Posted by Seth on October 24, 2009 under News | 
It is earnings season again for airlines with most reporting their quarterly results this past week. As has been typical for the past several quarters, most airlines are showing up with less money than they had three months ago. In many cases the loses are staggering, though not nearly as bad as a year ago when fuel costs were roughly double today’s prices.
Still, there are a few airlines that showed up reporting profits. In the case of jetBlue the profits were actually a decent size. More importantly, however, is that they were stacked on top of profits from previous quarters. It seems that they’re really doing something right there and the numbers are reflecting that. Unlike other carriers that are shrinking their route maps and capacity, jetBlue is growing. Capacity in 2009 will be roughly level with that of 2008 and will actually be up significantly – about 35% over 2008 – in the Caribbean. Apparently that’s where the money is these days and jetBlue is going after it with great gusto.
One of the numbers that jumped out as I listened to the quarterly earnings report was the ancillary revenue reported per passenger. With the unbundling of services and a shift towards incremental charges for everything from pillows to pets in the cabin the ancillary revenue number is one that can make or break an airline these days. For the past quarter jetBlue reported an average of $17.50 in ancillary revenue per customer enplanement. Not too shabby but lower than expected. Why? Because there are fewer change fees coming in. The advance booking curve is shrinking so it is more likely that customers know when they are going to travel, not just booking early, hoping for the best and changing when the actual date gets closer.
There were a couple other interesting bits that came out of the earnings call. One is that jetBlue still appears to be operating like a feisty startup, not like a staid legacy carrier. They’ve got growth on their mind, with lots of planes scheduled for delivery in 2011 and beyond. And they actually seem a bit excited by the prospect of competition with other carriers. CEO Dave Barger had this to say on the topic:
Where there are competitive skirmishes we’re certainly going to defend our turf.
That sort of attitude definitely explains adding additional frequencies on the new and highly contested Boston – Baltimore route, for example.
And there were a number of “never say never” types of things that the carrier was asked about, including charging for the first checked bag. It is not going to happen now but reading between the lines I wouldn’t be surprised to see it come about shortly after the Sabre system goes live in Q1 2010, along with exceptions for full-fare and other similar things that can only be logistically managed with a complex booking system like Sabre offers.
And the best news of all, at least to me, is that the All You Can Jet promotion was wildly successful – and profitable – for the airline. So much so that they’re quite keen to repeat it in the future. It was actually revenue positive and the marketing buzz was huge. It was, quite simply, “[T]he most successful promotion in our history,” according to Barger. Sign me up for the next round; I’m ready to go!
Posted by Seth on October 21, 2009 under Internet |
In a move that hasn’t garnered nearly the same publicity as Virgin America’s announcement that they’re teaming up with Google, American Airlines has announced that they are teaming up with Lexus to provide free wifi to users of the gogo system on their flights. The AA promo is much more limited – only 7 days – and requires one to know a special promo code – 2010LexusLS – so it isn’t nearly as good as the Virgin America deal. But something is better than nothing.
Full details on the promo are here.
Posted by Seth on October 21, 2009 under News |
I don’t know Gabriel Leigh, the guy who put this together, but I do know a number of the folks being interviewed. And I have to say it is pretty much dead on accurate. It is about 20 minutes long and tells the story of people searching out the ever more tempting search for miles, travel and discovery of new places. But mostly just about the miles.
Frequent Flyer from Gabriel Leigh on Vimeo.
The bit around minute 15 regarding the Baht run is particularly funny. Apparently being a frequent flier isn’t all that far away from being the world’s stupidest drug mule. Having been called such at one point, I can relate.
Posted by Seth on October 19, 2009 under Internet |
Two big stories out today about in-flight connectivity, both of which have me very excited.
The first is an announcement from Virgin America and Google that the latter is going to be sponsoring the gogo service for a two month period – November 10 – January 15. No credit card, no restrictions. Just an email address and accept the Terms of Service and you’re online. Considering that I have a flight booked my first on Virgin America) for November 11 from Los Angeles to JFK I’m pretty happy about that for very selfish reasons.
The second story comes from The Runway Girl, one of my favorite reads for in-flight entertainment news. She’s at the NBAA conference this week and has been reporting all sorts of cool stuff. The coolest, however, is an announcement from LiveTV, the jetBlue subsidiary that operates the in-flight TV systems for that carrier and Continental, among other things. LiveTV has been suggesting that there is a good chance additional in-flight internet connectivity will be coming online in 2010 and the latest news is that they’ve got an antenna ready to go for providing the service. Even better, the cost of operating the service is so low that they expect airlines to be able to offer it on a complimentary basis to passengers. Oh, and did I mention that the service would be available absolutely anywhere on the globe – including the polar regions – thanks to the fact that it uses the Iridium satellite network? This is nothing short of huge in terms of in-flight connectivity.
