Japan, USA sign open skies pact

Posted by Seth on December 13, 2009 under News | Be the First to Comment

The negotiations of the USA-Japan open skies treaty have been ongoing for quite a while now.  This latest round of talks, held last week, was actually extended by a day to allow for the final details to be ironed out since they were so close.  And ultimately the deal that they struck seems to be a very fair and very good one for the airlines and for customers.

Tokyo Service

With the exception of Tokyo all destinations in Japan are now accessible with unlimited frequencies by all American and Japanese carriers.  That is a significant step forward.  The Tokyo market, however, is key to pretty much all service to Japan and the agreements reached on that front are quite interesting.  Both airports – Haneda and Narita – will remain slot controlled due to the significant demand for service to those airports.  And the number of slots that US-based carriers have at Narita will actually decrease a tiny bit.  But there’s a good reason for that.

Tokyo’s Haneda airport – the more convenient and desirable destination for most passengers headed to Tokyo – is opening up to more international flights starting in 2010.  Some of those flights will be potentially operated to the United States under this deal with as many as four daily flights permitted.  That is going to be a very significant benefit for whichever carrier manages to secure those slots.  There are a number of restrictions on the new Haneda slots, including late night departure times which aren’t particularly ideal.  But it is better than nothing.

Anti-trust Immunity

There are some other interesting nuggets that came out of the agreement as well.  Anti-trust immunity (ATI) will be permitted on the US-Japan routes for the first time ever.  While there will still be specific applications required for such operations the ATIs will permit coordination of schedules, service and fares for partner carriers on routes between the two countries.  The Star Alliance carriers of ANA, Continental and United Airlines are best position to take advantage of the ATI opportunities and they’ve already announced their intentions to do so. The three carriers expect to be able to better coordinate their offerings and streamline operations.  In addition to the Star Alliance three, JAL will likely take advantage of the ATI opportunities once they figure out which suitor they’re going to dance with in the bankruptcy/bailout recovery effort.  Both Delta and American Airlines are still pursuing the carrier aggressively and being able to apply ATI policies to the operations following whatever deal might be reached will be rather beneficial to whichever partnership comes out of that deal.

Extra Freedoms

Finally, both countries will be removing restrictions on fifth freedom routes.  Fifth freedom flights are some of my favorites because the routes seem strange when viewed out of context.  They are flights operated between two countries, neither of which the airline is based in, where the airline is permitted to sell seats only on that route.  There are a number of such flight in Asia particularly, such as Air France flying between Bangkok and Hanoi or Ho Chi Minh City.  And there are a few in the USA, like Cathay flying from Vancouver to New York City’s JFK airport.  As part of this agreement fifth freedom flights will the permitted without restriction by Japan or the United States.  This is great for carriers that want to grow their route maps onward from Japan or the USA.  These “add-on” segments generally help to make flights that might otherwise not be profitable happen, so there is an increase in service between markets.  Plus there is the opportunity to grab the “other” flight generally rather cheap and have some fun flying on different carriers.

The loser on this bit is most likely Delta which acquired a number of route authorities ex-Tokyo when they bought Northwest Airlines recently.  That purchase gave them a number of slots and authorities from Tokyo and now all the other carriers who desire such will be able to get in the game on those flights, assuming they can find the slots.  Also, the third country will still need to approve the fifth freedom flights so it isn’t completely open, but there are many more opportunities now for many more carriers.

Mostly good, but potential gotchas

Overall, agreements such as this are generally a good thing for passengers.  The increased opportunities for carriers to provide service generally means that where they think there is a market airlines will try, at a lower cost than if they had to buy route authorities to provide such service.  The ATIs are always a bit of a toss-up as they essentially permit collusion and price-fixing between partners.  As long as there are enough non-partnered carriers in a market that generally isn’t a problem but it is something that always causes a bit of apprehension as it can lead to higher prices due to less competition. Still, there’s a lot of potential good news out of this agreement.  Now we just wait to see how it actually plays out.

