The Tactical Traveler
JOE BRANCATELLI'S BUSINESS-TRAVEL BRIEFING
FOR MARCH 17 TO MARCH 31, 2005
WATCH FOR RISING PRICES DESPITE THE FARE SALES
- Watch for Rising Fares Despite the Noteworthy Sales
- Southwest Builds Its Empire at Chicago/Midway
- US Airways Does a Max Bialystock
- Easier Web Surfing at the Airport
- How Do You Say Simple Fares?
- The Dollar Is Tanking in Europe--Again
- American Adds First-Class Seats on the MD-80s
We reached a landmark low in transcontinental fares this week--Independence Air has been selling $69 off-peak seats on its Washington/Dulles-California flights--but we've also seen an unprecedented battery of fare increases. For the second week in a row, the Big Six carriers, led by Northwest Airlines, raised prices by as much as $20 roundtrip. Southwest Airlines then raised fares from $1 to $3 one-way in almost all of its markets. And JetBlue Airways followed by raising prices $4-$5 each way on most of its routes. The fare increases came so quickly this week that Delta Air Lines' computers were overwhelmed and briefly breached the carrier's SimpliFares cap of $499 one-way. Delta promptly reinstated the $499 cap, but the point is clear: As the fare structures flatten out and oil prices continue to skyrocket, fares will be rising in the weeks and months to come.
SOUTHWEST BUILDS ITS EMPIRE AT CHICAGO/MIDWAY
Southwest Airlines is leaving little doubt that it will be a major player in Chicago and challenge the point-to-point hegemony of American and United airlines, which fly from O'Hare. Southwest already operates about 150 daily flights from Midway Airport and has purchased a controlling interest in Midway's other big player, bankrupt ATA Airlines. By the end of July, however, Southwest says it will operate 192 daily flights. New service to Norfolk and Salt Lake City began today (March 17). Coming next: flights to Portland, Oregon (April 3); Pittsburgh and San Jose (May 4); Austin and New Orleans (May 31); Buffalo (June 17); and Albany, Tucson and Sacramento (July 5).
US AIRWAYS TRIES THE MAX BIALYSTOCK APPROACH
You all know Max Bialystock, the sleazy producer from Mel Brooks' The Producers, right? He would sell endless shares of his schlocky new plays to old ladies to fund his lifestyle. It looks like bankrupt US Airways is taking a leaf from the Bialystock playbook. Last month the airline sold about 25 percent of itself to commuter carrier Air Wisconsin for $125 million and claimed it needed to obtain another $125 million to exit its second bankruptcy proceeding. On Monday, it raised $125 million more by selling another 25 percent of itself to still another commuter carrier, Republic Airways. But now US Airways says it still needs another $100 million to come out of bankruptcy.
Lufthansa is expected to announce a deal next week to take over ailing Swiss International, the troubled successor to Swissair
Creditors of Tower Air, which folded in 2000, are suing the airline's accountant, Ernst & Young. The creditors claim that the bean counters conspired with airline management to inflate profits and understate losses.
EASIER WI-FI SURFING AT THE AIRPORT
If you've been frustrated by the patchwork of competing Wi-Fi systems that operate at the nation's airports, life got just a little easier. Wayport and Cingular Wi-Fi subscribers can now roam on both networks thanks to an agreement between the two firms. Wayport controls networks at Dallas/Fort Worth, Oakland, San Jose and Austin. Cingular Wi-Fi subscribers can now also roam on the networks operated by Concourse Communications at major hubs such as New York/Kennedy, New York/LaGuardia, Newark, Minneapolis-St. Paul and Detroit/Metro
The former Four Points hotel at Buffalo Airport has changed flags and is now called the Millennium Hotel.
THE SAD STATE OF THE GREENBACK GETS WORSE
The U.S. dollar continues to take a pounding against the world's major currencies thanks to the rising price of oil and America's awful trade and budget deficits. Late Thursday, the euro was commanding more than $1.33 against the U.S. dollar and the British pound was hovering above $1.92. The dollar was down to around 104 Japanese yen and 1.15 Swiss francs.
Citibank credit-card holders take note: Beginning April 2, all Citibank credit cards, including the American AAdvantage card, will impose a 3 percent fee for foreign-currency transactions.
IN THE SUMMERTIME, MORE INTERNATIONAL FLIGHTS
The worldwide airline industry adopts what it euphemistically calls the "summer schedule" beginning the weekend of March 26. Most of the changes in the early weeks are in Europe, Asia and Africa. The major international route additions to and from the United States begin in May and June.
Spirit Airlines has delayed the launch of its Detroit-Cancun flights until April 8; the service was due to begin next week.
The Star Alliance has added TAP Portugal as its 16th member.
Lufthansa says that flights from half of its U.S. gateways will be equipped with Internet access by the end of March.
The two faces of India came face-to-face at Mumbai International Airport earlier this month when government officials razed more than 650 slum "hutments" that had grown up next to the airport's taxiway.
MORE SCREENERS ACCUSED OF LUGGAGE THEFT
Four security screeners at Honolulu Airport were placed on leave this week. The accusation: stealing money and other items from the suitcases of Japanese tourists.
Two Sikh militants were acquitted on Wednesday of involvement in the 1985 sabotage of an Air India flight from Canada. More than 300 people died when the plane exploded off the coast of Ireland en route to London. The defendants were also cleared of trying to bomb an Air India plane in Japan. That Japanese bomb exploded before it was loaded and killed two baggage handlers at Tokyo/Narita. The verdicts came after a 19-month trial in Vancouver and two decades of constant political jockeying in Canada. A third defendant, who Canadian authorities claimed made the bombs, pleaded guilty last month.
BUSINESS-TRAVEL NEWS YOU NEED TO KNOW
American Airlines, which has abandoned More Room in Coach and is stuffing chairs back into the back of the bus, is at least increasing the number of first-class seats, too. About two-thirds of American's fleet of more than 330 MD-80s will have two extra first-class seats by the end of April. The airline will remove a storage closet to make way for the additional first-class seats.
Song, the low-fare service of Delta Air Lines, has installed a second-generation in-flight entertainment system. It offers free live television broadcasts, more than 1,600 MP3s, a dozen video games and 10 pay-per-view movies. Unfortunately, early reports indicate that the second-generation system is as balky and unreliable as the initial units.
Say goodbye to the old Sheraton Bal Harbour. It will close next June and the building will be razed to make way for a St. Regis hotel.
A SIMPLE FARE BY ANY OTHER NAME
Thirteen years ago, when American Airlines briefly simplified fares, they called the system Value Pricing. When Delta Air Lines offered up some less-complex pricing in January, the airline dubbed it SimpliFares. The latest entry is from Scandinavian Airlines Sweden, which claimed this week that it was offering just three kinds of domestic fares: "fix," which is capacity controlled; "flex," a restricted, but changeable fare; and "full flex," a traditional fully refundable, walk-up price. The name of the program: Nya Inrikesflyget. I am assured by Swedes I trust that the Swedish language really doesn't get any simpler than that.
Copyright © 1993-2005 by Joe Brancatelli. All rights reserved.