A BRIEFING FOR APRIL 18-APRIL 30, 2008
By Joe Brancatelli
· The Only Way to Buy Tickets? Credit Cards
· Much Ado About a Very Minor Travel Problem
· You Can't Believe What You Read About Travel
· More Fare Hikes and Bad News About the Dollar
· US Airways Will Charge for 'Choice' Coach Seats
· United Cuts a Flight Attendant from B757 Flights
· No Deaths on U.S. Commercial Flights in 2007
The Only Way to Buy Tickets? Credit Cards. Period.
The surprise bankruptcy of Frontier Airlines last week was caused by a sudden demand for additional "holdbacks" from the carrier's credit card processor. And the bankruptcy should be a reminder that the only safe way to buy a plane ticket is to use your credit card. Put away your debit card. Forget PayPal. Ignore any other payment system an airline suggests you can use. It's credit cards. Period. Why? The Fair Credit Billing Act requires credit card companies to remove a charge if an airline tanks before you can use your ticket. But you don't have that protection if you use your debit card, a check, PayPal, cash or any other payment method. If your airline tanks and you haven't paid with a credit card, you go to the end of the unsecured creditors' line and you'll never see your money again. What's this got to do with Frontier? The airline's credit card processor, First Data, was obviously concerned that Frontier might stop flying, so it decided to hold back a greater share of Frontier's credit card receipts as a partial offset against potential cardholder claims. Frontier is asking its bankruptcy judge to stop First Data from increasing its holdbacks.
Very Much Ado About a Very Minor Travel Problem
About three in ten flights run late on an average day, lost-luggage rates are skyrocketing, airline service is deteriorating, the fare structure is a mess and everyone worries about the financial health and safe operation of the nation's carriers. So what does the Department of Transportation (DOT) tackle? Denied-boarding compensation, which affects just one in every 10,000 flyers. Effective next month, flyers who are involuntarily bumped will receive $400 if they do not reach their domestic destination within two hours of the original arrival time or their international destination within four hours of their original schedule. If the delay is longer, the payment is $800. If there is a silver lining in this otherwise irrelevant decision, here it is: The bumping rules now apply to flights with as few as 30 seats. (The old rules didn't apply unless you were booked on an aircraft with more than 60 seats.) That means virtually all commuter flights are now subject to the involuntary bumping rules. By the way, a reminder: These rules do not apply in voluntary-bump situations where you agree to give up your seat.
Why You Can't Believe What You Read About Travel
It's worthless to worry too much about what the mainstream media says about business travel. The reporters generally can't spend enough time backgrounding themselves and their editors usually won't let them write the business traveler's side of the story. But attention must be paid to the strange relationship between the Columbus Dispatch of Ohio and Columbus-based Skybus, which tanked earlier this month. Two days after Skybus abruptly stopped flying, one of the paper's business reporters, Marla Matzer Rose, sliced and diced the carrier, all with a tone of "we knew it was coming all along." But if Rose knew it all along, she sure didn't tell her readers. The paper posted a timeline of her Skybus stories from before its launch to the week before its collapse and you'd be hard-pressed to find a discouraging note in her reporting. But wait, it gets worse. According to a column posted last Sunday by Benjamin J. Marrison, the paper's editor, the Dispatch knew Skybus was going to fold. It even sent a reporter to cover the carrier's last departure from Columbus. But it never let the reporter tell the flight's passengers, thus guaranteeing that they'd all be stranded on arrival in Fort Lauderdale. And if all of this sounds weird even by mainstream media standards, here's the kicker: The parent company of the newspaper was one of Skybus' investors.
More Fare Hikes, Bad News About the Dollar and Airline Stupidity
First this week, the fare hikes: Lead by United Airlines, the Big Six carriers increased fuel surcharges by another $10-$20 roundtrip. And Southwest Airlines said that it would raise fares by $3-$10 one-way on flights operating between June 13 and August 17. … Now the bad news about the dollar: It reached a new low against the euro this week, falling to $1.595 on Thursday. And the dollar dropped below the 7-yuan mark this week against the Chinese currency for the first time in more than a decade. … And now airline stupidity: US Airways will charge $5-$30 per segment for a seat assignment in so-called "Choice Seats" in coach. It's similar to the lame program launched by Northwest Airlines two years ago. Elite members of the US Airways Dividend Miles program are exempt from the charge. … Meanwhile, the value of the Delta-Northwest merger, announced at $17.7 billion on Monday evening, has already declined by $600 million. The transaction will swap 1.25 shares of Delta stock for each share of Northwest--and Delta's share price has declined 17 percent since Monday.
Business-Travel News You Need to Know
As if service at United Airlines isn't uneven enough, the airline is cutting back to four flight attendants on its Boeing 757 flights. As recently as three years ago, United staffed a Boeing 757 with six flight attendants. Boeing 757s comprise about 20 percent of United's worldwide fleet. … For all of the emergency inspection groundings that we've suffered through in the last month, there is some good news: The Federal Aviation Administration this week said there were no deaths on U.S. scheduled flights in 2007. That includes traditional jet flights and commuter service covering about 19 million hours of flying. … Speaking of inspection groundings, Trans States Airlines cancelled just one flight today (April 18) after dumping more than 150 flights in the previous three days. All of the carrier's EMB-145s have been returned to service. … Maxjet, the all-business-class airline that collapsed last December, is flying again. But only as a charter carrier and in the hands of new owners. … British Airways this week fired the two top executives in charge of Terminal 5 at London/Heathrow Airport. T5 put passengers through more than a week of hell when it opened last month and BA insiders say the fiasco may have cost the airline more than $100 million in lost revenue and other costs.
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.
THE FINE PRINT All of the opinions and material in this column are the sole property and responsibility of Joe Brancatelli. This material may not be reproduced in any form without his express written permission.
This column is Copyright © 2008 by Joe Brancatelli. JoeSentMe.com is Copyright © 2008 by Joe Brancatelli. All rights reserved.