US Airways/American Airlines Merger: A bad idea that probably has to happen

American Airlines, US Airways merger talks start. Scott Mayerowitz, AP via Chron.com

American Airlines and US Airways are one step closer to a potential merger.

The companies said Friday they signed legal documents allowing them to confidentially exchange information. But a deal is still far from reality.

"It does not mean we are merging — it simply means we have agreed to work together to discuss and analyze a potential merger," US Airways CEO Doug Parker said in a letter to employees Friday.

A merger will fold together two airlines that already have a lot of duplicate operations and, presumeably, place US Airways management in charge of the new company.  There doesn't seem to be many strategic reasons for following through with this merger other than the fact US Airways CEO Doug Parker wants, desperately, to be in charge of a big airline.

I've a feeling that's all it's going to take.  Given the size of competitors Delta and United economies of scale suggest that, if there is no merger, or if one player is left out, they're doomed long term.  This will leave three giant airlines and a bevvy of small, low-cost, poviders battling it out of the consumer dollar.  It will also signal a retrenchment in the North American airline industry.  The big three will dominate their hubs with reduced competition which will result in higher consumer prices.  Ironically, although it will anger the consumer, this will be healthier for the remaining players in the long run.  Higher prices = increased profitability.  In order to find low fares passengers will be faced with ticketing at fee-based airlines such as Spirit and Allegiant, with Southwest remaining the outlier. (advertised as low-cost -but not really- with (for now) fewer fees).

While there's still chatter out there, from industry analysts and bloggers that this merger is unlikely to occur, I firmly believe that it will.  I also believe that Federal anti-trust approval is almost a given.  Were there any concerns on those fronts they would have arisen in the United-Continental tie.

A "new" American Airlines is coming, whether or not it's an "improved" AA remains to be seen.  I'm doubtful on the latter.

Future United: IAH

Stumbled across a pretty good piece of speculative blogging this morning regarding United's future plans for IAH.  Some you probably already know, some you might not.

United's Hub Capacity Dance. Edward Russell, Airline Business Blog @ FlightGlobal.com

The Chicago-based airline is in the midst of a network realignment that should build on the strengths of its 10 hubs while eliminating the weaknesses. Part of this is a 10% capacity cut at its largest hub in Houston by 2015 that, while officially in response to the local city council's decision to allow Southwest Airlines to build a federal inspection services facility for international arrivals at the city's Hobby airport, is widely seen as a big part of the rationalisation of the legacy Continental Airlines and legacy Untied networks.

(...)

New crew bases, increased gate counts and lower airport rental fees in Chicago and Denver all suggest that this capacity shift is happening. First, United said that it will open a Boeing 737 base in Chicago and a Boeing 767 base in Denver with legacy Continental crews, and an Airbus base in Houston with legacy United crews in August. This allows it to bring the Continental 737 fleet, which is larger and younger than the Airbus A319 and A320 fleet, to O'Hare and more larger aircraft to Denver.

Of course, there's nothing new about the 10% capacity cut to IAH, we've already started to see the effects of that, as well as United's terrible PR blunder blaming the City Council's Southwest Airlines decision for changes that were probably already in the works.  What was new, to me, was the addition of an Airbus base in Houston and the probably shifting out of the legacy Continental 737 fleet to Chicago.  This means that, overall, Houston is going to get older, less reliable birds that are lacking in amenities and comfort. Houston is also going to be inundated with the new "slim" fuel-cutting seats that are also, according to some people who have sat in them on international airlines, borderline excruciating if United doesn't decide to accept the extra padding upgrade.  Given United's operational stance of late, I'd say the odds are 30% for them spending extra money for passenger comfort.

From what I can see, these changes portend a drop in the hard product flight experience for UA customers flying out of IAH.  They're going to be put into older, and in some cases woefully under-powered, metal with uncomfortable seats, no chance of getting in-flight wi-fi, a reduced number of flights with in-seat power jacks and worse choices for in-flight entertainment.  While it has been revealed that IAH is going to receive the Nightmare Dreamliner even that is a service reduction, in terms of overall seat numbers.

