Want to save hundreds of dollars in fuel surcharges on Qantas award flights between Australia and Europe? Turns out it is a trivial task.
Photo from the Qantas/Emirates flyover of Sydney Harbour courtesy of Qantas
Thanks to the recent partnership between Qantas and Emirates has created a number of interesting arbitrage opportunities for members of the Qantas Frequent Flyer program. Included in that is a sizable gap in the fuel surcharge the two carriers levy for similar trips:
Travellers wanting to fly economy from Australia to London return have been able to escape paying $610 in fuel surcharges by redeeming their frequent-flyer points on an Emirates flight rather than Qantas.
A passenger flying one-way in economy or business on Qantas from Australia to Europe has to pay $380 in fuel surcharges, while on a flight to the US it is $340 and to Asia $175.
In contrast, Emirates charges $75 in fuel surcharges for a one-way economy ticket to Europe, and $30 to Asia. For business class, the surcharge for Europe is $230 and for Asia $165.
And the part where Qantas made searching for Emirates award seats incredibly easy by integrating such into their online award booking engine isn’t hurting the situation either.
The bad news for customers is that the two carriers are set to meet in the coming weeks to discuss this issue, among other things. Apparently they recognize the issues they’ve created for themselves.
Of course, this is not the only place where similar routes can attract widely varying fuel surcharges depending on the operating carrier of the routes. American Airlines will pass on the YQ from British Airways when redeeming AAdvantage points on BA metal while a similar flight on AA metal has no surcharge. ANA’s Mileage Club or Aeroplan have similar variations for partner flights. Certainly not a fuel dump in the traditional sense of the term, but the net savings apply in roughly the same manner.
If anything is unique about the Qantas/Emirates situation it is that they are apparently trying to address it rather than just hoping for the best.
By my rough calculations I should be about 500 miles off the western coast of Chile right now, happily ensconced in a LAN business class seat next to my wife as we wend our way to Easter Island for the Memorial Day Weekend holiday. Alas, instead I’m sitting on my couch at home having just cancelled the last bits of the trip. Being healthy is far more important that going on the trip so we’re focused on that. But I’m also not going to simply throw away the trip completely. There was a decent amount of work to be done to unwind all the bits I had assembled.
Our trip consisted of two separate reservations. One was the American Airlines sale fare from NYC to Chile for ~$950 in business class. I booked that as an open-jaw into Easter Island and out of Santiago so that we could see both. I added on an award via British Airways Avios from Easter Island to Santiago.
For the AA ticket I did what I’d normally do on a non-refundable trip where I need to make a change; I called and begged. OK, not quite that bad, but that’s basically what I did. Alas, the agent reviewing the record stood firm and even with a doctor’s order not to fly the $200 change fee plus fare difference was going to stand. Don’t get me wrong – I still am coming out ahead in the long run paying the fee versus buying travel insurance given how many tickets I buy – but I was a bit miffed that even with a doctor saying she couldn’t fly there was no waiver of the fee. And so I did what seemingly everyone else does when "wronged" by a company. I got passive aggressive on Twitter.
The @AmericanAir team took a look at the record and after a handful of DMs eventually agreed to waive the $200 change fee for us. I’m calling that a win. Honestly, I couldn’t expect them to honor the fare, too, particularly given that I had partner segments in there. I would’ve preferred that, obviously, but I’l take what I can get.
For the second flight it was a bit easier to manage. The Avios reservation has a published cancellation fee schedule ($40/ticket) and I figured that was a reasonably small penalty for getting our 25,000 Avios/ticket refunded. The BA website actually made the cancellation process pretty easy. A few clicks and I was done:
As an added bonus, I actually wasn’t charged the $40/ticket to cancel. I had only paid $13.42 in taxes on each ticket and the refund process had me forfeit that portion of the refund but didn’t charge me anything extra. It seems that their refund process (at least online) doesn’t have the means to initiate a charge as part of the transaction. So if the taxes/fees are lower than the threshold that’s all you pay. It actually makes Avios even more valuable for domestic US trips now, in my opinion; refunds are essentially free.
It turns out that my procrastination in booking a hotel for Santiago worked out in our favor; I hadn’t booked one yet so there was nothing to cancel there. For Easter Island, on the other hand, my 4-night booking at Inaki Uhi was complete and I was past the refundable cut-off point for the booking. Fortunately I had been in communication with the proprietor via email and after I explained the situation he was graciously willing to waive the penalty. I do expect that we will eventually make our way to Easter Island and I fully intend to stay as his property when we do; that he was willing to waive this only reinforces that plan to me.
