View from the Wing

Quick quiz: What does TSA stand for?

• (T)aking (S)cissors (A)way
  
• (T)housands (S)tanding (A)round
  
• (T)ourism (S)uppression (A)gency

Before deciding, please consider that

The Department of Homeland Security is drafting a rule that will require airlines to pass on passenger manifest information as much as an hour before the departure of international flights bound for the United States

Requiring information to be submitted an hour before flight takeoff involves a full 75 minutes greater notice than currently provided. This will mean passengers turning up at the airport at least an additional hour in advance of flight time. Multiplied across all the passengers each day, that’s millions of lost productivity hours each year.

The problem compounds itself for connecting flights. It’s as yet unclear whether a passenger will have to have arrived at a connecting airport before the list is compiled, to prevent the list from including incorrect information driven by misconnecting passengers. If so, connecting flight time will need to be increased as well — playing havoc with airline schedules and wasting more passenger time.

And since the rule is intended to apply not just to passengers bound for the U.S. as their ultimate destination, but also to passengers transiting the U.S. on their way to other destinations, the rule will disadvantage U.S. carriers competing for passenger dollars. Foreign carriers, whose hubs are in countries without the requirement, will be far more consumer friendly for such customers.

Perhaps this would be a worthwhile, though massively costly, investment if it were in any way likely to reduce loss of life from terrorism. But the additional travel time required by the rule will simply be in service of blindly reject people whose names are for whatever reason on a master list. Terrorists, meanwhile, can simply fly under assumed identities.

Just last week Independence Air said that its fourth quarter results would be ’slightly better’ than the $82.7 million that it lost in the fourth quarter. I was skeptical, pointing out that the emphasis would no doubt be placed on ’slightly’. Turns out that the results were worse: a fourth quarter loss of $86 million — and they’re still figuring out the accounting, so this may change.

Meanwhile, United lost $326 million in January. After two years of bankruptcy protection they still haven’t figured out a viable business model.

It seems the only ones making money on the airline are the consultants

UAL’s professional payments alone totaled more than $13 million in January, including $1.4 million to consulting firm KPMG LLP; $2.4 million to Kirkland & Ellis LLP, the law firm that serves as United’s lead counsel; and nearly $5.7 million to management consulting firm McKinsey & Co.

Of course that isn’t quite true. JP Morgan Chase - which recently acquired BankOne - does quite well with its United Visa product.

It’s clear why United is being propped up by J. P. Morgan Chase, whose merger partner provided half a billion dollars in debtor-in-possession financing at the time of the airline’s chapter 11 financing and who now is letting United slide on terms of the financing — the continued survival of the carrier was necessary to maintain the bank’s profitable credit card business.

But for some inexplicable reason, Citibank, CIT Group and GE Capital are going along with similar terms and United has apparently received contingent offers for $2 billion to $2.5 billion in exit financing.

I have long recommended the Diners Club credit card because, despite limited acceptance and a hefty annual fee, the benefits were really unparalleled: an outstanding rewards program, two full billing cycles to pay, free iDine Prime membership, concierge services, and primary rental car insurance.

Needless to say, the anticipated linkup between Diners Club and Mastercard had me very excited. If my Diners Club card would get accepted everywhere that takes Mastercard, it would rise to a spot as my #2 credit card (behind the Starwood Amex). However, I’ve been nervous. I assume that the linkup with Mastercard would mean lower interchange fees for Citibank, which issues Diners Club in North America. And with lower fees I imagined cost-cutting from the benefits budget. Diners Club has assured the contrary.

I received an information packet in the mail last week, preparing me for the changeover which is anticipated in about three more months.

Lo and behold, the two billing cycles to pay benefit will be gone. There’s also an increase in the foreign currency conversion fee to 3%. And while a Diners Club rep tells me that the rental car insurance benefit isn’t going away, there’s a troubling statement in the brochure about a possible change in insurance carrier. I’m nervous about that benefit.

I’m more than a little peeved because I just re-upped with my annual fee this month. I’ll still keep the card and use it as my primary backup for merchants that don’t accept American Express as long as they keep the rental car insurance. But if that benefit goes away I’m not paying a $95 annual fee for a Mastercard with a versatile rewards program (that charges a fee for converting points into miles).