Given that Houston customers don't appear to be in a conciliatory mood I'm unsure why United would want to focus many resources in that hub, choosing instead to focus on Chicago and Denver where they're being given financial reasons to do so.  You have to think that the IAH-AMS and IAH-LHR planned Nightmare Dreamliner service is going to be directed more to connecting passengers than anyone flying based out of Houston. (Although, it will be a plus to Houstonians should they choose to partake in the service, if the plane is as advertised)

Continental billed IAH as "their largest hub" and spent years throwing Billions of dollars of hard and soft product toward it.  Now that United has taken over the economies of scale have determined that IAH, while still a prominent hub to be sure, will not be the key player in the game that it once was.  Is this attributable to the Southwest/HOU expansion decision as United claims?  Certainly not, but the decision to abandon long-term agreements at IAH certainly didn't help.  So, getting back to the title of this post:  Future United at IAH is certainly going to be much less cutting edge and passenger friendly than present United at the same.  IAH will move from a global hub to a more regional (South America) hub with a noticeable downgrade to the domestic hard product.

Probably not the future the Houston Airport System had in mind when they started this fracas, but a future that they could probably do very little to prevent from materializing.  Given the nature of large companies, these changes have been on the drawing board for a while, City Council and the HAS have just provided United with a scapegoat allowing them to justify it.  That no one is buying into their flimsy rationalization is totally beside the point.

Short Haul Flights (08/28/2012)

Still trying to catch up from last weekends travel......

Remember my post about how credit card referrals were damaging travel blogs?  I offer the following into evidence:

View From the Wing 1
View From the Wing 2

One Mile at a Time 1
One Mile at a Time 2

In both cases the bloggers in question devoted more than 1/2 their daily blogging output to credit card referral deals.  They're both averaging 2 credit cards posts for 1 travel post.  The natives are starting to get restless.


Besides being a thinly veiled outlet for advocacy journalism, one of the complaints against the Texas Tribune is that they are too Austin focused.  I'm not sure about that since they are a political reporting operation, but they sure do love them some Texas Longhorns.

Romney's big mistake was not making a birther joke, it was assuming that anyone on the left has a sense of humor.

Yes, Please, Please, Please draft Cecile Richards - Because what the Texas Democrats really need to do to show the State they are in line with their values is to nominate someone slightly to the left of Ralph Nader. Either the Texas Dems are happy with their plucky underdog status or they really don't get it. (I'm betting on the latter)

Speaking of the fringe left, David Crossley has finally wandered so far off the reservation that even Kuffer can't follow him.  What you have lining up against the Metro referendum are all of the right enemies to have.  Given that a "yes" vote is a good idea.  Maybe this little snit-fit will cause Mayor Parker to reconsider some of her Metro board choices and make some serious replacements but I'm not holding my breath.

Apparently, the only things you need to know about Michael Williams is that he's pro voucher and previously was an elected chairman of the Texas Railroad commission. The fact that both of his parents were educators, and that he has a resume full of education experience that makes him qualified for the job, is only something one in Texas' lockstep political media would choose to report on were he of a more mainstream (read: liberal) frame of mind toward education issues.

So, the RNC protesters don't like Texas. This makes sense when you consider the Occupy and Code Pink movements don't like to have anything to do with anything that's remotely successful, including their own groups.  Which is why they're dressing up as vaginas and had such a crime problem in their public park sit-ins.

And finally.....

So, you're a member of the media and you're not invited to a RNC delegate party.  What to do?  If you're one reporting member of Texas' lockstep political media the answer to that question is to make up a laundry list of things you imagine they might do and then suggest that surely they wouldn't, and then use that as the basis for your story.  Yes, this is how far Texas political reporting has devolved over the last several years.

Short Haul Flights (08/27/2012)

Includes a lot of things I missed while in Alaska.....



USADA has been after Lance for years. - They finally got their man, never mind that they ignored due process and the rule of law to do so.

The Agenda 21 nut-jobs now have a National face. - Maybe they can recruit Craig James?

Taxpayer funds to downtown developers to build homes for the well-off. - The Houston Way.

Randy Travis is either melting down or he has a new album coming out soon. - I haven't heard anything on the latter so I'm assuming the former.

You see, weather is a system. - Not just a series of single events.  The problem with the AGW nuts is that they don't understand this.

The voice of Sesame Street's Count passed away.

Neil Armstrong passed away.

One man helped teach a generation to count, the other inspired Millions of people to dream.  RIP to them both.

