Category: Cranky Flier CF

3 Links I Love: Interviewing United Execs, Ram…

3 Links I Love: Interviewing United Execs, Ramping Up Against Gulf Carriers, Sun Country Look Back:

Tomorrow is Dorkfest!  Hope to see some of you at In-N-Out by LAX between 11 and 1p…

This week’s featured link:
How United’s Working to Right the Ship: An Interview With UA LeadersThe Points Guy
Chris Sloan did an interview with United COO Greg Hart and CCO Andrew Nocella.  It’s a long read and worthwhile, but I found it interesting that some of the comments made seem to go against what Scott Kirby told me and others at Boyd this year.  In particular, the COO says the airline is investing in the Dulles facility while Scott Kirby sounded like that wasn’t the case.

Two for the road:
American CEO on Gulf Carrier Pact: ‘Someone Is Cheating Already’ – Skift
I listened to the A4A summit and heard the whole interview with Doug Parker.  As Skift points out, there’s already some talk about whether the Gulf Carriers aren’t holding up their end of the bargain on the recent agreement between the US and UAE.  Of course, the agreement itself was entirely nebulous and nothing is really being broken here, but it sounds like it might be time for rhetoric to start up again.

Former Sun Country owner learned a lesson: ‘Don’t fly under the radar’ – Minneapolis StarTribune
A few interesting nuggets as the former owners talk about owning Sun Country.

September 21, 2018 at 01:45PM Source:

Fee Regulation: Congress Should Give Up and Ai…

Fee Regulation: Congress Should Give Up and Airlines Should Shut Up:

Fall must nearly be here.  The air is crisp, leaves are changing colors, and Congress is trying to regulate airline fees.  It’s a time-honored tradition, and one so dependable that I was able to reuse the image below from a previous post.  Even some of those faces are the same.

As usual, I think this latest plan is a bad one, but I also wish American would stop throwing around threats about what will happen if this comes to fruition.  It’s not helping.

The plan this time (aka Fee Regulation Act #3,958) comes from the Senate.  The idea is to regulate the level of fees that can be charged by airlines.  Specifically, it’s in section 3129 of the Senate FAA re-authorization bill.

…the Secretary of Transportation shall prescribe regulations–
(1) prohibiting an air carrier from imposing fees described in subsection (b)(1) that are unreasonable or disproportional to the costs incurred by the air carrier; and
(2) establishing standards for assessing whether fees described in subsection (b) are reasonable and proportional to the costs incurred by the air carrier.

The fees in question are those for changes, cancellations, checked bags, seat selection, same day change or standby… and “any other fee.”  So, yeah, it’s broad.  Even though the Senate is telling the DOT to figure out how to do it, it’s not leaving much to chance.  The guidelines demonstrating exactly what needs to be considered in determining the costs involved are quite detailed.

This idea is, to put it bluntly, stupid.  In what industry are the players forced to price based upon costs?  You think your iPhone is sold as a reasonable mark-up over the cost of sweatshop labor in Asia?  No, it’s priced based on what the market will bear.  That’s the foundation of a free market.

There must be limits to this, of course.  That’s why we have rules around things like monopoly pricing power and gouging.  It’s hard to define that in the airline industry and previous cases have often resulted in no action, but an attempt to define and regulate that wouldn’t be objectionable.  That is absolutely not what’s happening in this proposal.

Why is this bad?  Well, let’s look at change fees, for example.  I find the standard $200 change fee obnoxiously high.  We can argue whether there’s collusion on that or not and whether it should be challenged.  But the proposal here would require airlines to charge change fees based solely on:

  • The net benefit to the airline after considering the ability to anticipate expected cancellations and changes, ability to fill a seat after someone changes off a flight, the difference in fare paid for a ticket sold to fill that seat vs the original value, and the likelihood that the changing passenger will fill another seat on another flight
  • The costs of processing the change electronically
  • Any related labor costs

This is completely ridiculous.  So the airline will have to build some sort of interactive model that updates in real-time to determine the valid change fee? Or do you just have to take a random average over time throughout the network and then apply that number across the board?  Neither solution makes sense.

Fortunately, this probably won’t happen.  Last I checked, the House version didn’t have this in it, and I assume it will quietly disappear if there’s ever a final bill.  Considering how bad Congress is at putting together any FAA re-authorization, it remains to be seen if we’ll see any bill pass at all.

But let’s pretend it does happen.  Then what?  Well, unless the airlines can magically make their models reflect the existing change fee as being valid, fees are going to have to go down.  Hooray, victory for consumers, right?  Of course not.

This can go a couple of ways.  Airlines need to make a healthy profit.  Fares are low on a historical level, but much of that is true because of all these optional fees that have sprung up in the last decade.  Change fees alone are big business.  In the first half of this year, DOT-reporting airlines took in more than $1.3 billion in change fees alone.  American had the most with $450 million.

