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 The Tactical Traveler

joe JOE BRANCATELLI'S BUSINESS-TRAVEL BRIEFING
FOR JUNE 16 - JUNE 30, 2005
The Weekend Fare Wars Are Getting Nasty
Domestic fares have risen at least six times this year since Delta Air Lines introduced SimpliFares in January. Each of the fare increases has been within the $499 one-way cap Delta adopted and each of the hikes has been imposed over a weekend, when the Big Six can signal each other's intentions before the start of business on Monday. But that gentle procedure was ruptured last weekend when Northwest not only broke the $499 cap by raising walk-up fares $50 each way but also saddled lower-priced business fares with a two-day advance purchase instead of Delta's one-day rule. Neither Delta nor American Airlines matched the moves, so Northwest and its current allies in fare crime (United, Continental and US Airways) were forced to rescind the increases. But this isn't over. Expect ferocious battles over the walk-up cap and advance-purchase rules over the next few weekends, probably culminating with a major fare move over the three-day Fourth of July weekend. And the bottom line is what it always has been: Never buy tickets on the weekend. Why? If you buy at a higher price and a fare increase is rescinded, you won't get a refund.

American Sells Admirals Club Day Passes on the Web
American Airlines has been desperately looking for ways to generate new revenue without adding cost. For once, that search has yielded a business-travel benefit, too. American now sells one-day passes to its network of Admirals Clubs in 37 airports on AA.com. The electronic passes, which cost $50, can be reserved up to a year in advance. Another new benefit: AA's day pass is valid throughout the day at as many Admirals clubs in as many airports as you may visit. Other airlines, including American, sell traditional day passes, but they must be purchased on the spot and are only valid at one specific lounge. United Airlines is dumping the glitch-plagued automatic luggage-handling system at its Denver hub. The system, which United has defended for a decade despite its obvious flaws, is now too expensive for the bankrupt airline to maintain and repair.

The Dollar Is On the Move Against the Euro
Ministers of the fractured European Union began a summit in Brussels today (June 16) to pick up the political pieces after French and Dutch voters said no to the proposed European Constitution. The crisis has driven the euro down to about US$1.21, an eight-month low. Some observers think the euro will drop below US$1.20 by early next week, a level it hasn't reached since last summer. "The $1.20 mark is an important indicator," one currency trader told me this week. "If it falls below $1.20, investors will start selling euros and it will drop further in July." In other words, after more than three years of dramatic gains against the dollar--the euro has gone from about 85 cents in February, 2002, to a high of $1.35 earlier this year--the pendulum is swinging the other way. That is good news for U.S. travelers whose European trips have been crimped by the weak dollar.

The Luxury Lodging Shake-Up Is Under Way
It's been all quiet on the luxury front in the six months since the St. Regis Los Angeles closed to make way for a condominium project. But now some important changes are in the works. The Pierre hotel in New York, which has been managed for years by Four Seasons, will soon change hands. The new management: Taj, the Indian hotel company that has been on the prowl for luxury properties in major cities around the world. Also in New York, the Rihga Royal has been sold to the Blackstone Group (more on them later). The property, originally opened by the Rihga hotel chain of Japan and most recently managed as a JW Marriott, will lose the Marriott affiliation soon. In Chicago, the Ritz-Carlton is for sale. Despite the name, the property is actually managed (and half-owned) by Four Seasons. It is unclear whether Four Seasons will continue to operate the hotel after the sale. In Honolulu, the Kalaha, which was once a Hilton and is currently a Mandarin Oriental, is being sold. The new owners are expected to turn the property over to Fairmont to manage. Finally, back to the Blackstone Group, an investment company that already owns several extended-stay chains and recently sold the Savoy Group in London. This week it said it would purchase the Wyndham chain for $1.4 billion.

Business-Travel News You Need to Know
Continental Airlines is doubling the number of first-class seats on its fleet of Boeing 757-300 aircraft. The 300-series planes currently have just 12 seats in first; Continental's older Boeing 757-200s already have 24 seats in first class. ... Delta Air Lines has raised the transatlantic fuel surcharge to $10 each way. Ford says it is going to spin off Hertz. The struggling automaker hopes to generate about $100 million with an initial public offering for the rental-car firm. T-Mobile says it has signed new roaming agreements for its HotSpot Wi-Fi network that expands the service's presence in hotels and airports. T-Mobile says travelers looking for wireless Internet access can now find HotSpot service at 72 airports; 10,000 rooms at more than 500 hotels; and more than 25,000 locations in 17 countries. Pan Am, the name that refuses to die, will be back in the skies next week. The New Hampshire-based owners of the Pan Am name, who also own Boston-Maine Airways, are launching new service to several secondary destinations in the Northeast, Florida and the Caribbean.

Want a Million Bonus Points? Easy. Just Build the Hotel.
Submitted for your approval (because, frankly, I have no idea what to make of it): Hilton says anyone who invests upwards of $10 million in a new hotel will earn one million Hilton HHonors points. Invest more than $10 million to build a new Hilton, Hampton, Embassy Suites, Hilton Garden Inn, Doubletree, Conrad or Homewood Suites and you'll earn two million points.

Copyright 1993-2005 by Joe Brancatelli. All rights reserved.