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THE BRIEFING FOR JUNE 20 - JULY 4, 2013
By Joe Brancatelli
· United's Smisek Says Let Them Eat Split Cashews
· Feds Raise the Alarm on an American-US Air Deal
· Three New Hotels Open on One Block in Chicago
· Together Again: Marriott Rewards, AAdvantage
· Hertz Starts Renting 'Dream Cars' in 35 Markets
· Turkish Dropping Its Premium-Economy Class
· Krusty Burger and Lard Lad Donuts--for Real
United's Smisek Says Let Them Eat Split Cashews
If you're one of the few business travelers who still believes that the current management of United Airlines can revive the broken carrier, you might want to rethink your position after chief executive Jeff Smisek's disastrous interview on Monday (June 17) with The Wall Street Journal. He first was forced to admit that last year's computer transition was a fiscal and operational disaster. In fact, all of 2012 was "awful," he conceded, saying that management "changed too much too quickly." But when it came to the part of the interview where any rational CEO would announce the new benefits and products he would offer to win back his customers, Smisek only talked about more cuts. A notable one: United has trimmed $200,000 from its annual catering budget by switching to split cashews in premium-class nut ramekins. "Customers don't care if it's a whole nut or split in half," Smisek claimed. Maybe not, but flyers surely care about new cuts that United promptly announced after Smisek's interview. On Tuesday, it added spending requirements to MileagePlus elite-status qualification. The move apes Delta's move in January. (Details on United's new elite rules are here.) Then on Wednesday, MileagePlus hiked change and redeposit fees on award tickets to as much as $200. (Details are here.) The week ended with United finishing dead last again in the annual American Customer Satisfaction Index. United's score of 62 was worst among legacy carriers and trailed the best-rated airline (JetBlue Airways) by 21 points.
The Feds Raise the Alarm on an American-US Airways Merger
The nonpartisan Government Accountability Office this week raised major competitive concerns about the impact of a merger of American Airlines and US Airways. Its 31-page report says that an AA-US merger would reduce competition on 1,665 one-stop domestic routes. That's about 12 percent of the commercial air-travel system and 45 percent more than the 1,147 routes impacted by the 2010 merger of United and Continental airlines. The merger would also eliminate all competition on seven of the 12 nonstop routes where the two airlines currently overlap. The biggest area of concern: Washington/National, which US Airways now claims is a hub. US Airways chief executive Doug Parker, who's slated to run the combined airline, appeared before a Senate aviation subcommittee yesterday (June 19) and insisted that he saw no reason to give up take-off and landing positions at the slot-controlled airport. But a bipartisan array of senators was clearly worried by the 68 percent market share the new American would control at DCA. And Senator Jay Rockefeller (D-WV) was especially skeptical of Parker's claim that he needed all of the National slots to ensure continuing service to smaller cities. "Other airline CEOs repeatedly promised that merging their airlines would lead to more choices for travelers in small and rural communities," he noted. "I have found that not to be the case."
Three Hotels Open This Week on One Block in Chicago
The hot River North neighborhood in Chicago has another new attraction. Well, at least from the perspective of business travelers. A three-pack of hotels opened on the same street (North Clark) today (June 20) and the novelty is that three competing hotel companies are represented. From Hyatt, there is a 212-room Hyatt Place. From Starwood, there's a 270-room Aloft. And Marriott is represented by a 180-room Fairfield Inn. The management firm that pulled off the feat is White Lodging, which developed Marriott Place in Indianapolis, a collection of five Marriott hotels on a seven-acre parcel. ... Also new this week: the 451-room Hyatt Regency Gurgaon in New Delhi's capital region. ... Hilton debuted a 118-room Hilton Garden Inn in Victoria, Texas ... Another Aloft opened, too, this one a 177-room property in Cancun's Hotel Zone. ... And New York City got three more limited-service hotels this week: a 177-room Holiday Inn Express near the Manhattan Cruise Terminal; a 173-room SpringHill Suites just off Fifth Avenue on West 37th Street; and a 148-room Hampton Inn a few blocks from the United Nations.
Marriott Rewards and American AAdvantage Renew Partnership
Three years after they abruptly ended a long-term partnership, American AAdvantage and Marriott Rewards have once again decided to partner in each other's programs. You can earn AAdvantage miles for Marriott stays and Marriott Rewards points for flights on American. You can also convert Marriott Rewards points to AAdvantage miles. Complete details are here. ... JetBlue Airways says points in its TrueBlue program no longer expire. ... EVA Air of Taiwan joined the Star Alliance on Monday (June 17) and then became a partner of Air Canada's Aeroplan program. ... SkyMiles members waiting for the Delta-Virgin Atlantic partnership to commence got good news today (June 20). Two of the three major regulatory bodies that must approve the deal--the U.S. Justice Department and the European Community--have signed off on the deal. As soon as the U.S. Transportation Department gives its okay--it must rule by November 30--Delta can buy Singapore Airlines' 49 percent share of Virgin and Richard Branson's struggling carrier can create a code-share and SkyMiles deal with Delta.
Business-Travel News You Need to Know
Got T&E budget to burn? Lucky you. Hertz has rolled out its Dream Cars service in 35 major domestic markets. For obscene amounts of money, you can rent cars such as the Aston Martin Vantage, Bentleys, Ferraris or the Lamborghini Gallardo. Full details on the cars, the service and prices are here. ... Remember Kai Tak, Hong Kong's old airport on Kowloon? It reopened this week--as a cruise-ship port. The US$1 billion transformation includes a new terminal and the conversion of the former runway into ship berths. ... My Seat 2B column a few weeks back explained how premium-economy class was becoming a worldwide aviation standard. Shows you how much I know. Turkish Airlines confirmed this week that its excellent Comfort Class is being removed. Turkish only offers the cabin on long-haul Boeing 777-300ER aircraft and the lack of Comfort Class on other flights from the carrier's Istanbul hub apparently confused many customers. The huge cabin was also configured with 63 seats, around twice the number of premium-economy chairs per aircraft offered by other airlines.
Life Imitates Art--Okay, Life Imitates The Simpsons--in Orlando
This is too delicious. Perhaps not delicious in the food sense, but certainly insanely wonderful in the ironic sense. At the Universal Orlando theme park, which already has a number of Simpsons-related attractions, a real-life collection of restaurants referenced in the long-running show have now opened for business. There is Moe's, the seedy bar frequented by Homer and Barney; Krusty Burger, Springfield's fast-food chain fronted by Krusty the Clown; an outlet of The Frying Dutchman, the fish joint where Homer once got tossed for abusing the "all you can eat" policy; and even Luigi's, an Italian joint run by a character who looks suspiciously like the stereotyped, mustachioed chef from the pizza boxes. And, of course you can buy a box of Lard Lad donuts, too. Complete details and a wonderful array of pictures are here.
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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 © 2013 by Joe Brancatelli. JoeSentMe.com is Copyright © 2013 by Joe Brancatelli. All rights reserved.