The debate over airlines and dress codes. - Airlines should be able to enforce them, but they should also be required to clearly spell out what is acceptable and what is not. It should not be arbitrary.

Samsung cribbed ideas from Apple. - OK then. (Still not buying an Apple device)

Houston Democrats gone wild. - In what could be the funniest story of the local election news cycle.

So much for Berger being "non-alarmist" - This guy is worse than the real meteorologists on TV.

Free Texas Prostitutes! - I can't see that being an election-year battle cry, but you never know.

Perry Derangement Syndrome continues. - Let me help the political writers at the Chron here for a second.  Perry lost to Romney, it makes sense that the actual candidate for office get the majority of the attention, not the people who lost to him.  Hope that helps.

The case against Chip and Pin technology in credit cards. - It's a case I agree with, especially on the consumer protection front.

Why, even lowest tier, elite status still matters. - I wrote a post similar to this a few weeks ago, although I don't think the reasons to remain loyal are as many as this writer. (There are a few advantages however)  I also think the cards will continue to gain ground on elite status because it's so profitable to the airlines.

When the Houston Press criticizes anyone on thier falling journalism standards.  - Hilarity ensues.

Sadler to Cruz: Go back to Canada. - Leave it to the Newsish Texas Tribune to "break" a non-story from an unserious candidate.  Or, why it always helps to know your friendly news outlets.

Ron Paul Supporters are angry. - In related news, hurricanes have strong winds.  If this is the biggest scandal you can find.....

And finally.....

The Chron's former teen columnist decides to whine. - A LOT.  In a real newspaper she'd be a staff reporter, at the wreck that is the Chron she's given a byline.  This concludes this week's "our newspaper sucks" rant.

Santa Barbara: Brophy Brothers

A few weeks ago (I know, I know) when I did my initial write-up on Santa Barbara I promised to talk more about some of the food we ate while there. Due to its location on the coast there is, as you might imagine, some good seafood on menus.

If you take the State St. Trolley down to the end of the line (you'll be at a round-a-bout with a dolphin statue) you'll find several dining options. After speaking with locals The Wife and I had narrowed it down to two choices.  The Santa Barbara Shellfish Co. or Brophy Brothers we decided to go with the latter due to it's placement in the middle of the harbor.  The Shellfish Co. looked good but it's on the end of a long fishing pier with nothing really around it. Brophy Bros. seems to be a small local chain (OK, they have two locations), but it doesn't really have a chain feel when you're in the restaurant.  Their menu is here.

When you arrive at Brophy Bros. you have to go up a flight of stairs to get to the hostess' stand.  If there's a wait (and there's usually a wait as I understand it, at least on the weekends) then you're given a pager and invited to go downstairs to a small bar where you can wait.  The Wife and I decided to wait down there, me with a vodka tonic, her with a Bloody Maria.  After about 15 minutes, or so, we were paged, walked back up the stairs and were seated.

Since we live in Houston and oysters are off the menu for a few months, I started with 1 dozen on the half shell and my wife chose cold boiled shrimp.  There are no pictures of these because they didn't look any different than what you would think they would look like.  I chose, for my drink, a California beer called Firestone DBA (Double Barrel Ale) it turned out to be a hoppy, deep amber beer with some spice notes that lingered after drinking in a non unpleasant kind of way.  Besides this they had the usual run of domestic beers, of which the crowd inside seemed quite content to drink in good quantities.


Brophy dining room



FireStone DBA

For our entrees I chose crab cakes with rice pilaf and a cup of clam chowder(not pictured) and The Wife chose the celiac's version of fish and chips, broiled Mahi Mahi with fries. She had a salad (not pictured) instead of the chowder for obvious reasons.

Crab cakes w/rice pilaf and cole slaw



Grilled Mahi Mahi with chips and cole slaw

Both of us were very satisfied with our menu selections.  The clam chowder I had for the soup/salad course was served in a coffee cup with oyster crackers and was very good.  There's no chowder picture because when it got there I chowed down. If you have any question as to why I'm not a food blogger, part of it lies with my unwillingness to stop and take a picture of everything placed on the table.

