The OTR Has Moved — Update Your FeedsJanuary 24 2008
Hi all,
I’m moving my blog over to a new platform (with the Boarding Area group of blogs run by the Flyertalk guys…) The blog will basically look the same, and the address will still be Onlinetravelreview.com, but the feeds are going to change. If you read this via a feed, please visit http://www.boardingarea.com/blogs/onlinetravelreview/feed to grab the feed you want.
United: We’ll Leave Star Alliance If It Helps MergerJanuary 24 2008
Although it’s still pretty unlikely, United would consider dropping out of the Star Alliance if it was necessary to complete a merger, according to this article.
United also would consider withdrawing from the Star Alliance, the
global marketing consortium it co-founded, if needed to close a deal.
"You can assume that absolutely everything goes into the mix of
consideration," (CEO Glenn) Tilton said.
I guess they’re serious.
Other changes are already happening, with the airline announcing plans to sell off its Mileage Plus program, as well as a maintenance base at San Francisco.
They announced yesterday that they would cut about 4% of domestic capacity, while Delta also announced about a 5% drop in domestic capacity for 2008 (while at the same time increasing international flights, where they already do 1/3 of their flying).
The shrinkage in the number of available seats domestically will be a (the?) big story for the year, as airlines try to figure out the correct mix of flying. Remember — too little domestic capacity and you’re not feeding enough traffic to your hubs, which leads to fewer international passengers. It’s an enormously tricky balance, and one that will lead to higher fares for consumers. At least until a lowfare carrier sees an opportunity in these now thinner routes with high fares. An AirTran (or whoever) will jump in, lower fares and increase the number of flights. Which will, of course, be met be the incumbent with lower fares and more flights, which will cause them to lose money. Rinse. Repeat.
Ryanair: We’ll Keep Raising Bag Check Fees Until You Get Smaller BagsJanuary 24 2008
Ryanair announced an increase in the fees it charges for checking luggage to GBP 6 (about $12, $13 if you pay in Euro). The carrier has said that it will keep increasing bag check charges until 50% of passengers only use carry ons. They also increased the fee to check in at the airport to GBP 3.
Air New Zealand and United Cancel Routes from Los AngelesJanuary 24 2008
Two quick notable route cancellations:
Air New Zealand is dropping its thrice weekly service between Nadi, Fiji, and Los Angeles in April so it can use aircraft on more profitable routes. Codeshare partner Air Pacific will pick up 2 of those frequencies, bringing their number of weekly flights to 6. Air Pacific isn’t as comfortable as Air New Zealand, especially when they’re packing 452 seats into the coach cabin of a 747.
And United is canceling its LAX - San Salvador flights in February, a route it has flown since the breakup of Pan Am in 1991. TACA, a United codeshare partner, will pick up some of the slack.
Lufthansa: German Travel Agents Are Going to PayJanuary 23 2008
For you airline distribution nuts out there (?): Lufthansa is now charging German travel agents 30 Euro ($60) for the right to sell a Lufthansa round trip flight. Why would you care about this? Because if this catches on, we could start to see discriminatory fares (ie, you’ll pay up to $60 extra) when you book anywhere other than with the airline directly. I don’t expect this to happen in the US tomorrow, but just know that it’s on the backburner, and this wouldn’t be good news for corporations, who will be sucking up most of these charges.
Skybus’ Average Fare to Kansas City? $25January 23 2008
Someone on Airliners.net has put up an interesting post about Skybus’ average fares by market. I mentioned a couple of weeks ago how their yields were terrible; now we have some detail on that. Average fare between Columbus and Kansas City was $25. Only the Oakland route had an average fare above $100. Sure, they had some ancillary revenues on top of these, but this shows the extremely difficult pricing environment they’re operating in (you think they WANT $25 average fares?). I don’t have much to add from what I said in the earlier post, but the detail on this is pretty interesting.
Norwegian Airline Coast Air Goes BankruptJanuary 23 2008
This will affect roughly zero of you, but Norway’s 4th largest airline (now THAT’s a tagline!) Coast Air has declared bankruptcy and canceled all flights. The airline was founded in 1975 and flew to 8 cities in Norway and handful of international destinations (Gdansk, anyone?)
Go! : We Lost $20 Million in 16 MonthsJanuary 22 2008
Go!, the upstart airline in Hawaii that managed to really piss off Aloha and Hawaiian, just announced that they lost $20 million in their first 16 months of operations. In case you had been wondering how an airline could make money charging $19 to fly between Honolulu and Lihue, you were correct to wonder: they wouldn’t make money doing that. Oh, and Aloha & Hawaiian managed to lose more than $60 million during the same time frame, certainly in part because of the depressed fares that hurt everybody.
So, new entrant comes in, 3 companies lose $80 million in 16 months. On the plus side, it’s really cheap to fly between the islands. On the downside, that’s because they’re not covering costs.
Delta: If You Want to Merge, We Keep the Name (Maybe)January 22 2008
The AP is reporting that Delta Air Lines is insisting that, should it merge, the new airline will have the Delta name and be headquartered in Atlanta.
I’ve often said that there’s some truth in every rumor, so I don’t doubt that this issue has come up, but do you really think they’d kill a multi-billion dollar merger and a chance to build a successful company because it won’t be HQ’d in Atlanta? I doubt that, even if I think it’s true that they’d prefer if it were located there. Don’t believe everything you read.
Thai Airways Flight Attendants: We’re Not SlutsJanuary 21 2008
The union representing flight attendants for Thai Airways demanded the cancellation of a Thai television show called "The Air Hostess War" that featured a plot about a Thai Airways flight attendant having an affair with a married pilot. The union says the program showed flight attendants in "an unrealistic and immoral light…It’s all about sex and air hostesses beating each other up in the
cabin because of love and jealousy. This kind of thing never happens." (Beating each other up in the cabin?)
This is somewhat reminiscent of when flight attendants from Icelandair protested when an episode of the Sopranos showed Tony Soprano sleeping with a flight attendant from the airline.
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