Again with the procrastination bit…there really wasn’t anything else to cancel or change. No rental cars, tours or similar. Turns out I don’t usually book many of those things when I’m traveling anyways.
And so I’m sitting here, wondering what to do with ~$950 each in American Airlines credit. There are plenty of options, obviously. None are going to be as awesome a deal as Easter Island in business class but certainly we can still have some fun. Maybe Brazil, Central America or diving in the Caribbean. Using AA to Aruba and then hopping to Bonaire and Curacao, too, has been on my list for a while so maybe that’ll be part of or plans for this summer. Roatan, Honduras has also been on the list for a while but that’s Saturday-only service and I’m not sure I want to be in one place that long. Or maybe I’ll just make a couple mileage runs out of it, hopping around for no particular reason. That’s not too likely (especially as my wife certainly wouldn’t appreciate it) but it is an option.
Ultimately the lesson here – at least for me – is that the plans may have changed from what I initially expected them to be, but we didn’t really lose much in the process. In hard costs I’m out $26.84. I think I can handle that. Even if American has stood their ground the total would be $426.84; still not horrible considering our annual travel budget.
What would you do with $950 in credit from American? Where would you go?
Call it a win for nostalgia, as well as an opportunity for the company to throw a little party and let their employees celebrate: United Airlines is celebrating 25 years of hub operations at Newark this year and today was the main event. The party today also included an unveiling of the new uniforms for the airline. In addition to inviting many employees and media types in to celebrate the company also invited a few dozen customers to the event. Not surprisingly, I made sure I was on the list to attend.
There were a few “typical” moments at the party, including speeches by the CEO and local elected officials. I’d say more than a typical number of senior employees were at the event and they were quite willing to chat with the invited guests. There were also some very cool things available, such as a rather impressive display of memorabilia from the past 25 years or so on both the Continental and United side of operations. For me that was probably the highlight.
Old-school paper tickets
70s-era safety cards
Note the smoking/non-smoking designation on the old ticket jackets
The party involved the unveiling of the new uniforms for the crew. They will go into service on June 25, 2013. They ran a fashion show on the stage; I only saw it from afar so the photos I got aren’t the best.
The new United uniforms
The new United uniforms
There were also a few games/contests going on. One involved tossing a balsa airplane as far as possible. Making it to the orange cards got a $25 voucher; making the red earnt 25,000 MileagePlus points. I don’t know that anyone made the red but several made the orange.
Balsa plane toss
The birthday cake was from Cake Boss in Hoboken. He got more applause than anyone else at the event, including Smisek.
Cake Boss got more applause than everyone else
There was also a follow-up event where a number of 1K and GS elites from the area were invited to attend. Most of the executives hung out for a bit. During our 30 seconds with Smisek he mentioned that the final two 787s will be finished with the repairs this week (the other four are already completed) and that he’s very much looking forward to the A350s joining the fleet, among other things.
Does this run SHARES??
All in all, an interesting few hours of my day. Nothing incredibly revealing or revolutionary but decently fun.
When hotel booking engine PointsHound started up late last year there were some notable limitations to the service. Most significantly, like other OTAs, bookings made through the site would not earn points or stays in the hotel loyalty programs. While that’s no problem for some customers (like me) it is a deal-breaker for others. Earlier this year the company quietly introduced a limited collection of hotels where they are now able to offer elite benefits and points earning for stays, in addition to the airline miles for bookings. It turns out Hilton HHonors is no longer the only way to “double dip.”
That initial work was more a proof of concept than a final product. This past weekend the PointsHound team finished a major update to their site and one of the big changes was that they now have more than 3,200 hotels across 115 US markets where their customers can “Double Up” on bookings.
Searching their list of hotels you may come across an orange icon at the bottom of the entry which looks like this:
Book that hotel and you’ll earn both the airline points from PointsHound for the booking and also all the traditional benefits which come from direct booking through the hotel’s website.
Here are the rates for a PointsHound-only room and a double earning rate (and, just for fun, the direct booking rate) at a couple hotels on the same night for the same room:
For the same per-day rate you can walk away with 2600 free United Points (based on being a Level 2 PointsHound user). Or take slightly fewer points and a non-refundable rate and save some cash on the nightly price.