If these fees get cut in half, do you think American is going to just say “aw shucks, that’s a bummer”?  Of course it won’t.  American has decided to speak out about its plans.  CEO Doug Parker told a group in Texas this week that it would consider eliminating the ability to change tickets at all if this were to happen.  That may sound like a valid threat, but to me it rings hollow.  When Doug used to talk about the 3-hour tarmac delay rule, he used to say that the airlines brought it upon themselves by having so many bad incidents.  This is the same situation.  If American opted to retaliate against bad legislation by banning changes, then it would find itself facing worse legislation due to its actions.  I wish American wouldn’t say stuff like this, because it just makes people angry at the airline.

What’s more likely is that fares would rise.  The airlines want to maintain healthy margins.  If fee revenue drops significantly, then they have to pick it up elsewhere.  With fees regulated across the board, the only place to gain is via increased fares.  It’s just moving the money around, but it will likely result in reduced service.  If fares have to go up, demand will go down.

This whole thing is a bad idea, but American isn’t helping things by speaking about it.  Just work the halls of Congress and let it die the quiet death it deserves.

September 20, 2018 at 01:45PM Source:

3 Links I Love: Sabre Warms to NDC, OneJet and…

3 Links I Love: Sabre Warms to NDC, OneJet and WOW Air Face Trouble:

This week’s featured link:
Sabre Agrees to Pilot New Technologies With American Airlines and Other Travel GiantsSkift
Distribution-giant Sabre spent a long, long time fighting against the use of NDC to modernize airline distribution, but under Sean Menke, the company has finally lurched forward and joined the party. That’s a good thing, because it would have been left behind if it continued down its previous self-destructive path. This announcement shows Sabre partnering with the right people to try to make the changes that airlines and agencies have pushed for time and time again. Considering the company’s track record, I won’t believe this until I see it, but for the first time I’m cautiously optimistic. Sabre is a tough company to change, but it feels like there’s progress being made for the better.

Two for the road:
Pittsburgh sues OneJet for $763k+ due to contract breachch-aviation
It looks like OneJet’s plan to take advantage of generous airport/city support has run into a snag. OneJet pulled out of most of its Pittsburgh markets (or didn’t start them) before it was allowed to, and now Pittsburgh wants its money back. It gets worse, yesterday the acquisition of Ultimate Jetcharters fell through. This isn’t sounding good at all.

WOW Air seeks investorsiceland monitor
WOW is private, so we don’t know much about its performance… until now. It’s losing money, unsurprisingly, and it needs to raise more. What I’d like to know is whether it makes money during the summer and then loses it all in the winter OR if it just doesn’t make money at any time. It’s hard to know if there’s a sustainable airline buried in there or not without seeing more detail.

August 17, 2018 at 01:45PM Source:

If You Think Fares Are Confusing for Travelers…

If You Think Fares Are Confusing for Travelers, What About the Poor Pricing Analyst?:

When I first came out of college in 1999, I started work as an analyst in pricing & tariffs for America West Airlines. I realize I sound like an old man when I say this, but back then it was a simpler time. When I left in 2002 to go to grad school, the industry had changed but pricing really hadn’t. A la carte pricing had yet to take hold, and the fare was still pretty much all people paid to travel. Since then, of course, things have changed rapidly. While it is obviously hard for travelers to keep up with these changes, I hadn’t even thought about how it would be for those doing my old job. A press release about a patent that ATPCO just received got me thinking.

ATPCO is the airline-owned Airline Tariff Publishing Company. For decades, ATPCO has been the clearinghouse for airline fares and rules. Airlines would file everything with ATPCO, and then it would compile and distribute that information to travel agents, distribution systems, other airlines, etc. As a one-stop shop, it just made it easy to propagate changes to everyone who was selling tickets. Now I know I acted like times were simpler back then, but they were never really simple. When fares combined with rules, airlines could put last ticketing dates, restrict travel dates, pick only certain days/times where a fare was valid, limit availability to specific flights or combinations of flights with other airlines, add seasonal restrictions, apply surcharges, require an advance purchase, apply minimum and maximum stays, use blackout dates, and restrict by routing. There was a lot in there, but when it came to the consumer making a decision, the only real difference within any single cabin was whether the fares were refundable or not. The rest of the product was the same.

Now, different fares bring very different product offerings with them. To make some sense of this, airlines have organized fares into various fare families, but these aren’t standardized. It can be very difficult to compare apples to apples. Consumer-facing websites have done a truly lousy job of displaying product differences between fares, though there has been some effort to fix that. I just wrote about how American was adding a carry-on bag back to the Basic Economy fare, because Google Flights put a simple filter that allowed consumers to request only fares that included a carry-on in the price. When people selected that, American was not competitive with Delta, an airline which includes a carry-on in its Basic Economy fare. That seemingly simple ability to categorize fares into what people want has materially impacted American’s ability to make money, and so American had to change its product to align with the market. But now think about it from a pricing analyst perspective.