The highlight of my meal was the crab cakes.  They were well seasoned and definitely contained more crab than filling. I appreciated the kitchen placing the dipping sauce on the side instead of pouring the ribbon over the top of the cakes as is the rage now.  The sauce was similar to a roumelade, but it was listed on the menu as a "roasted red bell pepper aioli".  The rice pilaf was OK, nothing special but certainly not bad.  My wife's Mahi Mahi was cooked well, lightly seasoned and the mango chutney that came with it was very good.  If I had to pick nits on her plate the fries were poor.  Mushy fries that tasted like they could have sat in the oil for just a bit longer.  Definitely frozen, not made on site.  If they were made on site then Brophy Bros. needs to work on that.

I want to spend just a minute talking about the cole slaw because it was the absolute best cole slaw I've ever had at a restaurant period.  The Brophy Bros. version is a cream style slaw, but it's obvious that they are making this in house because I could taste the fresh cabbage underneath the sauce.  Brophy Bros. is one of the few restaurants that don't over sauce their slaw.  It was outstanding, fresh tasting and my wife considered ordering a pint to go, but we didn't have a refrigerator in the room so she passed.

Above the food however, the best thing about Brophy's is the view:



View from front lower bar




View from front




View from upstairs dining area




Side view from upstairs dining area




View of beach on walk to Brophy's.

 As the sun is setting, during the golden hour, the view from Brophy's is probably one of the prettiest vistas up and down the California coast. The beach there is amazing, although not the white sandy beaches that you might think.  Oddly, we did see a few oil rigs off in the distance out in the water.  Certainly shallow-water wells on State lands.

I'm not in the business of 'rating' restaurants.  For one, I'm nowhere near a food critic, I'm also aware that my expectations and likes are going to be different than yours.  I will point out that the atmosphere at Brophy's is casual, and it's a very loud dining room, so it's probably not the place to take someone for a romantic evening out.  However, the customers that are there seem to be locals or people who spend a lot of time in Santa Barbara so you do get a pretty robust view of local culture.  The seafood is fresh, the service is pleasant if not formal/professional (most of the wait staff seemed to be local high school or UCSB students) and they did a good job keeping the drinks full and taking care of needs. I did notice a lot of them working together as a true team, running food to other tables, filling drinks at tables, bus-boys helping with water and tea refills etc. so that helps getting the customers (and tables) turned.  All in all a pleasant evening out with a good meal. 

Highly recommend.

SFO - SBA Good photos at 6,000 feet.

Last month, during our quick weekend away in Santa Barbara, one of the legs of our trip was SFO - SBA via United express.  The entire flight took around 45 minutes and we never got higher than 6,000 feet.  Because of this the wife was able to snap some nice pictures of the California countryside:

Unfortunately, there was a haze

Note the municipal airport.

Very hazy

We also snapped some pictures of Air Alaska planes with their Disney livery:

50 years

Characters

I'm not sure why, but that last picture is loading on my blog upside down.  I guess Blogger doesn't like Disney characters?

Anyway, I've got more Santa Barbara pictures that I'm going to be uploading to my Flickr page soon.  If you haven't seen that, the link is here.  A majority of my travel pictures can be found there as well.

Are Reward Credit Cards Ruining Travel Blogging?

I present to you the following evidence:

Exhibit A

Exhibit B

Exhibit C

Exhibit D

Exhibit E

That's a total of four five* blog posts devoted to one question:  How much are Hilton Hhonors points really worth.  And, in the end, it doesn't really matter because, as One Mile at a Time admitted, miles are basically a personal choice.

Before I go any further let me make one thing perfectly clear: I LIKE both of these blogs.  I really do.  One Mile at a Time runs some great trip reports, as does View from the Wing. Both guys know and understand the industry and can post some great aspirational trips.

All that being said, it's getting to the point where one in four blog posts is a shill for another credit card "deal" (for which the blogger receives a kick-back -a fact they admit on their blogs) that's just too good for the reader to pass up.  In some blog posts you get the feeling that, if you don't click on their link, you're going to be left out holding a light points bag while newly minted credit geniuses hop on board expensive planes and fly away to places you can never hope to go, safely tucked in on the good side of the flimsy little curtain that's pulled close shortly after 10,000 feet.

Look, I've got nothing against bloggers making money.  In many cases I believe that a blogger should be paid more than the 'professionals' working for the media.  In the travel industry I think this is certainly true, but as the big bloggers circle away from (you know) travel and more toward how to cash in with the latest credit card deal that only requires a $25K annual spend for 10K points with an extra 5K bonus if you're willing to donate your 1st born's spleen should it be needed.

