Even though many Americans think of this as just a day off from school or a great day for sales at the department store, it marks a serious occasion: the end of the War to End All Wars, World War I. In Anglo-American culture, it becomes a day to honour the veterans who fell in that and other wars and who continue to serve us. Even when a war or ‘military action’ is unpopular, it is important to remember this history. It is also moving, as would be attested to by pretty much everyone who has seen the Remembrance Day ceremonies and their poppy theme. In Canada, a nation that suffered grievously disproportional losses in that 1914-1918 slaughter, the national airline has stood up and gone out of its way to remember, and we note their efforts here.

Usually airlines tell their airports all the news ahead of time, good and bad. Sometimes, though, they have an interesting way of surprising their ‘partners’ with news. Take, for instance, Memphis, the Tennessee city where Frontier Airlines set up a mini-hub some six months ago. The Denver-based airline was experimenting with off-hub flying, linking the city on the Mississippi with Las Vegas, Fort Lauderdale, and Orlando as well as Denver. It was warmly welcomed in Memphis, a Northwest hub where they love to lament a former resident, one Mr. E. Presley of the Graceland neighbourhood, almost as much as they love to hate Northwest. Then suddenly, Frontier said, well, things aren’t working out, what with fuel at almost $100 a barrel. It will end its Memphis routes (except the Denver service) in January. When contacted by the local paper, the Commercial Appeal, the airport vice chairman said it was news to him. Elvis, whose songs include 'Don't Leave Me Now', could not be reached for comment.

Bags are a big item for Willie Walsh, the genial chief of British Airways. They are after all major issue at BA’s biggest base, London Heathrow, where the authorities have limited departing passengers to one-carry on bag. This has (a) infuriated flyers, (b) frustrated airlines, and (c) led to a dramatic increase in checked bags. Of these (c) has presented itself as ideal opportunity for the airport and its airlines to (a) lose bags, (b) lose more bags, and (c) lose record numbers of bags. This in turn has made Willie the target of considerable wrath. He reflected on this the other day in a visit to Washington where he told the International Aviation Club that "some of you maybe have found Heathrow a challenge." But Walsh is confident that the authorities will soon lift that "senseless" restriction. He’s got a real sensitivity to bags, he said, recalling with a blush the time he tried to lift the morale of BA's beleaguered staff by urging them to embrace change and “lose the baggage of the past.” Whoops.

Lauren is the code name for the British Airways project that chief executive Willie Walsh says will be the airline’s first response to the first stage of US/EU opening skies, or semi-open skies. Using Boeing 757s, the BA project will link New York with secondary key European business destinations, Walsh said. But Walsh said that Lauren is only the project name and that “we haven’t decided yet on these every serious issues of branding, or naming.” It may be a product that flies under the BA name or, a name such as (fill in the blank) by BA. The flights will be targeted at US-originating, European bound flyers, the business flyers that BA wants. So why, we asked, was it called Lauren?

Inspector Clouseau, the bumbler of the Pink Panther films a few years back, would talk about ‘buemps’ in the road, much to the consternation off the audience. Now, airlines in the States are talking about bumping, much to the consternation of their passengers. Because airline bumping, also known as denied boarding, is on the rise. The chances of properly ticketed passenger getting bumped from a flight worsened in the third quarter compared to the same period last year, according to the Department of Transportation. So far this year, involuntarily denied boarding reached a rate of 1.21 per 10,000 passengers, the worst in 13 years.

The latest wrinkle on the low-fares model has been the trend toward ancillary charges, asking passengers to pay for a meal, for a pillow and so on. Some carriers such as Ryanair or Allegiant rely on these charges and indeed on sales of rental cars, hotel rooms, and other extra services as well. Some flyers call it 'nickel and diming'. At the legacy carriers, a few such as United and Northwest have experimented with asking people to pay extra for their choice of seats and so on. United's Economy Plus, a section of coach where then seats have a little more legroom, brings in fair amounts of revenues. Even though some flyers grumble about the charges, the old-fashioned airlines may end up being right.

It has taken a couple of years of tough talking, but easyJet has finally found a way to work with the Global Distribution Systems (GDSs) to sell its tickets.

The UK-based low-cost carrier has signed deals with Amadeus and Travelport, becoming the largest low-cost player outside the USA to go the GDS route.

In the past low-costers have kept away from the distribution costs GDSs impose, but in easyJet's case the rise of business travellers amongst its clientele (around 20%) meant it had to find a way to work with them sooner rather than later.

An interesting experiment in getting airliners turned around more quickly has fallen down. Dual-boarding bridges developed for United's low-fares operation at its Denver hub have disappointed the airline. Made by a Canadian firm called Dewbridge, the double-enders were part of United’s efforts to make its Ted operation a smoother one. With both forward and rear doors used for boarding and unloading, Ted’s planes could be turned a lot more quickly, boosting daily aircraft utilisation to the levels of low-cost leaders such as Southwest.

Down in Atlanta they’re flush with pride over what they’re doing on global warming. Georgia has faced a draught so severe that the governor and the state legislature had a special session in which they prayed for rain. At the capital city's Hartsfield/Jackson airport, a task force is busy looking for ways to save water, of which it uses over 900,000 gallons a day. One of the first steps they’ve taken is to end that charming old practice of a fire-truck water-cannon salute for every landing by a pilot who’s about to retire. The airport is also springing a leak team to make the rounds of the 4,800-acre facility and ensure that none if its water fountains or lavatories has a water-wasting leak; there’re checking sinks and commodes.

Hawaiian Airlines says experiments with its long-haul fares helped boost revenues enough to push its profits up. President and chief executive Mark Dunkerley told investors, “We would try things week to week and see how it worked, then make a judgment to see if we should continue the experiment.” The experiment that worked, he said, was to “sell inventory closer in to the date of travel, at higher fares. And we exceeded our expectations”. Rivals had offered “irrationally” low fares, lower than in summer of 2006, on routes between the mainland and the islands, he said.