THE BRIEFING FOR MAY 10 - MAY 24, 2007
By Joe Brancatelli
· JetBlue Boardroom Putsch: CEO, Know Thyself
· Marriott Ups the Price for Unrestricted Awards
· Everything's Up-to-Date at Kansas City Airport
· Northwest's CEO Picks Flight Attendant Pockets
· Go West, Young Airline. MaxJet Heads to LAX.
· Oops! American Did It (Strand Flyers) Again!
· Air Koryo Does Not Give Frequent Flyer Miles
The JetBlue Putsch: CEO, Know Thyself (and Thy Board )
The board of directors of JetBlue Airways forced founder and chief executive David Neeleman into the role of non-executive chairman today (May 10) and you have to wonder why it took so long and why Neeleman needed to be pushed to give up daily control. A notoriously erratic day-to-day manager, Neeleman is an entrepreneur at heart and is best at strategies, not tactics. He should have given up the CEO role years ago as the 7-year-old carrier grew into a complicated organization with almost 600 daily flights. The breaking point: The Valentine's Day massacre, when a harsh winter storm at JetBlue's Kennedy Airport hub left hundreds of passengers stuck on planes for hours and then essentially grounded the carrier for several more days. The guy chosen to replace Neeleman as chief executive, president Dave Barger, was in Florida on Valentine's Day. When he heard about the storm, he contacted JetBlue's war room and reminded managers not to strand passengers on aircraft, as American Airlines had done in Texas just six weeks earlier. But then Neelemen took control of the JetBlue response and Barger's warnings were disregarded. A well-respected operations executive who fixed Continental's Newark hub before moving to JetBlue in its planning stages, Barger was preparing to leave the company if he didn't get the top job.
Marriott Doubles the Premium for Unrestricted Awards
Marriott Rewards has doubled the premium required for its unrestricted hotel stays. Effective June 1, the program's so-called Stay Anytime awards will cost twice as much as its standard, capacity-controlled rewards. Some examples: The cheapest one-night Marriott Reward, for a Category 1 hotel, costs 7,500 points. The Stay Anytime Reward is currently 11,250 points, but will rise to 15,000 points beginning June 1. At the other end of the scale, a standard reward for a Category 7 hotel costs 35,000 points. A one-night Stay Anytime award is currently 52,500 points, but will rise to 70,000 points on June 1. Speaking of Marriott Rewards, Virgin Atlantic has joined the program. Marriott members will be able to earn Virgin Atlantic Flying Club miles or convert Marriott points to Flying Club miles. Hilton HHonors members take note: Hilton has been overhauling the HHonors Web site all week and it has been a painful and confusing transition. Not all functions are working and not all information about your account is available. The Leading Hotels of the World has joined Delta SkyMiles. Guests at Leading Hotels receive 2,000 miles per stay until July 15. After the introductory period, guests receive 1,000 miles per stay when reservations are booked through a special site.
Car Rental's Up-to-Date in Kansas City
A 135,000-square-foot consolidated car-rental facility opened last week at Kansas City International airport. The $90 million building replaces the individual operations of all 10 on-airport car-rental firms. A common car-rental shuttle has replaced the proprietary shuttles operated by each firm. At Denver International, United Express flights have been consolidated at a 16-gate facility at the east end of Concourse B. That means all United and United Express flights at Denver now use Concourse B. US Helicopter, which operates helicopter flights from midtown Manhattan to New York/Kennedy airport, is moving its JFK terminal. Effective Monday (May 14), the service will operate from Terminal 3, Gate 11, as part of Delta's JFK hub. US Helicopter has been using Terminals 8/9, the American Airlines hub.
How Northwest's CEO Picks His Flight Attendants' Pockets
A battle between bankrupt Northwest Airlines and its flight attendants ended last year when Northwest imposed $195 million worth of concessions on them. Northwest then used its bankruptcy shield and the federal courts to block a strike by the unhappy flight attendants, who had rejected two earlier concessions-laden contracts and had their existing negotiated contract unilaterally ripped up by Northwest management. This probably shouldn't surprise you, but guess who's getting a huge chunk of the money that Northwest beat from its flight attendants' purses? Yup. Northwest chief executive Doug Steenland. As part of a 5 percent share grant that will be awarded to 400 top managers when Northwest exits bankruptcy later this year, Steenland will receive restricted stock and stock options worth $26.6 million. Do the math, fellow travelers. It means Steenland essentially gets almost one of every seven dollars that Northwest took back from its flight attendants. According to the carrier's April 30 proxy statement, Steenland earned the equivalent of $2.66 million last year. A 15-year Northwest flight attendant averages $35,433 a year.
Go West, Young Airline. MaxJet Expands to Los Angeles.
MaxJet Airways, one of the three start-up all-business-class carriers flying to London, is adding another major nonstop route. Effective August 30, it will fly four times weekly between Los Angeles and London's Stansted Airport. Launched 18 months ago, MaxJet already flies to Stansted from New York/Kennedy, Washington/Dulles and Las Vegas. Austrian Airlines will launch six weekly nonstops between Chicago/O'Hare and Vienna on May 29. Aeromexico will begin flying from Seattle to Mexico City on July 5. The two-class Boeing 737 will offer continuing service to Guadalajara. Air Canada begins flying between Toronto and Fort Myers, Florida, on June 16. The year-round service will operate once a week. Copa Airlines is expanding at Washington/Dulles. On July 15, it will launch daily flights to Panama City and twice-weekly flights to Punta Cana, Dominican Republic.
Business-Travel News You Need to Know
A fusillade of fare-increase proposals last week mostly floundered. At the end of the jockeying, fares jumped $5-$10 in a few markets. United's plan for a $100 roundtrip increase on walk-up fares also largely died. A US$9 billion buyout offer for Qantas failed last weekend when not enough of the Australian airline's shareholders tendered their stakes. Oops! American Airlines did it again. After insisting that its meltdown in Austin last December--when hundreds of passengers were held on diverted planes for hours--would not happen again, it happened again. Two weeks ago, nearly 200 passengers sat for eight hours, stuck on an Boeing 757, after their flight was diverted from Dallas/Fort Worth to Midland, Texas. American's official excuse: The portable staircase in Midland didn't fit and it would have been unsafe to unload passengers.
And, No, Air Koryo Doesn't Give Frequent Flyer Miles
Business travelers have tales about just about any airline you can name. But I bet that almost none of us have a story about flying Air Koryo, the flag carrier of xenophobic North Korea. But a blogger named Paul Karl Lukacs was recently aboard an Air Koryo flight and has fascinating details about the experience. My initial thought after reading the blog: If I have to fly a 28-year-old Ilyushin 62-M, I want my miles
ABOUT JOE BRANCATELLI Joe Brancatelli is a publication consultant, which means that he helps media companies start, fix and reposition newspapers, magazines and Web sites. He's also the former executive editor of Frequent Flyer and has been a consultant to or columnist for more business-travel and leisure-travel publishing operations than he can remember. He started his career as a business journalist and created JoeSentMe in the dark days after 9/11 while he was stranded in a hotel room in San Francisco. He lives on the Hudson River in the tourist town of Cold Spring.
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This column is Copyright © 2007 by Joe Brancatelli. JoeSentMe.com is Copyright © 2007 by Joe Brancatelli. All rights reserved.