I looked up fares from LA to Frankfurt in November and found far more than 650 different fares filed. (It caps at 650 unless you narrow it down further, and the 650th fare was still a low coach fare for under $2,000 roundtrip.) Just look at the dizzying array of fare families from some of the European carriers:

  • Aeroflot – Economy Saver, Economy Classic, Economy Flex
  • Air France/KLM – Economy Standard, Economy Standard Plus, Economy Full Flex
  • Alitalia – Economy Classic, Economy Flex
  • British Airways – Basic Economy, Standard Economy, Economy Fully Flex
  • Finnair – Light, Standard, Flexible
  • Iberia – Basic, Optima, Flexible
  • Lufthansa – Without Bag, Including Bag
  • SAS – SAS Go Saver, SAS Go, SAS Go Flex
  • TAP Air Portugal – Basic, Classic, Plus

How the heck is an analyst supposed to keep this straight? Airlines do use sophisticated tools to analyze pricing in the marketplace. Some airlines have developed their own tools while others purchase them off the shelf. Presumably some are better than others (it’s been years since I’ve looked at one), but there’s always room for improvement. This, apparently, is the focus of this patent from ATPCO. The press release is fairly vague, but I did have the chance to speak with John Murphy, VP of Technology, Navid Abbassi, Chief Architect, and David Peart, R&D Innovation Architect so I could try to wrap my head around what they’re doing.

So far there aren’t a ton of tools that are out there using this patented technology, but ATPCO has started to develop some. Here’s a look at the Total Price Comparison tool which is the most interesting so far.

This looks at the lowest fare by airline in each market over time, and it includes all surcharges and taxes. Presumably this will also have the ability to do it by fare attribute (carry-on bag, etc) over time. The idea behind the patent is that it can deconstruct and compare fares to each other in real-time based upon the attributes.

ATPCO isn’t interested in this patent just so it can sell some tools, however. This is really a play by ATPCO to remain relevant any way it can. The base functionality of ATPCO as a fare and rule aggregator is a relic from another time. That’s not to say the function isn’t useful, but there’s so much technology today to allow disintermediation that ATPCO has to find a way to stay in the game. It is planning on not only developing its own tools using this technology but also allowing others to develop off this.

I know what you’re saying… “this makes it easier for a pricing analyst, but what the heck do I care?” Well, if pricing analysts can get better information and get a true sense of the dynamics of the market in real time, it should allow them to keep their airline more competitive with others. That doesn’t guarantee fares will come down, but increased competition usually pushes things in that direction.

August 16, 2018 at 01:45PM Source:

The Grave Threat Posed by Aircraft Thieves (or…

The Grave Threat Posed by Aircraft Thieves (or Not):

When I first heard that a non-pilot had stolen a Horizon Air Dash-8 Q400 and flew around Seattle for an hour, I couldn’t help but be impressed. How could someone who doesn’t have a license to fly figure out how to choreograph that entire event? If you haven’t seen the video, it’s stunning to watch what he did.

It appears that my reaction was not the norm. Judging from the stories I’ve seen and emails I’ve read, many people went into panic mode. This was a national security threat and major changes needed to be made yesterday or we’d face the grave threat of stolen airplanes dive-bombing all over the land! While I don’t doubt that changes could benefit aircraft safety (as is always the case), I just have a hard time seeing this as the huge threat others do.

I think Patrick Smith sums up my view fairly well. Once you start thinking about who could actually pull off something like this, you start to understand that it’s not as big of a threat as some might think. Think about it this way…

  • You would need access to a secure area of the airport where passengers can’t go. That means you would need to have a SIDA (Secure Identification Display Area) badge issued by the airport. This eliminates anyone except employees who frequent an airport enough to have been badged at that location specifically. (Here we had a guy who worked for Horizon in Seattle so he had access.)
  • The aircraft would need to be in a location where you could easily evade security and other employees. You would also need to be able to avoid other aircraft traffic. (Here the airplane was at the far north end in a maintenance/cargo area that was right near the edge of the runway for easy access.)
  • You would need to know how to start up the airplane, taxi it, and then fly it. (Here was a guy who was trained to tow aircraft, so he had better knowledge than most. The rest he figured out possibly through video games, though I’m not sure we know for sure.)
  • If you were looking to do damage to people or landmarks as a terrorist might, you would have to have even better flying skills to actually reach your target.

When you think about it this way, the question becomes… could additional security measures help all that much? I’ve seen some shocked to find that airplanes don’t have “keys” that prevent unauthorized access. But that’s proven to be mostly unnecessary because of just how hard it would be for anyone to actually do anything with that airplane if he or she snuck onboard. Of course, this Horizon crash shows that under the right circumstances someone can still pull this off, but it’s exceedingly rare that all the stars align to allow it to happen.