It needs to be said that there is a good reason the banks are pushing rewards cards.  They're extremely profitable.  In many cases they carry a higher APR which can erode the benefits fairly quickly.  The easy answer to this is to "never carry a balance".  This is what all of the travel experts will tell you to do.  I do this on most of my personal credit cards (two of which ARE points cards FWIW) but, from time to time (like when my A/C went out a couple of months back) I needed the cash so I couldn't pay all of my balance off.

Sure, it's now paid down, but I got nailed for a month or two with a finance charge.  Fortunately, I was able to roll the charge on a low-interest card, but had I just paid for a big flight or something on a points card, the interest would have been painful to absorb.

The point is it's starting to get saturated to the point of breaking.  When blogs are breaking down into what the value of individual points are because this makes their referral links seem that much more lucrative then there's a problem. 

One of the reasons people have abandoned the MSM when it comes to travel advice is that there's a correct feeling that a lot of the articles are bought and paid for.  Travel bloggers offered an escape from that.  If a hotel had nasty carpet they would say it had nasty carpet and not that it was "homey".  There was a lean honesty that arose from some savvy travellers with a marginal writing ability popping up from time to time and saying "wait a minute, this trip sucked".

It's getting to the point that some of the bigger travel blogs are walking down the same road the MSM did except this time, it's about points credit cards carrying high annual fees and APR's instead of hotels with nasty carpet.

One last thought:  I said earlier in the post that I really do admire both of these bloggers for the quality of their travel related posts.  I'm not suggesting that the baby needs to be thrown out with the bath water.  As a reader, you always have the ability to ignore the CC sales pitches and focus on the travel-related content.  I suggest you do so.  Hopefully it doesn't get to the point that travel content is only about 25% of content instead of CC posts being 25%. 

That's the real fear.






*Updated 08/17/2012 @ 7:32 AM to include new blog post from View from the Wing.

Short Haul Flights (08/16/12)

The "B fare class" edition....

City Proposal aims to bring more rooftops downtown. Shaina Zucker, HBJ - You would think, if the market was there, developers would be all over trying to build residences in the high-property value downtown area.  Houston's new urbanist crowd has never let a little thing like logic stand in the way of building Houtopia.

November ballots will be rife with Houston bond issues. Shaina Zucker, HBJ. - That's $2.7 Billion dollars worth of bonds.  Yes, that's Billion with a B.  And contrary to Mayor Parker's 'no tax increase' statement the truth is that the bond issue authorizes one. Your mileage may vary as to whether that's reason enough to vote against the bond, but it is interesting that the Mayor feels the need to conceal the truth in such a manner.

American Airlines loses bid to toss pilot's contract. Sheryl Jean, DMN.com - It sounds like a loss, but a closer reading of the judges decision reveals it to really be somewhat of a win.  If I'm with the pilot's union I'm seriously trying to get back to the bargaining table before AA submits a new filing (and wins).

Spindletop Dog Refuge for Pit Bulls: What went so horribly wrong? Craig Malisow, Houston Press - Horrible story.  Just a horrible, horrible story.  As someone who does some pit-bull rescue work I just don't know what to say about this right now.  I do encourage everyone to read the story however, if nothing else to see that it's not the breed.  The dogs can be salvaged, it's the people I'm not so sure about.

Axelrod: "Chains" comment not racial. McKenzie Weigner, Politico - Oh boy.  Just Oh boy.  This is the end-game of the ridiculousness that's surrounded the racism debate over the last six or so years.

Armed stripper accused of attempting to rob man. ABCLocal:KTRK - OK this recession has gone on long enough.

Houston Immigrants apply for deferred action program. James Pinkerton, Chron.com - They'd be silly not to.

Private firm planning bullet train between Houton and Dallas. AP via KHOU.com - They're saying that they won't be spending public money so good luck to them.

And finally:

U.S. Makes History, and a Houston Texan and Dynamo were key. Jose de Jesus Ortiz. Chron.com - Historic win by the US, friendly or no. It's just a friendly but maybe the U-23's missing the Olympics was the wake-up call that the US team needed?

Can United be fixed?