Now we just need LiveTV to finish up the R&D part of the project and get to the implementation phase so that I can have my emails for free in flight.
It is pretty clear that there is a demand for internet connectivity in-flight. And the fact that companies are continuing to find ways to reduce the costs to the end-user – something that will be critical to actually seeing high adoption rates – is a wonderful thing. Free is always better, right?
Posted by Seth on October 19, 2009 under News |
A couple weeks ago British Airways published what appeared to be a great sale fare for flights from the USA to India. I want to go back to visit India, as does my wife. So I bought a couple tickets and we started planning. Just about 72 hours later, however, BA decided that they actually didn’t want to sell the seats at that fare. Three days after I bought our tickets, the airline cancelled them. Sure, I got a nice email claiming that the sale was a mistake. But that was it. Eventually a relatively worthless $300 coupon also showed up but, well, it is relatively useless.
I tried to talk to them about the situation but they really don’t like taking phone calls. I actually managed to defeat their auto attendant system and got to a human. Their customer service rep told me that if I didn’t like the decision I should “fly another airline” or speak to their legal department. But there was no phone number available to contact said group. Well a bit more ingenuity and a week of trying yielded some results. I got a phone number for the legal departments and played phone tag (mostly me tagging them for a while) with the crew there. Eventually I managed to speak with someone in their legal department. Jim wasn’t particularly interested in having a conversation, however, essentially telling me that I’d get nothing and I’d like it.
And that brings me to my $20 worth of fun. It is amazing what $20 will get you at the Clerk of the Court’s office. In my case, it is a trial date in Small Claims Court for Manhattan. Just fill out one short form and hand the clerk $20 and you get a trial date. Mine is December 3, 2009. I’m very much looking forward to it!
And I didn’t even have to take the $20 from Mother’s wallet (very obscure movie reference – UA or CO drink chit in the mail to the first to get it right).
Posted by Seth on October 13, 2009 under News |
As it approaches its tenth birthday, jetBlue has unveiled a new livery tonight. And I have to say that it is rather nice. The name of the carrier is much larger on the body:
And they’ve got a tail fin that is curves rather than the linear patterns of previous versions:
Lots more pictures from the release party happening tonight in Orlando can be found on jetBlue’s Flickr page here.
Posted by Seth on October 13, 2009 under Uncategorized |
As reported yesterday, United Airlines has made some significant changes to their elite upgrade program. They’re getting rid of certificate-based upgrades for the most part and switching to a status-based upgrade solution instead. This brings them in line with Continental, their new partner, and also makes their program operate similarly to several other legacy carriers in the USA. As with any change there will be winners and losers. In this case, however, it seems that the number of losers might outweigh the winners.
Here are some of the details as announced:
- Upgrades will be processed starting at 120 hours for GS, 100 hours for 1K, 72 hours for a 1P and 48 hours for a 2P
- Upgrades are for the ticketed passenger and up to one companion on the same PNR
- Upgrades will be prioritized by status, fare bucket and time of ticketing (earlier is better)
- Upgrades will apply to domestic segments on international itineraries
- No double upgrades (Y –> F on 3 cabin planes)
- No upgrades on p.s. transcon routes
- CR-1s will be issued for the last time in Q1 2010
- e500s will no longer be issued starting in 2010 and cannot be purchased
- SWUs will remain
So who wins and who loses?
The top tier elites – GS and 1Ks win for the most part. They’re much more likely to get their upgrades and they don’t have to worry about managing their certs or buying extra e500s if they are running low. The lower tier elites are definitely losing in many cases. Because there is no longer a need to manage certs upgrades on shorter and less desirable flights will no longer be available for lower tier elites. And everyone loses on the lack of upgrades for p.s. flights.
Everyone who enjoys confirming upgrades in advance also loses, as they are not going to have CR-1s available in any reasonable quantity as 2010 comes to a close. That means advance upgrades will only happen if SWUs or miles are redeemed. Ditto for folks who like to upgrade a companion. It depends on how United programs the system, but limiting upgrades to only one companion and only if they are on the same reservation is quite a change from the existing policies.
Losing out on the CR-1 upgrade certificates is also a major pain point for United elites. The certs are pretty easy to earn and are incredibly valuable. And they are going away. Sure, there is a cooling off period where they’ll still be earned (into early 2010) and redeemable. But no more new ones hurts. It slightly increases the value of the points earned since they’ll be the best way to upgrade going forward.
Another interesting factor is that United has quite a few planes with very small forward cabins. Their A319s only have 8 F seats. Lower tier elites can pretty much kiss those upgrades goodbye. And while Continental also has a few planes with small cabins, they are generally only used on shorter flights; United uses their A319s on transcons. That is going to hurt.