The biggest concern in the news is that a terrorist would sign on with an airline or contractor, go through extensive background checks, get a SIDA badge, learn not only to fly but also to taxi and takeoff, find an aircraft parked in a convenient spot, and then execute the plan to kill a bunch of people on the ground or bring down a landmark. The chances of that happening are incredibly minute for all the reasons already discussed. There are plenty of security checks in place along the way to make this truly unlikely. That’s not to say it can’t happen, but it would take a great deal more coordination and work than what happened on 9/11 — bringing some legal box-cutters on to a mostly-empty airplane and hijacking it once in flight.

Perhaps the biggest concern here shouldn’t be terrorism but rather the mental health of people who have access to these areas. It’s the same thing I wrote about in 2015 when that Germanwings pilot crashed his airplane into a mountain and killed everyone onboard. I’d like to put my faith in the background checks as being adequate, but that doesn’t help when it comes to evaluating ongoing mental health issues over time. If there’s one takeaway for me after this, it’s that we need to pay more attention to mental health and well-being in this country, especially at a time when rates appear to be rising. This isn’t news, and this particular incident doesn’t really change anything. It just shines more light on the problem.

Adding additional security to aircraft? Sure, it could be useful to prevent the one-in-a-million chance of something sinister occurring, but it’s hard to imagine that being worth the cost. Still, fear-mongering is easy and it unfortunately gets clicks. I can only hope there’s no knee-jerk reaction to this.

August 14, 2018 at 01:45PM Source:

Tokyo Hub? Who Needs a Tokyo Hub?

Tokyo Hub? Who Needs a Tokyo Hub?:

For many years, Delta seemed like an airline in search of an Asia strategy while its competitors pushed forward definitively. Now that the Korean Air joint venture is in place, however, the combined Delta/Korean efforts looks like an airline on a mission. They have plowed forward, most recently with a new Boston-Seoul flight that Korean will operate. Long having the weakest relationships in Asia, Delta is quickly working toward building the best of the big three, but this isn’t just a story about Delta. It’s also about Korean Air, Incheon’s amazing airport, and Tokyo’s problems.

Go back a few years, and Delta’s Asian strategy was basically Northwest’s old strategy. It served markets that it could fly nonstop from the US, but the real strategy focused on connecting people via its Tokyo hub. That proved unsuccessful in a changing world and Delta didn’t wait long before dismantling it. The Tokyo hub shrunk quickly as Delta moved to make Seattle a hub and Asian gateway, but a long-running rift between Delta and its obvious partner Korean Air left the airline without a major Asian option. That gave United and American a real opportunity.

United, of course, had the strongest position in Asia. It previously had a Tokyo hub as well, but more importantly, it had San Francisco, the best Asian gateway from the US. The Tokyo hub shrank down to nothing on the back of that San Francisco hub as well as the joint venture with ANA. Why would United need to fly beyond Tokyo when it could use its partner ANA to do the heavy-lifting? American had virtually nothing in Asia, so it decided that it would build up Los Angeles as its gateway. After a close call during a restructuring, American was able to keep Japan Airlines (JAL) as a joint venture partner.

While those Tokyo-focused joint ventures were nice, they had problems. The biggest issue was around capacity constraints. Tokyo’s preferred airport, Haneda, was only relatively recently reopened for international service, and it was further restricted on US flights to night-time hours until even more recently. While some US flights are now into Haneda, most are still sent into Narita due to a variety of restrictions. Narita was a thriving international hub, but it’s an airport that’s increasingly focusing on leisure travel business from low cost carriers. It’s far less convenient than Haneda for most of Tokyo. Plus, it has this problem…

I don’t need to rehash all the Godzilla-related issues, but the point is that Tokyo still has a split airport system and that makes it tougher to build and develop new service especially when that new service has to go to the airport that’s falling out of favor. Early on we saw Japan Airlines and ANA build up service into secondary US markets like San Jose, San Diego, and Boston. But they’ve been relatively stagnant since those early days.

In the meantime, Delta has done nothing but shrink Narita. Today, the only flying Delta does from there to non-hubs is to Singapore, Manila, and Honolulu. Many of the flights have moved to Haneda, when possible. In other words, it’s not really a hub anymore. At the same time, the Seattle hub has struggled to support all the service Delta wanted there. Most recently, the airline walked away from Seattle to Hong Kong. Delta needed something to fix its Asian issues. It needed Korean.

The joint venture between Delta and Korean should have happened long ago, but relations soured under Delta CEO Richard Anderson. As soon as Ed Bastian took over, it was like a switch flipped. Ed had tended to that relationship even during rocky times, and now with Richard gone, the joint venture was a no-brainer. The thaw began two years ago, and the joint venture launched this year.

The airlines have not wasted time since then. Delta previously served Incheon via Detroit with Seattle being added in the build-up back in 2014. In June 2017 in anticipation of growing ties, Delta added Atlanta to Incheon to complement Korean’s existing service. The airlines rapidly expanded codesharing to get maximum benefit.