A Hyatt Place:
In the case of the Hyatt Place stay you are potentially giving up 100 airline points in favor of earning your Hyatt Gold Passport points. In the case of the Marriott you actually get MORE points by booking it as a stay which also earns Marriot Rewards points. And in each case you’re getting more benefits than just booking directly through the hotel’s site directly.
Of course, there is the rather notable catch that the option doesn’t exist in all cities, much less all hotels in any given city. Still, if the option works for the location you’re in and the property you’re interested in that’s a nice win. In cases where the price and earnings are otherwise the same this might even be enough to sway someone like me – a skeptic on the value of hotel points – to go for a booking engine which allows lots of earning options.
Also worth noting is that PointsHound has a promo out for some bloggers now whereby you can get a 60-day trial of Level 2 status (more points earned per night) and 250 bonus points for
signing up completing your first stay and the blogger gets 250 points. I’m pretty sure Gary even negotiated that the user can get all 500 if you want to sign up there. If you want the bonus points and Level 2 status you can use my referral link here. The main link atop the post is a generic one.
Google loves to have fun with their maps product, often offering up entertaining instructions like swimming across the Atlantic Ocean, riding a jet-ski between Japan and China or sailing from Seattle to Honolulu. A new feature in the latest update – currently showing only in the preview version of the site - has a much more useful addition included, even if it looks a bit like the “play” versions of the maps: flight options are now being integrated with the directions searches. Here’s a screenshot sent to me by a reader earlier this week:
Given the particular city pair the site gives an option for the driving route or flight options, including the blocked time gate-to-gate and a starting point for airfare. Obviously the airfare number will change depending on the specific flights and travel dates but it is still interesting to see the starting price point there.
Google still isn’t actually selling the tickets so there are a few extra hoops to jump through to get to the purchase point. Still, seeing the multiple data streams integrated into the single interface is a big improvement. Sure, they have train schedules from Europe integrated into their “directions” applet in the maps (Frankfurt to Munich by train) but no fare data inline (links are provided). For the Japanese train system the fare data is included (here’s Tokyo to Kyoto) but some of the details seem a bit amiss (14 minutes on the JR line is 50% more than 2:20 on the Shinkansen!?!). Obviously this isn’t the first time Google has tried to integrate the multiple streams of data into a useful view for users.
At the same time, however, it is somewhat new in a few ways. It mixes the driving and plane options in a single view rather than requiring a user to switch “tabs” in the map interface. It also appears to have the ability to push through to the Google Flights interface for more detailed searches and, eventually, pushing you off to a point of purchase with the specific details already selected. That’s a step up from the connectivity that is available today, though not a full integration (like Apple might be pursuing).
Ultimately not the biggest development in the travel world this year, but it is darn cool. It will be interesting to play with it and see how it does with routes which don’t offer non-stop service or where longer flights are involved. I hope my invite to the preview program comes soon!
Last November when Elite Airways announced their intentions to start service in 2013 I suggested that the choices they made in terms of their hub and initial destination were probably suspect. It seems that they agreed on those aspects, shifting a lot of the details around. But, somewhat surprisingly, they are actually still planning on launching service. The latest version of the story has them in business starting in mid-July, with Baton Rouge, LA as their hub.
This time around there are no destinations yet announced and no indication of when seats will go on sale. There is a suggestion that they’ll upgrade their fleet to include some 737s, in addition to the CRJ-200s they currently operate. That’s a potential win for passengers, though it isn’t clear if they’re going for new planes or picking some old ones up second hand. Either way, just about anything is better than flying on the CR2 so I suppose it doesn’t matter too much.
Without a hint of destinations it is hard to guess at the chances for success of the operation. Reading the comments on the story (presumably from locals) it seems that Cancun; San Antonio; Washington, DC and Newark are being requested. I’m betting against all of those being included. Actually, Cancun might have the best chance of success.
Anyways, I suppose I’ll have to find my way to Baton Rouge at some point later this summer to give Elite Airways a try. Assuming they actually do get off the ground, of course.
A few months ago American Airlines quietly (or so they thought; turns out JohnnyJet was on a test flight so news spread quickly) started testing a new boarding process for their flights. The key change was that passengers with only small carry-on bags (i.e. underseat sized) would be allowed to board following Group 2. The theory is that these passengers are being rewarded for not putting bags in the overhead bins and they aren’t slowing the boarding process so they can board whenever they want (after the elite status passengers). But does it really matter?