Free upgrades on domestic segments of international itineraries is nice, but those were always upgradable under the old cert system, too, so no huge change there. It will make it a bit less fun to use one e500 for an upgrade from LAX-HNL-SFO (yes. that works), but if the upgrade happens anyways who cares.
This move brings United incredibly close to Continental in terms of their upgrade schemes. The only substantial difference is the timings of the upgrade windows. Pretty much everything else matches. That means there is a VERY good chance that Continental and United can start offering reciprocal upgrades as they align their programs. Of course, further details on that won’t come out until after Continental officially moves into Star Alliance and is able to officially start tying systems and programs in with United. Lots more fun to come.
Posted by Seth on October 13, 2009 under Internet |
After a lot of speculation over the past couple weeks, Lufthansa has made it official: they’re bringing in-flight internet connectivity back to their long-haul fleet. And this isn’t just the old Connexion service pressed back into service. It is going to be bigger and better than that.
The new service will offer a 1 megabit internet connection to be shared by the passengers (slower than that provided by Aircell’s gogo service). It will also provide access to GSM/GRPS data streams, facilitating SMS and MMS messaging as well as internet browsing on mobile phones. From the announcement:
FlyNet is impressively user-friendly. Passengers with a WLAN or GSM/GPRS-compatible device can log on from any point in the aircraft cabin, just like at any public hotspot. Depending on the device they are using (i.e. a laptop, mobile phone or a smart phone), passengers can choose to be billed via a mobile service provider or pay by credit card. Various different price models are planned – ranging from a rate by the hour to a monthly flat rate. Passengers should also be able to redeem Miles & More award miles for the use of WLAN Internet connections. The exact price for specific products will be announced at a later date. The service will gradually become available on all Lufthansa’s long-haul flights worldwide.
So it’ll be the middle of next year before it is readily available, but the service is definitely coming. Now it just remains to be seen if they can offer it at a price point that allows it to survive. The terrestrial services seem to be suffering there and it isn’t clear that the satellite services are going to fare any better. But we can hope.
Posted by Seth on October 12, 2009 under Uncategorized |
In a move that brings it much, much, much closer to soon-to-be BFF Continental, United Airlines announced today that they are switching to an unlimited domestic upgrade program for their elites. They’re ditching the e-500s and CR-1s and going to a format that will put all elites in the queue for upgrades and dole them out based on status.
The details are coming out tomorrow so we don’t know everything yet, but there are plenty of UA customers who aren’t so happy about the change. And I can’t blame them. With the existing system lower-level elites actually tend to get more upgrades since they’ll put in for the otherwise “worthless” flights, like Chicago to NYC. Why? Because they fly less so they have to use their certificates up at some point. Under the new scheme higher tier elites will get the upgrades every time, without having to spend any currency.
The move will bring UA’s upgrade scheme into alignment with that of Continental. Based on that, and the new partnership that officially starts in 2 weeks, it makes a lot of sense to also expect reciprocal upgrades for elites in the two programs starting in the second half of next year.
The future of e-500 upgrade certs and CR-1s, the lower-level upgrade papers that UA gives out is definitely in question right now. I’m betting that they disappear rather quickly but that the holy grail – the System-Wide Upgrade – remains in play. And maybe Continental will start to issue them as well.
There are going to be lots of changes over the next 12 months thanks to Continental’s move from SkyTeam to Star Alliance. This is but one of many bits that frequent fliers will get to gnash our teeth over.
Posted by Seth on October 12, 2009 under Uncategorized |
Road closures, heavy police presence, annoying news stories about various world leaders. Nothing good can come out of the UN General Assembly meeting each fall in New York City. At least, that’s what I used to think. Now I know better.
In addition to all the headaches and whatnot that come from the meetings there is also one truly phenomenal opportunity for aerophiles – plane spotting at JFK. As the gateway to NYC, JFK receives scores of international dignitaries during the week leading up to the big meeting and there is a similar outflow after the sessions conclude. And the planes that show up are a lot of fun.
These are planes that don’t make it to the United States very often. Ilyushins and Tupolevs. Airbus A300s and A310s. Even an A342 and a Boeing 747SP – one of the originals – arriving in from Iran. Gambia sent a 727-100 and Burkina Faso sent a 727-200.
It is, quite simply, plane spotting nirvana.
Here are a couple thumbnail images from some of the folks who were out spotting this year. I’m going to need to check out the schedule for next year and see what I can do to be out by JFK for this event.
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| Gambia’s 727-100 |
Iran’s 747SP |
Russia’s IL-62 |
Good stuff.