This summer, fresh off the opening of its brand new, sparkling Terminal 2 at Incheon, Korean bulked up its schedules into the US where it was already the largest Asian carrier. Dallas/Ft Worth went from four to five weekly flights. Seattle went from five weekly flights to daily service. But this was a just an appetizer for the real growth which begins next summer.

Delta announced it would start flying from Minneapolis to Incheon in April of next year while Korean would begin flying from Boston. Why Korean and not Delta? Well, its 787s are the right aircraft to make that work, but it only works with the Delta customer base being onboard.

These early moves make a great deal of sense as the two airlines begin to mesh their networks, but will this just be an early push that flattens out like most of the other joint ventures? It doesn’t seem like it should end that way. Incheon’s new Terminal 2 is an incredible facility, and the airport has capacity for growth. That Boston flight will feed into dozens and dozens of destinations beyond Incheon. Meanwhile JAL’s Boston flight has to deal with the declining options at Narita for feed. But what may be most remarkable is that even with this just being a start, Delta/Korean already have a lead.

It’s still mind-boggling to me that JAL/American and ANA/United haven’t tried to penetrate more into the US as has been done through partnerships over the Atlantic. But JAL/American still can’t even justify a 787 into the Phoenix hub, and ANA/United haven’t added a new dot in the US from Tokyo since 2013 when San Jose joined the network. (JAL is expected to start Seattle next year, but that’s hardly inspired.) Even though Korean/Delta are years behind in developing their relationships, the others have squandered their leads.

These early moves by Delta and Korean are easy fill-in-the-blank efforts. But as time goes on, I imagine we’ll see them get even more creative.

August 13, 2018 at 01:45PM Source:

Southwest Struggles With Denied Boardings, But…

Southwest Struggles With Denied Boardings, But Others Are Worse:

Yesterday I wrote about the denied boarding trends at Alaska, American, Delta, and United. Today, I’m going to start with Southwest and work my way through the rest of the branded airlines that report their numbers.

If you’re comparing to yesterday, remember that these numbers from the Department of Transportation’s Air Travel Consumer Report are for mainline only. None of these airlines I’m writing about today have a regional operation except for the miniscule one at Hawaiian, so it won’t be an issue unless you’re trying to put aggregate numbers side-by-side with the big guys we looked at previously.

Southwest Declines, But Not As Much As You’d Expect
As I alluded to yesterday, Southwest is a particularly interesting airline to review, because last year it made the decision to follow JetBlue’s lead and stop overbooking entirely. With that, you’d think the numbers would drop to near zero, right? Well…

Yes, the numbers went down significantly but that’s a long way from zero. Involuntary denied boardings are still strangely high for an airline that doesn’t overbook at all. In fact, its 669 total involuntary denied boardings were higher than Delta, American, and United combined. So what gives? I asked the airline for comment and was told this:

The reason we still have involuntary denied boarding are related to day-of-travel operational issues. In these situations, we’re focused on helping our impacted Customers, which may result in re-accommodating a Customer from a flight that was impacted by a day of operation issue by overbooking them onto another flight. This helps ensure they get to their destination in a timelier manner. This can sometimes result in an involuntary denied boarding situation on the second flight.

Our Ground Operations Teams are focused on helping our Customers who are in these situations to get them to their destinations as quickly as possible.

In short, Southwest won’t let you overbook, but it’ll definitely let its own agents do it. I find this really strange that it hasn’t been able to get a better handle on the situation. That’s more than 7 people a day who get bumped involuntarily, and it’s apparently a self-inflicted wound.

JetBlue Fixes Last Year’s Problems
JetBlue has always said it won’t overbook its flights, so it really shouldn’t have denied boardings. But it does. This year, however, it seems to have made improvements.

The airline has clearly made significant strides in reducing that astronomical involuntary denied boarding rate. This wasn’t a one-off thing in 2017. I wrote about JetBlue’s issues back in 2016 as well. It appears that the airline has finally righted the ship, or at least it got lucky. With only 7 people bumped involuntarily and a still low (if slightly higher) volunteer rate, JetBlue seems to have figured out how to stop making people mad (at least through denied boardings).

Frontier Does Poorly…
Oh Frontier. People want to love you, but you make it so tough.

In an age where nearly everyone seems to be improving, Frontier is not. Oh sure, its involuntary rate went down ever-so-slightly, but that’s still far worse than pretty much every other airline. (We’ll get to the exception to that rule next.) The number of volunteers required went up significantly. I honestly don’t know what to make of these numbers since it’s hard to know if this is by design (less likely) or due to operational issues (more likely). But what I do know is that these numbers aren’t good.