One report on the process suggests that the total average time savings is 2-3 minutes per flight. Sure, multiply that out by thousands of daily departures and it sounds like a ton of time “saved” daily, but it really only counts if they change the flight times to account for that supposed savings. At 2-3 minutes on average per flight I’m betting against them adjusting block turn times for the flights.
Beyond that, however, I also cannot help but wonder which passengers are actually happily taking advantage of this benefit. Most of the race to board early is – at least from what I’ve seen – people trying to make sure they have space to stow their bags. If you don’t need overhead space it doesn’t make sense that there would be a great rush to get on the plane and cram yourself into a space just over 17″ wide and ~31-34″ deep, a small space that you’re going to be stuck in for the next many hours.
In other words, unless you absolutely need to be on board, why would you subject yourself to more time on the plane??
Don’t get me wrong – I love flying on a plane. And that means spending a lot of time on planes. But I also don’t go out of my way to be the first person on board. And when I’m traveling very light (which is most of the time these days) I happily board towards the end of the process, tuck my bag wherever it fits (including under my seat sometimes) and get going. Yes, I prefer to have the bag overhead, but that’s not the type of passenger this program is supposed to appeal to. This is for passengers who don’t have much in the way of a bag, for whom the need to get on board to store their stuff is key.
Maybe I’m missing out and there is a huge group of passengers who really, really, really like sitting in coach seats and want to do more of it. I suppose it is fantastic for that group. But it seems unlikely to me that anyone really benefits from this move.
More than that, however, there is also a reasonable concern that this will actually make things worse. Here’s one view which isn’t completely off-base:
If all the small things are put in the overheads because those passengers get on first that means more gate-checked bags, not fewer. Whoopsie.
I’m not completely convinced that it will be a problem, but I’m also not convinced this is a change which makes things better for many passengers. Certainly not enough to justify potentially pissing off a lot of other passengers for it.
What am I missing??
‘Tis the season for changes to flight change fees, it would seem, and JetBlue got in on the action this week. Yes, the change fees went up 50% ($50->$75 for cheap fares and $100->$150 for more expensive tickets) but the news isn’t all bad. There is now a tiered fee schedule for flight changes which is arguably more fair than most airlines (short of not charging any fees). And, for their Mosaic members the new rules are even more generous – no more fees.
For regular customers there is now a 60 day cut-off point where the fees change in price. Here’s what the schedule looks like now:
For customers who fly JetBlue enough to rate the Mosaic badge elite status, the changes are even better. No fees at all. Ever. Even if you cancel the ticket for a full
Beginning with bookings made on May 17, 2013, Members with a valid TrueBlue Mosaic badge will not pay the applicable JetBlue change/cancellation fee when they change or cancel their JetBlue flight or JetBlue Getaways vacation reservation by calling JetBlue. The change/cancel fee will also be waived for any traveler on the same reservation as the Mosaic member…. Mosaic members must call JetBlue to change or cancel their reservation in order to receive the fee waiver benefit; any change or cancellation made online will not qualify for this benefit.
This new policy
is a step up from matches that of Alaska Airlines, the other carrier with a published policy of fee waivers for top elites. In the Alaska Airlines case it is only a waiver of change fees, not for canceling a trip, too. Even Southwest won’t refund tickets (just no change fee). JetBlue has essentially made every ticket fully refundable for their top elites. That’s huge.
JetBlue continues to respect that change fees more than the fare itself are silly, so that’s a good thing. And the 60-day split is likely a more accurate reflection of the resale challenges of that same space, made a bit more challenging because JetBlue doesn’t overbook as a matter of policy. But the biggest winners here – by far – are the Mosaic members. No more fees ever makes it incredibly easy to justify buying more of their tickets on JetBlue more often.
Also, there is still the free repricing of the same flight for a credit if the fare goes down which is available to all customers.
Let’s say, hypothetically speaking, that you’re looking to make a splash in the travel market. Sure, you already might have some products which allow your users to display a boarding pass or track flight status, but you are always thinking bigger. You want to have a fully integrated reservations system, not just displaying bookings made elsewhere; you want to fully own the process. You’ve also got a few patents which seem overly broad in some ways, but which should cover the unified booking, management and actual travel process through a single interface. Oh, and you’ve also got more than $145 billion sitting around, looking for a useful outlet. What’s your next move?