That's the question asked by Christopher Elliott of Frommer's in an article running on KNDO.com:

Can United Airlines Fix Itself? Christopher Elliott, KNDO.com

I recently spent a day touring the company's new headquarters in Chicago, visiting with managers and executives who oversee customer service initiatives. Most of the meetings began with an apology and a promise: "We can do better."

But can it? Can United, still wobbly after a difficult merger with Continental Airlines, right itself?

The article itself is inconclusive. You get the feeling that Elliott liked the United executives that he spoke with but didn't exactly buy their lines.

Here's one example of why I think United has a long, tough road ahead of it:

I came away with a sense that United's managers in downtown Chicago are as exasperated as the customers who complain about the airline's substandard performance, but for different reasons. If we passengers could only appreciate the complexity of running an airline, they say, maybe we wouldn't be so quick to judge. If we could understand how difficult it is to merge two large airlines, we'd give them a break.

If that's the prevailing attitude at United corporate offices, then no, it's highly unlikely that United IS going to fix itself, at least without massive changes in the executive suites.

As a United customer, I'm reminded of the Al Pacino line in Ocean's 13: "Don't tell me about the labor pains, just show me the baby."  The problems, for the most part, in this case are not the customer. Sure there are a few people who wouldn't be happy if you set them down in exclusive class and had attractive 20-something massage therapists rubbing them down all flight with massage oil flown in from exotic locales that was handled by nothing but soft-handed virgins but, they're the exception.  Most people just want their plane to depart/arrive on time.  Business travellers need to make meetings and vacationers don't want to have to sweat the flight, they want to enjoy their time off.  Yes you're going to have people who are mad because you didn't treat them like the Maharajah of Suburbia and that's OK.  Those are the people the rest of us laugh at while they gripe that UA doesn't serve Krug in lead crystal.  They're also the people that swirl wine in a plastic wine cup so it's quite possible they could not be 100% right in the head.  Let's ignore them, focus on the rest of us.

Here's where United's failing:  Instead of telling us how hard things are, admit they're hard by hiring better and more customer service and fix the things that are wrong when the hard stuff pops up.  I'm probably going to be more understanding about a flight delay if the gate agent honestly and frequently updates me on the status and reason.  If the delay gets excessive I'm likely to be OK if customer service would consider waiving the re-booking fee as a convenience.  If I call (or e-mail) into customer service I'd like to get an answer before it's time to upgrade my cell-phone plan.  Also this: Smiles are nice.  I may have the dumbest question in the world but don't roll your eyes at me.  Not everyone is the fount of flying knowledge that you are Gatey.

This brings us to fees.

No one, except the airlines, are ever going to be happy with fees.  Eventually they will be tolerated, and someday they will become commonplace, but no one is ever going to like them.  The fee storm is going to have to be ridden out by the airlines because the genie is out of the bottle and there's no stuffing it back inside.  It might be wise for United to consider putting the brakes on any fee increases for a while however, because right now their customers tolerance levels are at all time lows, and an increase of a fee for worse service is hard to justify from a company who's CEO smiles on every flight and talks to customers about "changes we think you're gonna like."  Reactions that I've heard to Smiling Jeff's safety video introduction have ranged from audible boos to "I'd like to punch him in the face. I wonder if he'd like that change."  As a side note, Smisek is not a popular guy right now, it might be a good idea to hire a spokesperson.

Finally, there's this from the article:

And will the improvements be enough, or will they just affect a chosen few super-elites in the front of the plane?

This, to me, is a big worry, because everything that Smiling Jeff has mentioned has been about improving the business and first class hard products.  This tells me that they're OK with what's going on in economy or, more likely, that they really don't care.  I've never been one to begrudge First and Business Class fliers special privileges.  I believe that if you pay for those seats, or are upgraded to them, that you should expect a higher level of comfort and service, both in the airport and on the plane.  What I don't think is that the economy product should be ignored.  It seems, right now, that United is doing precisely that.  Considering the largest number of customers are going to be wedged into the sardine can in the back, you could at least make sure the cattle is treated humanely.

It also wouldn't hurt United to offer up a genuine dose of "we're really sorry" to the general public.  Then they're going to have to work to bring people back, each and every day, each and every flight.  I don't see that kind of effort happening until some sort of labor peace is obtained.

So, to answer the question at the beginning of this post: Can United be fixed?