…But Spirit is Worse
And then there’s Spirit. If you thought Frontier’s numbers looked bad, you’ll want to see this:

Yes, the airline’s rate of involuntary denied boardings went down, but it was still the worst by a mile when looking at all airlines. To give you some perspective, Spirit bumped 410 people, that’s only 73 less than American yet American carried more than 5 times as many passengers. My assumption is that the airline would have looked a lot worse if not for its huge increase in voluntary denied boardings. I know Spirit has worked hard to get its operation in order, so you’d think these numbers would look better, but they don’t. For those who like getting paid to get bumped, Spirit looks to be your best bet.

Hawaiian Outperforms
I couldn’t end on that note, could I? Let’s go with something calm and soothing to finish… Hawaiian.

Hawaiian involuntarily denied boarding to 2 people in the entire first quarter. I’m sure those two people were mad, but that’s a tiny number. You might notice that voluntary denied boardings climbed, but look at the rate. That is incredibly low. In fact, it’s the lowest rate on here (unless you isolated Virgin America). This makes sense, because most of Hawaiian’s travel is leisure-based. Those people book further out, and they show up when they fly. A lot less overbooking is needed compared to a business-heavy network.

One more interesting note to end on. Allegiant just started reporting this year, so I couldn’t do a comparison. The airline apparently doesn’t follow in its ULCC-brothers’ footsteps. It had an involuntary rate of 0.18, same as Southwest. But it also had no voluntary denied boardings, so apparently it doesn’t even try to avoid those involuntary ones. Seems like an easy fix there.

Overall, airlines are doing a much better job of cutting back on involuntary denied boardings, and that is good. If you’d like more detail, see page 34 of the DOT report.

August 07, 2018 at 01:45PM Source:

Denied Boardings Have Plunged For Most Airline…

Denied Boardings Have Plunged For Most Airlines But Not American (And That’s Not Bad):

Everyone remembers what happened on April 9, 2017. Ok, you might not recall the exact date, but that was the day that the Chicago airport police forcibly dragged Dr. Dao off a United Express flight, leaving him bloodied. The flight wasn’t oversold, but the regional airline that operated the flight had to get some crewmembers on board at the last minute. That meant it had to deny boarding to some passengers who had already boarded the full flight. The resulting uproar forced many airlines to broadly address the issue of denied boardings during the second quarter of last year. But have things changed? They sure have, and we now have the numbers we need to do a year-over-year comparison. I’m going to get into the weeds in this two-part post. Today we’ll look at United, Delta, American, and Alaska. Tomorrow, get ready for Southwest, JetBlue, Frontier, Spirit, and Hawaiian.

The Department of Transportation (DOT) releases quarterly denied boarding numbers. Since the Dr. Dao incident happened in the second quarter of last year, the ideal before/after comparison is between the first quarter of this year and the first quarter of 2017. The most recent report gives us what we need.

What’s the headline? Well, involuntary denied boardings (where the airline denies boarding even though the traveler doesn’t want to cooperate) dropped from 9,566 in the first quarter last year to 2,254 this year. The rate per 10,000 passengers flown plunged from 0.62 to merely 0.12. Voluntary denied boardings (where people volunteer to give up a seat when the airline asks for help) also went down from 102,285 for the first quarter of 2017 to 85,607 in the first quarter of this year. So, overall, the airlines did what they said, but let’s look deeper because there are different stories to be told at each airline.

One note before we get into the details here. When I show data for an airline, I’m showing only the mainline operation. Regional airlines still report on their own, and it’s not possible to determine if a passenger was on, for example, a SkyWest flight operated for Alaska, American Eagle, Delta Connection, or United Express. That’s not to say there hasn’t been an impact on them, but it’s easier to just leave them out to see a clearer picture.

United Kept Its Promise
Let’s start with United since that was the airline that started this mess in the first place. After the Dr. Dao incident, United put out an action plan saying it would reduce overbooking, offer higher compensation to get more volunteers, and do a better job of proactively soliciting people to give up their seats in advance. This seemed like overkill, and it should have made the numbers go way down. To nobody’s surprise, that’s exactly what happened.

As you can see, involuntary denied boardings almost went to zero. There were actually a total of 27 for the entire quarter, down from 900 the year before. There will always be a couple denied boardings thanks to a last minute aircraft swap or some similar issue, but United promised to get aggressive in combating the issue. It did. On the voluntary side, things declined as well. Presumably this is because of the decision to reduce overbooking. Naturally you would need fewer volunteers if you did that.

Delta Keeps Doing It Well
Now let’s look at Delta, an airline that long ago figured out how to handle oversold flights.

Delta reduced its involuntary denied boardings from almost nothing to even closer to nothing. It technically had a rate of 0.004 since the airline did involuntarily bump 13 passengers, but that is insignificant (unless you’re one of those 13, I suppose). On the voluntary side, you’ll see Delta had a much higher rate than United, but it still managed to reduce it significantly. Why is it higher? Because Delta was smart, and the airline aggressively sought out volunteers.