AmEx cutting travel perks for cardmembers

Posted by Seth on December 22, 2008 under Uncategorized | Be the First to Comment

Sure, credit limits are being slashed all over the country, but that hasn’t hit me yet.  What has hit me are cuts to the travel benefits that AmEx offers for their Platinum and Centurion (“Black Card”) members.  The travel benefits were always of questionable value to begin with, depending on travel patterns and whatnot, but I’m pretty confident that they are truly losing most of their appeal, and doing so rather quickly.

The first benefit to go this year was one that was only recently introduced – a domestic 2-4-1 ticket deal for both Platinum and Centurion programs.  The program was limited, with blackout dates, only 6 carriers participating (the major legacy companies) and ridiculous ticketing fees on both the “free” and the paid ticket.  Still, I managed to use the program a couple times and saved $1-200 each time on flights I’d have taken anyways.  Not a bad benefit to have.  Sadly this one died about 5 weeks ago.

Next up were changes to the Mandarin Oriental benefit for the Centurion program.  I’ve only ever once stayed in an Oriental property.  We did so in Bangkok as part of our honeymoon.  It was phenomenal.  I’m not sure that I can really justify spending that much for hotel rooms on a regular basis (says the guy booking in to hostels for the next few vacation nights to save beer money) but it really was an impressive hotel.  The Centurion program offers a BOGO deal at each participating property.  Pay for one night and get a second night free, with a few minor limitations.  That’s a phenomenal deal.  The number of hotels participating continues to drop, however, and the substitute benefit is pretty miserable.  You now get a $200 food/spa credit instead of a free night.  Ouch.

And finally there is the fabled International Airline Program, AmEx’s 2-4-1 international premium airfare deal.  This one is so fraught with caveats that it is almost never a good deal.  You have to pay pretty much the highest fare available but inventory for cheaper fares needs to be available, and those discount fares can often be half of the top fare.  The carriers and destinations are limited.  And the free ticket collects no points.  Still, every now and then there were deals to be found.  Those diamonds in the rough are going to be harder to find if the rumors of airlines departing the program are true.  It seems that Continental, Delta and Emirates are all departing the program.

There are a few new hotels joining the Fine Hotels & Resorts program, but that really only benefits folks spending a lot of money on hotel rooms, of which I am not one.  I might be getting rid of the card when it comes up for renewal this year after carrying it for about 5 years.  The value is disappearing pretty rapidly for me.

Hit-and-run tourism

Posted by Seth on August 5, 2008 under Uncategorized | 2 Comments to Read

I was reading one of Lucky’s posts over at One Mile at a Time and started thinking about the concept of the “3 Perfect Days” series from United. The few times I’ve flown on United I’ve actually looked forward to reading those articles, and in a few instances they actually were about places I was head on that trip or an upcoming one. Considering how infrequently I fly UA I found that pretty coincidental.

Lucky’s post got me thinking about the fact that I’m a hit-and-run tourist. No, I don’t go around crashing cars into pedestrians (though I do have a spotty driving record overseas). But when I head out to see a place, spending more than two or three nights in one place seems strange to me. I actually had only one limitation put on my honeymoon itinerary planning – no single night cities. I managed to plan it that way (for the most part) and we had a great trip, but I still like the shorter stays and getting to see more places.

Could we have spent more time in Bangkok? Maybe. But I don’t think that we would have enjoyed our additional time more than the initial three nights there. Ditto for our two nights in Paris. Though I’m sure we could’ve continued to eat the great food, the other aspects of the touristing there weren’t so great. And I actually felt that more than one night in Venice was too much, each of the three times I’ve been there, so there are times the hit-and-run approach makes sense.

I’ve also been to plenty of places that I want to go back to, where the 2-3 nights isn’t enough. But even for those places I’m not sure I’d stay too much longer on subsequent visits. I like getting my exposure to the places a little bit at a time, and circling back later to see more. Of course, you run the risk of circling back later to find out that the sight you wanted to spend more time at is gone, but I look at those situations as an opportunity to find something new to see.

And there are certainly plenty of new (to me) things to see out there in the world.