The Tactical Traveler
A BUSINESS-TRAVEL BRIEFING
FOR JANUARY 13 TO JANUARY 27, 2005
BY JOE BRANCATELLI
This week: Southwest "expands" with an ATA code-share, but dilutes its product and consistency; US Airways hires in Philadelphia to fix the luggage mess; Swiss International goes all-business-class on its Newark-Zurich route; Delta cuts flight attendants on some widebody flights; American eliminates in-flight food on some flights; several famous hotels are closing; and much more.
COUNTER INTELLIGENCE: Southwest 'Expands,' Loses Cohesion and Consistency
It's been one of Southwest Airlines' virtues: You may not always have been thrilled with its brand of air service, but you always got a consistent, cohesive product from one end of the system to the other. It was always the same planes, the same service, the same simple pricing, the same people with the same training and the same flight rules and procedures. No more. Effective February 4, when it begins code-sharing with bankrupt ATA Airlines, Southwest will extend its reach to many new cities. But Southwest will lose its cohesiveness since almost all the new flights will be operated by ATA. So your shock won't end once you see the Southwest code on flights headed to once-verboten places like Boston, Honolulu, Minneapolis, Washington/National, Newark and New York/LaGuardia and see the Southwest name return to cities like Denver and San Francisco. You'll also be shocked to find that the Southwest flight you're flying isn't really Southwest Airlines at all. Southwest's eventual plans for ATA are unknown--Southwest now has a huge stake in the carrier and is putting its own executives in key positions--but even the code-sharing marks a dramatic departure in strategy and tactics for the 800-pound gorilla of rational-fare airlines.
ANNALS OF BANKRUPTCY I: US Airways Admits the Obvious in Philadelphia
US Airways admitted this week that it would hire about 200 people in Philadelphia to work on the carrier's longtime luggage problems at the airport. It's also a de facto admission of what I've been telling you since the Christmas meltdown at PHL: Despite the airline's claims and mindless repetition by the general media, the mass of lost and misdirected luggage was not due to an employee sickout, but a result of understaffing and mismanagement at the airport. ... Meanwhile, B. Ben Baldanza, the airline's marketing chief, has left to become president of Spirit Airlines. Baldanza's ill-conceived package of rules and fees in August, 2002, led to a passenger revolt. ... Finally, your tax dollars are coming to the aid of US Airways again. The federal agency that granted US Airways almost a billion dollars of loans as part of the post-9/11 bailout has once again juggled terms so that the carrier is in technical compliance with the rules. US Airways still owes about $700 million on the loan.
ANNALS OF BANKRUPTCY II: The Endless Management Games at United
The bankruptcy court's rejection of a deal between United Airlines and its pilots last week was partially because of a typically slimy caveat: In exchange for a bribe to look the other way as the airline tried to shed its pension obligations, the pilots agreed to support the "exclusivity" of the airline's existing management led by Glenn Tilton. Tilton and crew have had the exclusive right to present a reorganization plan during the airline's entire stay of more than two years in bankruptcy, but there are indications that the bankruptcy judge is losing patience. ... Meanwhile, recently deposed Continental Airlines chief executive Gordon Bethune has contacted several groups interested in controlling the airline and let it be known that he'd be happy to run the nation's second-largest carrier if and when Tilton and the current bankruptcy boys are overthrown.
IN THE LOBBY: Famous Hotels Close or Change Names
The troubled U.S. Grant Hotel in downtown San Diego will close on January 31. The hotel will reopen after a $26 million renovation as part of the Starwood Luxury Collection. ... The 515-room Adam's Mark hotel in Philadelphia has been sold to the Target department-store chain and will close on January 30. ... The amazing shrinking hotel chain, Wyndham, has sold another 25 properties. Fifteen of them have been operating as Wyndhams and may continue to be Wyndham hotels if a franchise agreement can be struck. ... The Kapalua Bay Hotel on Maui, currently operated by Marriott, will close next year. ... Hyatt has purchased the mid-market AmeriSuites brand. The 143 properties will eventually be integrated into the Hyatt Gold Passport program. ... Fairmont will manage the 619-room Monte Carlo Grand hotel in Monaco and the property will be reflagged the Fairmont Monte Carol in March. The building has been purchased by a joint venture of Fairmont, the Royal Bank of Scotland and Saudi billionaire Prince Al-Walid bin Talal. The joint venture says it will soon purchase an interest in more European properties. The prince already owns the George V in Paris, the Plaza in New York and about 25 percent of the Four Seasons chain.
INTERNATIONAL ITINERARY: It's All Business at Swiss International
Swiss International Air Lines, the troubled successor carrier to Swissair, is about to the roll the dice on anall-business-class service at Newark Airport. Beginning Sunday, the airline's daily Newark-Zurich flights will use Boeing 737s configured with just 56 lie-flat seats. The flights will actually be operated for Swiss by PrivatAir, the same company that operates Lufthansa's all-business-class flights. Why slash the number of seats, dump first and coach classes and go all-business when the airline's existing Airbus A330 flights between Newark and Zurich had been operating about 80 percent full? Simple, says Steve Diggelman, Swiss International's North American general manager. "We're a different airline now. We're a lot smaller and don't have as many onward flights at Zurich as we once had. A lot of that Newark-Zurich traffic was actually [connecting in Zurich] and those connecting flights are no longer available," he explains. "This new service allows us to pamper our loyal customer base to Zurich. We've designed a product and an in-flight service that concentrates on their needs." The Newark move does not affect Swiss International's New York/Kennedy-Zurich flights, which continue to offer a more traditional mix of in-flight classes.
ON THE FLY: Business-Travel News You Need to Know
Delta Air Lines is cutting a flight attendant from the in-flight crews of its Boeing 767ER and Boeing 777 aircraft. The cut will be from the coach-cabin crew. The cuts take place January 31. ... American Airlines is eliminating free in-flight meals on 360 daily flights beginning February 1. Also gone: special dietary meals on transcontinental flights. ... Turkey has eliminated six--count 'em, six--zeros from its currency, the lira. The 1-million lira note, worth about 74 U.S. cents, is now a 1 lira note. New currency is being issued but both the new and old notes will be legal tender at least through the end of the year. ... There's been a modest rally of the dollar against the euro and the British pound this month. As of late Thursday, one euro was worth $1.32, down from the record of almost $1.37 on December 30. The pound now commands $1.88, down from a record of $1.95 at the end of 2004.
This column originally appeared at joesentme.com.
Copyright © 1993-2005 by Joe Brancatelli. All rights reserved.