Delta has long had a high number of voluntary denied boardings, but a customer that volunteers is a happy customer. Delta made the decision that overbooking was worth more to the airline than the cost of paying out in vouchers to volunteers. That’s what United should have done. But we still see a big decline this year in volunteers on Delta. That could be due to a shift in revenue management or it could just be luck of the draw. Either way, those numbers are only concerning in that for travelers, it means there are now fewer options to get paid.

American Trends the Other Way
Moving on to American, we see an airline where the number of voluntary denied boardings has actually gone up.

That may be a surprise, but it shouldn’t be. After all, American said in the wake of the Dr. Dao incident that it would start raising the cap on what it offered to recruit volunteers. The end result is that the number of involuntary denied boardings has dropped a lot, though it’s still higher than the other big guys with 483 total. (That is small enough, however, that a handful of poorly-handled winter weather events could have accounted for a lot of that.) Interestingly, voluntary denied boardings have gone in the other direction.

I asked American about the shift, and this is what I was told:

At American, we strive to provide the best customer experience and that means having seats for every passenger, every time. While the chances of being denied boarding on a flight remain extremely rare, unplanned events such as weather or mechanical needs do occasionally impact our flights, and any time there are more passengers than seats on the airplane, our team members aim to resolve the situation by asking for volunteers. Our involuntary denied boardings are at the lowest point in American’s history.

That doesn’t say a ton, but it does sound like an airline that’s not looking to make any changes to its current plan. It should be noted that American’s volunteer rate is still well below Delta’s, so this is probably by design. Remember, a volunteer is generally a happy customer, so it’s just up to American to decide if the extra revenue benefit is worth more than the costs involved. It sounds like American believes that to be the case.

Alaska Surprisingly Improves
To look at Alaska, I added together both Alaska and Virgin America together. Virgin America actually performed better than Alaska, but it was the same airline managing both sides of the operation, so it’s worth counting as one. Here’s what happened.

Considering that Alaska is in the throes of a merger here, you’d think it would have suffered more than it did. But Alaska made real strides on reducing its bumping numbers even though on the involuntary side, it’s still one of the worst. Then again, it does overbook and it saw the same result as Southwest, which doesn’t, so that says something.

Come back tomorrow and we’ll talk more about Southwest’s surprising results along with the rest of the airlines that report, including the worst offenders.

August 06, 2018 at 01:45PM Source:

3 Links I Love: The Dulles-Miami Shuffle, Flip…

3 Links I Love: The Dulles-Miami Shuffle, Flip-Flopping in Georgia, Via Air’s Not-So-Stellar Record:

This week’s featured link:
United adding Miami-Washington Dulles flights as American drops routeUSA Today
As someone who lives close to Dulles said to me, “Am I the only one shocked to find out they didn’t already fly this?” Sure enough, United didn’t fly Dulles to Miami, but it will now. I didn’t pick up that American was also dropping the route until I saw it here. I remember back in college when United flew an evening flight from National down to Miami to meet up with its Latin bank down there. When that mini-hub closed, the flight disappeared. And United has long been a ghost in Florida, though Continental had a much more robust offering than United when the merger happened. I assumed this new service was meant to help United in its quest to focus local traffic in Newark and connecting traffic in Dulles, however, that southbound flight leaves at 8:15am. I guess that picks up some connecting traffic from nearby, but this is definitely not part of the European hub.

Two for the road:
Jetlagged: Kemp shifts stance on airline fuel tax break Atlanta Journal Constitution
Remember when the Georgia legislature flipped out at Delta for removing a discount for the NRA and decided not to give a fuel tax break? Well, now that the primary election absurdity is over, Georgia’s governor went ahead and gave it anyway. Of course, this is still a political issue. The Republican nominee has now flip-flopped from his previous stance and supports it, because, well, I guess he’s determined he’ll benefit more from sounding a pro-business stance in the general election.

Via Air reviewing policy after stranded passengers claim promises brokenKXAN
I’ve heard of Via Air and seen their airplanes around, but I don’t know much about the airline. It sounds like at best they’re having growing problems. At worst, there could be some seriously shady business practices going on here. Let’s hope it’s the former and this gets fixed before it kills the airline. (via View from the Wing)

August 03, 2018 at 01:45PM Source:

An Amazing Bag Check Process Followed By an OK…

An Amazing Bag Check Process Followed By an OK Experience on Alaska (Trip Report):

You’ve heard about the flight up to Seattle before our Alaska cruise; now it’s time to talk about the trip home. A couple days into the cruise, I was greeted by a very welcome note. The Port of Seattle — the entity that operates both the cruise port and the airport — has a fantastic free program where you can submit your confirmation number to the cruise line. They will print your boarding passes and bag tags onboard and deliver them to you in your cabin. The program allows you to pay for bag fees, but if you don’t have them (we didn’t thanks to the Alaska Visa), you can state the reason why and they confirm with the airline. Sure enough, Thursday night, we had in our stateroom four boarding passes and two bag tags with no charge. We just had to affix them to the bags and leave them outside our cabin Friday night by 11, and they would be magically transported to baggage claim in LA. I have no idea if other ports do this since I haven’t cruised much, but I can’t say enough good things about the program.