The key component to the booking and management process is the Global Distribution System (GDS) platforms which work as the middle-men between travelers and service providers. There aren’t too many players in that space and there are plenty of reasons to be wary of their profit potential, especially from the airline side of things. Still, if you want to build a massive travel solution having your own GDS is a pretty efficient way to approach the situation. Why bother negotiating API integration and fee structures when you can simply own the whole platform? Especially when there are other, ancillary benefits which might come with that purchase?
There are arguably three major players in the online consumer market today: Microsoft, Google and Apple. In April 2008 Microsoft purchased Farecast, integrating the historical fare data and prediction algorithms into their Bing Travel platform. Google made their move a couple years later, snapping up ITA Software in 2010. The ITA platform is much closer to a full GDS than what Farecast offered, though it doesn’t have the direct-to-consumer front-end aspect of things in place. Apple has been competing with Google in many areas recently and getting a leg up in the travel space – a market with huge amounts of money (and customer affinity) in play – is not such a bad idea. The only real company in play right now is Sabre and the company is once again raising the idea of launching their IPO; if Apple wants in on the action now is the time to act.
To be fair, the patent details are mostly focused on how to use NFC or similar technologies for the passengers’ mobile devices to talk with other systems so that check-in and boarding can be handled more smoothly, not about the overall booking process. But making reservations is mentioned several times and, if history is any indicator, Apple’s desire to control the whole process makes this sort of transaction quite feasible. Building a fully integrated booking interface from scratch is a ridiculously complicated undertaking and there is very little up-side to that approach. Apple would still have to negotiate access to all the underlying data, in addition to building out the management and processing systems and user-facing interfaces. That last bit is likely something they would want to redo anyways, but the back-end stuff is major work and buying a functional version in situ is a nice way to get a head start. It is also worth noting that Sabre is a lot more than just the GDS platform. Through its history Sabre has acquired or launched many other businesses, including travel agencies, online communities (IgoUgo) and booking engines (Travelocity). Yes, buying them outright would have a significant cash cost, but getting all the parts at once rather than assembling them piece-meal means the project would be live much sooner.
If Apple is going to get into this market they’re already facing an uphill battle. Roughly 75% of the travel agency market (including OTAs) is dominated by 4 key players. To break in to that space would require a disruptive shift, the type of move Apple has embraced in the past. They could play it slow, depending on travel providers to integrate into their Passbook application but the adoption has been somewhat slow. Also, there isn’t a ton of upside for the company for depending on partners to integrate into their ecosystem; Apple likes to control the whole experience. If Apple wants in on the hundreds of billions of dollars in annual online travel revenue, going slow into the market is a bad move.
Is Apple going to buy Sabre? I honestly have no idea. But there are rumors of such circulating (I didn’t come up with all of this all by myself) and, quite frankly, it wouldn’t be the stupidest thing they’ve ever done.
It sure is fun to imagine what they could accomplish if they did, though…
For nearly the past decade earning points for flights within Norway was not possible thanks to laws designed to encourage competition and prevent one airline from using their loyalty program to unduly attract or retain customers. Apparently (at least according to them) the rule worked and there is now sufficient competition in the market such that the rule has outlived its usefulness. It is not clear when the airlines will start to permit accrual on these flights (or, in the case of SAS, when their Star Alliance partners will update the rules). From the Google translate version of the announcement:
Government shares the concern expressed Competition for competition in the aviation industry, particularly in rural areas, when bonus ban repealed. But today there are two major players in the Norwegian market, and competition is more robust than when regulation was introduced in 2007.
Norwegian Air is the second carrier and they have grown significantly in both the domestic and regional markets. They’re introducing long-haul service this summer to Bangkok and New York City, too.
Also in the same announcement is this bit:
The Government will also examine the possibility of laws on the bonus points earned in employment attributable to the person paying for, normally the employer. The purpose of this study will be to examine whether it can reduce the administrative burden of enforcing taxation of the private use of bonus points earned on business travel as well as any negative competitive effects of repeal regulations.
Apparently letting the traveler keep the points rather than crediting them to the company buying the ticket raises tax issues. Hopefully the IRS doesn’t get any similar ideas.