The Tactical Traveler By Joe Brancatelli
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Business-Travel Briefing for June 7-June 18, 2015
The briefing in brief: Lufthansa puts a pricing gun to our heads and threatens to shoot itself. More changes in the high stakes (credit) card game. Pittsburgh has a hotel boom. Gogo raises monthly subscription prices 25 percent. Southwest Airlines pulls back in Akron. And more ...
Lufthansa Puts a Pricing Gun to Our Heads--and Threatens to Shoot Itself
Financially stressed Lufthansa infuriated the easy-to-infuriate travel industry this week by claiming it would impose a 16-euro (around US$18) fee for any booking made by travel agents and Web sites not aligned with Lufthansa and its Austrian, Belgian and Swiss subsidiaries. The so-called DCC (distribution cost charge) is scheduled for September 1. What's it mean for us? Basically, an $18 fee if you book anywhere but the four carriers' own sites or United.com or AirCanada.com, Lufthansa's transatlantic partners. (Lufthansa claims you also can avoid the charge if you book at the airport or via telephone, but those channels already incur Lufthansa's $20 "ticket service fee.") Needless to say, a book-on-our-site-or-else fee would be an horrific precedent--if it actually goes into effect. I don't think it will. For a variety of reasons--notably, existing contracts with the major reservations systems--most other carriers can't match the new Lufthansa charge for at least a year. And since about 80 percent of the Lufthansa Group's tickets are written by third-party sites, Lufthansa risks being the higher-priced player on virtually all of its seats. That'd be suicide, so watch this space in the weeks ahead for more details.
Following the High-Stakes (Credit) Card Game
Since earning airline miles and hotel points by booking flights and staying in hotels is so 1985, we must pay attention to the minutia of the credit card world. That's where the action is in 2015.
Hyatt Visa, the Chase card tied to Hyatt Gold Passport, is substantially upping benefits for new applicants. The first year's annual fee ($75) is waived--and there's a $50 statement credit after the first purchase. If you spend $1,000 in the first three months, you'll receive two free nights at any Hyatt property. That represents a value of as much as $1,200 based on current nightly rates. You'll even receive 5,000 Gold Passport points if you add an authorized user to the card. Use this link to apply.
American Express has improved the perks of its Premier Rewards Gold Card. The card no longer charges foreign transaction fees and now offers a $100 annual statement credit for spending on an airline of your choice. It has also upgraded the Membership Rewards earning structure. You'll receive two points at U.S. restaurants as well as the existing three points on airfares purchased directly from airlines and two points at US gasoline stations and supermarkets. The $195 annual fee is waived in the first year.
Starwood Preferred Guest American Express cards get new benefits starting in August. The card is eliminating the annoying foreign transaction fee. Cardholders will also receive free Boingo WiFi access and free higher-speed in-room Internet access. But the new perks won't come free. The annual fee rises to $95 a year from $65. Complete details are here.
Delta Hopes Early Valet Passes The Audition
After months of low-level tests in individual markets, Delta Air Lines this week began officially testing Early Valet at seven hub airports. What's Early Valet? On mostly leisure routes, where they think vacation flyers are too stupid to load their own carry-on bags, Delta employees will take the bags and pre-load them. The idea? Reduce boarding times and keep flights on-time. If it works, expect to see the plan expand. If it works well, assume Delta will try to charge for the privilege of keeping their flights on-time.
The Centurion Lounge, the growing network of airport clubs for Amex cardholders, has opened in Miami. It's located on the fourth floor of Miami's North Terminal near gate D-12. Sound vaguely familiar? That's where the British Airways lounge was located until 2007. As usual for Centurion Lounges, there is an elaborate food and beverage menu and markedly upscale furnishings. Access is free for black and platinum cardholders and $50 for other Amex members.
SuperShuttle, the shared-ride van service, is now operating at Salt Lake City.
Los Angeles still lacks a real first-class airport hotel, but at least it has a new option: a 231-room Residence Inn. It's located at 5933 W. Century Boulevard near Airport Boulevard.
Southwest Shifts From Akron, JetBlue Adds in Florida
Akron native LeBron James returned to Cleveland in his quest to bring a championship to Ohio, but the state continues to hemorrhage airline service. Southwest Airlines is the latest carrier downsizing in the nation's most populous state without an airline hub. Its latest schedule shuffle axes four routes from Akron/Canton, which AirTran once used as a focus city. Effective November 1, Akron loses flights to Boston, New York/LaGuardia, Denver and Washington/Reagan. An Akron-Las Vegas route does launch November 15, however. And Southwest is adding a Denver-Cleveland run on November 1.
JetBlue Airways continues to pour flights into its Florida focus cities of Fort Lauderdale and Orlando. Effective November 12, it'll add a daily flight into Orlando from Baltimore/Washington. A week later, it'll add a daily run between Philadelphia and Fort Lauderdale. Both routes will use Airbus A320s.
Hawaiian Airlines is dropping Sendai, Japan, from its route map. Its three weekly Boeing 767-300ER flights will now operate only on the Honolulu-Sapporo route.
Here Comes the (Hotel) Boom--in Pittsburgh, No Less
Developers are on a tear, building hotels everywhere the eye can see. But you wouldn't think that Pittsburgh, the steel town turned medical and education center, would necessarily be part of the building boom. You'd be wrong. The city and its surrounding suburbs have nearly six dozen lodging products in the pipeline this year. That'll add more than 6,000 rooms to Pittsburgh's inventory, a 24 percent increase, say the stat geeks. The latest opening: a 128-room Hyatt House in Pittsburgh's West End. Hyatt also added a Hyatt Place last month adjacent to the Meadows Casino in the Pittsburgh suburb of Washington.
Marriott opened a 226-room AC Hotel at the corner of Rush and Ontario, a block off North Michigan Avenue in Chicago. It's a top-to-bottom conversion of a former Four Points hotel.
DoubleTree by Hilton, which will convert your garage into a hotel if you let them, continues to grow by slapping fresh paint on old properties and giving you a bag of cookies. The latest: a 194-room former Holiday Inn in northwest Austin; the 179-room former Executive Suites in Omaha, and the 182-room former Yarrow Resort in Park City, Utah.
Business-Travel News You Need to Know
Gogo, now renowned for poor-to-crappy WiFi on thousands of aircraft, has another specialty: raising prices to use the poor-to-crappy service. On July 1, monthly subscription prices increase to $59.95 a month, a 25 percent hike. Gogo's justification: We own you if you believe you can't go a couple of hours without access.
7-11 has opened its first branch at a U.S. airport. It's in the Tom Bradley Terminal at Los Angeles Airport. Thank you, come again.
A Southwest Airlines fare sale this week crashed the carrier's Web site. Meanwhile, early-morning flights at United Airlines were briefly grounded on Tuesday morning (June 2) due to unspecified "automation issues." United promises to be automated any day now ...
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