On Saturday, the rule was that to take advantage of this program, you had to walk off the ship by 8:30am. So we did, and then we took a Lyft straight to the airport. The place was pure chaos, as is apparently always the case since Delta and Alaska continue their arms race. After waiting in a long line at the curb, we got off and found the Pre Check line on the D gate side surprisingly short. Our boarding passes from the ship worked fine (how did they get those to us more than 24 hours before departure?) and then we realized we had a long time to kill.

The kids were bouncing off the walls pretty much the entire trip, so we quickly sought out the play area over near the B gate entrance. We let them run around and go insane while we just sat there reading. My wife grabbed some quesadillas from Qdoba right next door and we wandered over to our gate, back on the other side at D3.

I have no idea why Alaska is doing this, but as on our way north, the airplane boarded absurdly early. In fact, we arrived at the gate at 11:10am, 35 minutes before departure, and the gate area was completely empty. Boarding had been completed.

The agent took our boarding passes and then sheepishly looked at my wife’s bag. Alaska recently settled on a single carry-on bag size requirement post-merger, and it has decided to aggressively* enforce that rule. (*Aggressively in Seattle, I guess, because nobody cared in LA). My wife was told to put her bag in the sizer and it didn’t quite fit. We were told that she’d let us gate check the bag for free this time, but next month Alaska was going to start charging.

Down the jet bridge, there were maybe a dozen bags lined up waiting to be taken down. Once onboard, we saw nothing but largely empty overhead bins… and undoubtedly at least a dozen angry people.

June 30, 2018
Alaska 1784 Lv Seattle 1145a Arr Los Angeles 235p
Seattle/Tacoma (SEA): Gate D3, Runway 16C, Depart 3m Early
Los Angeles (LAX): Gate 62, Runway 24R, Arrive 33m Early
N528VA, Airbus A319-112, Virgin America colors, ~95% Full
Seat 9B, Coach
Flight Time 1h58m

On the bright side, I had no problem finding a spot for my bag. I put mine up along with our coats, and then sat down. This airplane, like the last one, looked to be a little worse for wear on the inside, but it was better than the aircraft we took on the way up. We were just focused on trying to keep the kids occupied while we waited to finally leave. Just a couple minutes before departure, this was the scene.

But then, a giant among men ambled down the aisle and took the open aisle seat next to me, dashing my hopes of extra space.

Departures were heading south, and I had hoped that the clouds were low so that my wife and kids could finally see Rainier in all its glory. (It was obscured the whole time we were in Seattle.) We took off and went into the clouds quickly. Then we came out and there was another layer above us. We came out of that and there was one more. Damnit. We didn’t get out of it until about 20,000 feet, and so there was no view of the mountain for us. Even worse, the clouds parted completely just to the south. By the time we passed Mt St Helens, this was our stunning view:

It was a quick sub-2 hour flight down. I again used the onboard ordering, and this time the flight attendants brought it to us without asking what we wanted. I opted against using the remains of Virgin’s entertainment system on this one since I wanted to finish Cloud Atlas, a book a good friend of mine had suggested and one that had me captivated.

My daughter passed out almost immediately, so I had a nice, uninterrupted stretch to read. Descent into LAX was bumpier than usual. We landed early and I was shocked to find out that we had a gate waiting for us. The gate agent came on to tell us bags were at claim 3, so we headed down there.

Upon arriving, claim 2 showed as the location for bags from our flight, but nothing came out. At one point, it must have shifted back to 3, but there was a lot of confusion. The guy next to me asked if the New York bags were coming on this carousel. We all just shrugged.

More than 20 minutes after landing, my wife’s gate-checked bag showed up. A few minutes later the other two made it as well. Thank you to the Port of Seattle for that seamless baggage experience. But there was one last thing that bugged me.

Alaska used to have that guarantee that your bags would show up within 20 minutes or you’d get a discount coupon or miles. I saw no trace of it anywhere in the baggage claim area, so I googled it. Sure enough, it still exists, but you have to go talk to an agent to make a claim. I went into the baggage service office, and the agent there took my boarding pass and wrote up a couple of business card-sized papers for us to redeem online to get the bonus miles or a coupon.

I don’t know why this program still exists if the airline isn’t going to talk about it. And I’m also not sure why the process has to be so clunky.

Our bag-checking experience with the Port of Seattle was excellent, but this wasn’t the best experience on Alaska. This seems to be the point in the merger where the airline is just struggling to unify the product, and that appears to have created some unfriendly policies and choppy experiences along the way. I hope this phase of the merger is over quickly.

August 02, 2018 at 01:45PM Source: