The Tactical Traveler By Joe Brancatelli
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Business-Travel Briefing for August 6-20, 2015
The briefing in brief: Gogo going nowhere as flyers flee high prices and bad service. British Airways will stay at JFK's Terminal 7 for seven more years. Western chains keep opening in China. LAN and TAM will operate as LATAM. United's critic of MileagePlus members departs. And more ...
Gogo Going Nowhere as Passengers Flee High Prices and Bad Service
Have you given up Gogo because its in-flight WiFi is agonizingly slow--when it works at all--and brutally expensive? You're not alone. According to figures the company released this week along with its dreary financial results, the passenger "uptake" rate in the first quarter of this year has tumbled to 5.9 percent from 6.5 percent last year. Imagine that, fellow travelers, there is a place where fewer people are using the Internet. And it's in the sky thanks to Gogo's impossibly bad product and impossibly high prices. Speaking of those prices, Gogo said its average revenue per session in first half of the year jumped about 15 percent to $12.23 from last year's $10.62. But no matter what Gogo's flacks and its fanboys claim, it is clear the higher prices are not offsetting the loss of customers. The company's losses in the first half of the year widened to $44.8 million compared to $35.5 million last year. And consider: Gogo has now wired 2,249 commercial aircraft and been trying to make passenger-paid Internet profitable since it launched in 2008.
British Airways Staying at JFK's Terminal 7 for Seven More Years
Once upon a time, United Airlines and British Airways were allies and code-share partners. They even agreed to share digs at Terminal 7 at Kennedy Airport in New York. The alliance ended when United created the Star Alliance with Lufthansa and BA lined up with American Airlines in the Oneworld Alliance. And with United announcing its departure from Kennedy in October, the future of JFK Terminal 7 seemed cloudy. BA cleared up some of the doubt this week and said it has extended its lease on the terminal for another seven years. Who will replace United in the building? Willie Walsh, the boss of IAG, BA's parent company, surprisingly did not rule out Aer Lingus, the Dublin-based carrier IAG is buying and the airline in a tight relationship with JetBlue Airways in Terminal 5. "That could be an easy solution for us," Walsh said. But he also quickly said "there are other airlines that have expressed an interest in taking up the gates." So stay tuned.
Toronto/Pearson has a new dining option. The Asian-fusion Lee Kitchen in Terminal 1 is from Susur Lee, the celebrity chef with three restaurants in Toronto and one in Singapore.
London/Heathrow has a new public lounge, Aspire, its first in Terminal 5, British Airways' home base. The club is available free to Priority Pass cardholders. Walk-in customers pay 40 pounds (about $55) for access.
LAN and TAM Will Finally Operate as One Brand
LAN of Chile and TAM of Brazil merged three years ago and adopted LATAM as its corporate name. Yet the carriers and their subsidiaries have continued to operate as separate airlines. That'll end sometime next year as all the operating carriers adopt the brand LATAM with new livery. That includes LAN carriers in Chile, Peru, Argentina, Colombia and Ecuador and the TAM carriers in Brazil and Paraguay.
American Airlines is adding flights in Latin America and the Caribbean this fall. It'll launch weekly flights from Charlotte to both Curacao and Port au Prince, Haiti; five weekly flights between Dallas/Fort Worth and Quito; a weekly flight between Chicago/O'Hare and Punta Cana, Dominican Republic, and twice-daily flights between Los Angeles and Mexico City. The Mexico City service begins September 3. The other flights start on December 19.
All Nippon Airways has bested Delta Air Lines for the right to bring Skymark Airlines out of the Japanese version of bankruptcy. Delta had hoped to align with Skymark because it does not have a Japanese alliance while American is tied to Japan Airlines and United is tied to ANA.
Western Chains Keep Opening Hotels Throughout China
We talked last week about the collapse of the India hotel market and specifically mentioned that China has remained a hotbed of lodging development. Here is this week's proof: The Starwood Luxury Collection has opened the 158-room Grand Mansion on Changjiang Road in Nanjing. Marriott has opened a 311-room property in Zhuzhou in Hunan province. And Hilton has opened a 270-room DoubleTree in the new central business district of Xiamen and a 314-room Hilton in the Science City development in Guangzhou.
Starwood has opened another Westin hotel in Austin, a 19-story property at the corner of San Jacinto Boulevard and Fifth Street. It has also added a new Four Points in the Dudullu industrial district of Istanbul.
Hyatt has opened a 126-room Hyatt Place hotel in Dubai's Nasser Square.
InterContinental has opened a 70-room Holiday Inn Express in Salem, Ohio.
Business-Travel News You Need to Know
The United Airlines executive who called elite MileagePlus members "overentitled," chief financial officer John Rainey, is leaving the company. He's been appointed CFO of PayPal. You might want to bring down the balance in your PayPal account ...
American Express says it will open a Centurion Lounge in Terminal D of Houston/Intercontinental. But don't rush there. It won't open until well into 2016.
Raleigh-Durham travelers take note: American Airlines and US Airways are finally moving side-by-side in Terminal 2. The switch will occur overnight on Monday, August 10. Two days later, Delta Air Lines and United Airlines will also swap ticketing locations.
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