One other minor change to note: Instead of earning 2 Diners Club Rewards points per dollar spent, earning will change to 1 point — but Diners Club assures that the number of points required for redemptions will drop in half, so that awards will not become more expensive. Existing Club Rewards balances will be cut by 50% as well as part of this change.

Instapundit calls Amazon’s offer of an new annual fee for free two-day shipping on all your orders a frequent flyer program.

Heh. Too bad the only shopping rewards program Amazon participates in is the Dividend Miles Mall.

Through February 28 Frontier Airlines is giving all new accounts 1500 miles just for signing up.

If you have a Points.com PointsPlus account (which you can get free) you can immediately transfer these 1500 miles into 675 eBay points, 349 American miles, 750 Asia Miles, 2250 Goldpoints, or one of several other choices.

Marriott is offering 2500 bonus points for each of the second through fifth stays between March 1 and June 1. Registration is required by May 15.

Flyertalk welcomes a new blog, My Point by Joe Turner.

Looks like posting has been going on for a couple weeks, though I just noticed it. Readers of this blog will probably enjoy that one.

It’s also worth a mention that David Rowell has a new blog as well.

Chris Elliott has a piece in US News on hotels assigning their worst rooms to customers booking through discount channels.

This absolutely happens at some properties, though I’ve never experienced it personally through scores of successful bids.

The best advice is that discount sites aren’t the right venue when room selection really matters. If you can afford a nice hotel with an ocean view on your vacation, Priceline may not be the right answer given the risk of being assigned a garden view. You might want to pay to actually reserve the ocean view room. On the other hand, if money is an issue then a “Priceline room” at a four star property may be better than a regularly-reserved room at the two star property you’d have otherwise booked.

Meanwhile, if you do go the discount route and are unhappy with your room, as to be changed. And if the first person says no, ask someone else.

Chris Elliott offers some further advice but I’m not sure what to make of it:

Analysts say the discounts–as much as 40 percent to 60 percent on sites like Priceline and Hotwire–make the travel websites worthwhile. But, if you can, check with the hotel to learn what kind of room you get for that rate. Earning frequent-stayer status also can help your room assignment.

Check with the hotel about the room you’ll get, before booking on Priceline or Hotwire where you’re explicitly not even supposed to know what hotel it is you’ll be getting?

I know as well as anyone that sites like Biddingfortravel.com and Betterbidding.com will help give you an idea what you’ll be getting in advance. But even then many zones and quality levels have plenty of hotels you might get, and there can always wind up being new previously unreported hotels as well. So I’m not sure how calling a hotel upfront before booking a nonrefunable room is a useful option here.

And while some hotels might still honor elite status even on a Priceline stay, several chains like Starwood and Hilton explicitly state that elite status does not provide benefits on stays booked through these channels. Hyatt and Marriott are generally better in this regard.

The ultimate point is simply that Priceline and to a lesser extent Hotwire are outstanding tools but they are not universal silver bullets for all occasions.

Gratis Networks has a new free electronics offer (yes, another one!). This time it’s Free Playstation Portables.

I’ve gotten the free iPod, the photo iPod, the desktop computer, the game system, the flatscreen TV, and the handbag. The Mac Mini has been shipped. Alas, I still have to wait for my free iPod shuffle — hasn’t shipped yet, and I want it. I’m not the most patient person in the world…

It’s worth noting that these free offers probably mean a bunch of spam. If so, it all goes to my junkmail folder, but I assume that Gratis markets their customer lists. Their privacy standards have been roundly criticized. It seems a small price to pay for the great payoff in free electronics. I’d rather “sell” my information that way than give it away for free, which I’m usually asked to do. But some folks will find reason for concern in this.

I flew a couple transcon flights on Alaska Airlines. The first, a breakfast flight, was very disappointing. The first class flight attendant spent the majority of the flight in the galley reading. She had a sour demeanor, and made requests unpleasant. Breakfast was sparse. The return flight was a different story entirely, a much more pleasant crew and a filling lunch. Still, the pitch is tight on Alaska’s first class product and the seats are old and visibly worn.

Security lines were long at both Reagan National and Seattle. Not surprising, it was a holiday weekend. The first class/elite lines in Seattle make a huge difference. It’s a shame that National doesn’t offer this (and neither, unfortunately, does Dulles). Seattle is the original home of shoe removal. It’s commonplace nowadays, but it seemed to start there. The TSA attitude at that airport always seems to bother me a little bit more than elsewhere. I don’t have anything firm to rely on here, just my own gut sense. My blood boiled as I heard a screener explain to a woman that she doesn’t have to remove her shoes to go through security. But if she doesn’t she’ll be selected for extra screening, which will require that she remove her shoes.

I’m a terrible hotel geek. I stayed at the Sheraton Seattle, really just because I’ve stayed at the other two Starwood properties in town and I wanted to have sampled them all. I love the W, and I like the Westin (though my feelings on it are tempered somewhat by its size, confusion, the length of time it takes to get a car from the valet there, and generally getting the little things wrong).

I wanted to like the Sheraton. I really did. But they were consistently understaffed while I was there. Fortunately the line was only six deep while I was checking in (and most of those behind me). The lines got far worse over the weekend, as a Starbucks convention checked in. I’d guess 90% of the hotel turned over around the same time, but there were never more than two people at the desk and the checkin line wrapped around the whole hotel. A makeshift baggage camp was set up in the lobby.

I was pleased with the room itself. I had a view of the water which I did not expect (it was not a direct view, but still a nice one). The bed was comfortable, though the pillows were pretty worn out. The door to the room was dented at the bottom.

Getting ready in the morning the plastic covering on one of the lights in the bathroom fell down and shattered in front of me. I couldn’t speak to anyone at the desk — they were too busy — so I told the concierge who made sure maintenance went up during the day while I was gone. I had a voicemail when I returned promising 2500 points for the trouble. I was struck by how much I appreciated the Sheraton Service Promise gesture, since I didn’t ask for anything at all. I was a whole lot more tolerant of other problems as a result, even though I wasn’t being compensated for those (and didn’t ask).

Billing was majorly screwed up on the stay. I had a car but was charged for two cars on two nights. After waiting in the long line at the desk to resolve it in person, only one of the two nights was fixed. Back to the line the next morning!

24 hours of internet is supposed to be $9.95. But every time I tried to buy that, the screen informed me that my 24 hours of internet would last until X time, which was invariably 4-6 hours in the future. So I kept buying the 30 minutes for $4.95 option.

On the other hand, there were also billing errors in my favor that — no matter how hard I tried — I couldn’t get the desk to understand. I gave up and wasn’t going to fight the long lines, blowing the rest of my long weekend, in order to find a way to give them money that was due to them that they weren’t asking for. I’ve since seen some of the correct charges show up on my credit card. Great, the money is due them, but a corrected statement or a phone call would be nice.

Had room service on two occasions. The menu is quite limited.

Public spaces are nice. Room itself was nice. The place was just disorganized over the weekend and had a hard time providing service because there simply weren’t enough people on staff to meet the needs of all the guests.

Keith Alexander, whose Washington Post columns I generally quite like, this week reviews the recent history of customer activism and their successes in changing the policies of travel providers.

Last week, numerous complaints prompted Hertz to back off a plan to introduce a $2.50 reservation fee on all of its vehicle rentals in the United States.

…

Hertz acted on the reservation fee after several large clients organized an e-mail campaign and other regular customers posted a “boycott Hertz” message on FlyerTalk.com, a popular Internet message board made up of some of the nation’s most frequent — and influential — travelers.

…

In 2002, Delta’s frequent fliers were outraged when the airline reduced mileage awards on steeply discounted tickets. They created a Web site called SaveSkyMiles.com and raised money to send a truck-mounted billboard protesting the change to a Delta annual meeting. Delta reversed the decision in December 2004. Now, passengers on cheap tickets get a full point instead of a half for every mile.

…

US Airways frequent fliers mounted a campaign against a 2002 decision to void the value of an unused ticket instead of applying it to a future trip. Passengers — calling themselves cockroaches — organized via the Internet, began holding regular meetings and sent e-mails to US Airways managers denouncing the policy. Nearly a year later, US Airways backed off the plan.

Companies ignore their customers at their own peril.

Chris Elliott writes in the New York Times that miles are taking longer than ever to post to frequent flyer accounts.

That hasn’t been my experience, at least as a general rule. Airlines are getting better at tracking miles for flights. If a frequent flyer number is entered into a reservation in advance, it’s pretty much a certainty that the miles will post. Problems come in when airport agents load the numbers incorrectly, and at times when trying to credit miles to a partner airline’s program.

Delta, flagged by the article as second-worst for posting miles, actually credits member accounts before their flights even lands. Delta’s technology in this area is unmatched.

The real problem comes in with mileage earning partners. As the article observes, rental car companies are notorious for lags and gaps in posting miles. And the sheer volume of partners compared to past years ensures that there will be more posting problems than ever before simply because there are more vendors each separately submitting miles and the posting process becomes infinitely more complex.

Some other vendors are notoriously bad at posting points. Sometimes transactions fall between the cracks. It happens all the time. I’ve personally had real difficulties over time with Goldpoints. There I believe the problem is incompetence rather than ill intentions.

Some other partners offer miles and then seem to make it difficult to claim those miles on purpose, since posting of miles costs them money.

I keep an Excel spreadsheet with the miles I expect to have posted. I log the transaction date, the vendor, what the miles are for, the program, and when I expect the miles to post. I also keep tracking numbers or other information in it as well. And I regularly review the spreadsheet for missing miles, and I follow up mercilessly.

Perhaps my biggest pet peeve is the “6 to 8 weeks” that miles take to post. Or more accurately, that they take not to post. Many vendors post miles right away, in days, but refuse to talk to you until 8 weeks have passed. Then there are the vendors who say 8 to 10 weeks. And the ever offensive rule with American Express bonuses, “12 to 14 weeks.” And in that last case, they really wait until the last minute to post the points. Many travelers forget what the miles were for when they post, if they post. And if they don’t, it’s been so long most members forget. There’s really no excuse.

USAirways says it needs $250 million to emerge from Chapter 11 bankruptcy, which strikes me as too low.

Air Wisconsin has proposed investing $125 million. Air Wisconsin operates primarily as a regional feeder for United.

USAirways has been extremely successful reducing its labor costs, but it remains unclear how their business model can return them to profitability. Still, any indication of interest in providing exit financing is a strong positive sign for the airline.

Meanwhile, Independence Air says that it has successfully renegotiated its aircraft leases.

After almost four months of negotiations, Flyi said it will be allowed to terminate leases on 24 of its regional jets — about one-third of its fleet. Those concessions will help cut its aircraft lease payments by $94.5 million over the next two years. Creditors are also allowing the company to defer another $70 million in lease payments over the same period. Flyi also said it was given a five-year, $16.1 million loan from GE Capital Aviation Services Inc. In exchange for the concessions from its creditors, which Flyi did not name, the airline agreed to issue them about 8.3 million shares of stock.

Still, things are far from rosy. They recently had an aircraft repossessed. One of the commenters on this website claims their phones were turned off briefly at Tampa for failure to pay the bill. They’re going to announce fourth quarter earnings shortly and all they can say is that results were “slightly better” than the $82.7 million they lost in the third quarter. So it remains to be seen whether they can make their business model work. But bankruptcy may have been put off for awhile.

Arguments over the Wright and Shelby Amendments restricting flights out of Dallas-Love Field are reaching absurd proportions.

For years Southwest, which is based at Love Field, has maintained official neutrality to the federal rules which limit flying out of the airport to contiguous states. It took years of litigation for Southwest to even be able to use the airport, which had otherwise been abandoned for the Dallas-Fort Worth facility.

I’ve assumed that Southwest’s newfound desire to overturn these restrictions is mostly a matter of posturing. I don’t think Southwest really wants substantial new flying out of Dallas.

There’s not much room for expansion out of Love Field. They’re pretty close to maxed out in their existing terminal space. New flights to further away destinations could certainly displace existing flights, and those might well be more profitable than certain existing services. But I have a hard time imagining that greater focus on Dallas is the next best expansion opportunity for Southwest.

In order to expand Love Field they’ll have a whole separate battle with the city over space, possibly years in the making, and they’ll have to bear 100% of the cost.

If they actually wanted more Dallas flying, it seems to me that they would have placed a higher priority on picking up the Delta gates at DFW with free rent and $22 million in incentives. The fact that they didn’t suggests to me that they don’t view Dallas expansion as a high priority and are simply posturing about expansion at Love Field hoping to scare away expansion by potential low cost competitors who might be interested in those DFW gates.

That said, Southwest expansion beyond the limits of the Wright and Shelby amendments scares the bejeesus out of American which is based at DFW.

American predicts doom and the end of the world in the event these laws are repealed, and suggests that they would have to build a hub at Love Field in order to fight back “because that’s where the customers are going to want to go.” But that seems to me to be an argument for repealing the laws — customers would benefit from added convenience — rather than an argument against repeal!

And American is bluffing in any case. They have three gates at Love that are going unused. They’ve been completely chased out of the airport due to low fares and an inability to fill their planes.

Gary Steiger has returned from vacation and updated his comprehensive and indispensable Free Frequent Flyer Miles website. It contains links to a plethora of credit card, telephone, internet service, mortgage, and other bonus offers. I often use it as a reference myself — Gary Steiger catalogues the offers, so I don’t need to save them all when I want to refer someone to the best possible bonus.

Test drive a Buick through February 22 and get $100 towards a two-night Marriott stay.

Uncharacteristically, I don’t plan to be online during my travels for the next few days. See you all Tuesday.

Been pretty busy and my limited posting prevented me from mentioning a story that Notiflyer broke last week:

Hilton HHonors has introduced a rolling elite-qualification program.



HHonors now allows members to carry over stays from the prior calendar year in order to achieve HHonors VIP status. By comparison, most other programs only allow members to count stays in a calendar year (January through December) to count toward elite status.

Yesterday’s Joe Sharkey column in the New York Times contained a couple of interesting tidbits.

First, according to an American Express survey

[M]ore than a third [of respondents] believe it is either “somewhat” or “quite” common for business travelers to submit expense accounts with “one or more completely false or bogus charges.”

This does not surprise me in the least. Taxicab receipts are usually provided blank to travelers. Other receipts are easy to fudge. And travelers find it easy to justify ‘a little extra’ in their expense report as compensation for long days and time away from home. When oversight is poor, and there’s the expectation of insufficient scrutiny, even the best and most honest travelers may fudge. I see it every day. (One small part of my job is making sure it doesn’t happen where I work.)

Sharkey also points to a change in the way that Continental processes upgrades. I’ve been meaning to blog about this for weeks, since I first heard about the change, because it’s significant.

Effective March 16, Continental said, priority for upgrades will be given to OnePass elite members traveling on full economy fares, based on elite status and time of check-in. Next in line will be those traveling on fares less than full economy, with priority based on elite level, then fare paid, and then time of check-in. The policy for companion travelers accompanying Platinum Elite members also is changing. Companion upgrades will be sorted by the status level of the elite member and by the time of check-in. For instance, Continental said in an e-mail message to its elite members, passengers accompanying a Platinum Elite member will be upgraded only after all other Platinum Elite members have received upgrades.

Instead of considering elite status first for at-the-airport upgrades (also known as “battlefield promotions”), Continental will first look at fare paid on the day of travel. A full fare Silver elite will trump a discount Platinum. Continental is moving towards rewarding individual pieces of revenue rather than loyalty and revenue stream. This is a huge shift.

It seems strange to me, though, because even as Delta backslid and restored full elite qualifying miles on reduced fares, Continental has held on. That means that in order to earn Platinum status, a passenger must be buying tickets with a high fare basis or traveling nearly twice as much (or buying all tickets on the Continental website, which still produces an exemption from the punitive elite qualifying miles scheme). So you’d think those high revenue platinums would get recognized regardless of the fare they’re paying on any particular day. A platinum who buys full fare tickets on business and discount fares on the occasional leisure trip gets penalized under this change.

Companion upgrades will also receive a lower priority at the airport, so that leisure trip with a spouse by the full fare business traveler gets even tougher. Good news for other elites, but a dimunition of platinum.

Starwood is offering 25% off the points cost of award nights at several hotels in Southeast Asia for stays through the end of May.

While Starwood seems to offer such discounts across the board for about a week during the summer, they don’t seem to often offer promotions like this: discounts at properties during their slow seasons.

Of course, Starwood offers cash and points awards and properties that participate are usually facing their slow seasons. But it’s rare that they offer similar discounts on all-points awards. Good move, Starwood!