I say yes, of course it can be fixed.  The real question in my mind is whether or not it can be fixed in time to matter, or can it be fixed by the current executive team?

Based on what I'm seeing and reading that answer is closer to no than yes.

What to do when 35,000 feet in the air.

Add "registering to vote" to the list.

You can now register to vote at 35,000 feet. Lauren Fox, USNews.com

Starting Tuesday, guests can register to vote on all of Virgin America's flights, about 1,000 flights a day.

The voter registration drive is in cooperation with "Rock the Vote," a non-partisan voter registration organization targeted at young voters, that hopes to get 1.5 million new voters engaged in time for the 2012 election.

This is something I would hope catches on at other airlines.  Sure, Spirit would charge a $10 democracy fee, Southwest would register people dozens of times and United voters would find their registration processed after the election but you need to start somewhere.

There is the problem of angering the "True the Vote" crowd, who would obviously demand voting monitors to ensure no registration hanky-panky was being committed by Sir. Richard Branson.  I agree.  As a matter of fact, I volunteer to staff one of those flights as a registration watcher provided it initiates out of IAH and allows me to spend a week in Hawaii during the Summer months.  I'm sure y'all can work out the rest of the domestic schedule yourselves.






Note: Hat tip to MilePoint for the link.

More bad news for United

The United States Department of Transportation customer complaint numbers are in for the first half of 2012 and they're pretty ugly:

United Airlines customer complaints soar in first half of 2012. Olivia Pulsinelli, Houston Business Journal.

United Airlines tracked the highest number of consumer complaints among all U.S. airlines during the first half of 2012, the U.S. Department of Transportation’s Air Travel Consumer Report shows.

Between January and June 2012, United Continental Holdings Inc. (NYSE: UAL) logged 1,740 complaints, more than three times the number tallied by American Airlines, which ranked second.

That’s also up from the 502 complaints United logged during the same period a year earlier.

Ouch.

ChronBlog weighs in as well.

United Fliers Voice their Dismay, Kiah Collier, Chron.com

Both articles mention the change-over to the SHARES computer system in March, which was undoubtedly the driving force behind UA's race to the bottom.  Beyond that however was the decidedly customer unfriendly approach that UA took to the entire situation.  It was almost as if Smisek and company ignored the impact such a change would have on operations, and had no contingency planning.

In Houston, things are worse.  As UA continues to streamline operations at IAH, their largest hub, there's anecdotal evidence that Houston fliers are starting to lose it just a bit.  Over the weekend blogger, and frequent traveller, Stephen Seagraves tweeted that he was hearing complaints against United for weather delays, with fliers somehow suggesting things would be better if CO was still around.  To be fair, In-flight entertainment experiences notwithstanding, the flights that I've had with United this year have gone fairly smoothly.  Madrid was a mess (right during the switch-over) as the wife and I both had boarding pass issues which caused us to be shouted down by gate agents, but our trip to Santa Barbara was, really, just about what we expected.

In many ways I think United is starting to smooth things out and operations are getting back to something resembling normal.  On a perceptive level however I think they have a long way to go. This goes double for Houston, where UA is currently viewed as something worse than Bud Adams, a civic Benedict Arnold if you will.  Is there anything they can do?  I think probably so.

 - Smilin' Jeff Smisek needs to come out and publicly apologize to customers.  There have been reports that he's apologized in investor meetings and conference calls but that rings hollow to many.  United needs to make a mea-culpa television commercial and fess up to their short-comings, promise to do better, and then DO better.

 - United needs to shoot straight with Houston about their future plans for IAH.  I believe UA when they say IAH will continue to be an "important" hub for them.  What I don't believe is that IAH will continue to be their largest hub.  At least, not in the long term.  Logistically IAH offered advantages to South America, and UA is going to be facing tough competition for those routes.  There's nothing that UA can do to bring back the portion of Houstonians who think their inferiority complex is the most important thing in the world, because of this they've lost the Houston Chronicle, the Apple Dumpling Gang, and everyone who comments on ChronBlog travel articles.  The good news is I believe that to be a small, but vocal, travel minority in Houston. They can do a better job being honest with the fliers they are retaining.

 - Just straighten up and fly right.  This is the biggest thing.  People will forgive a lot of woes if the flights leave/arrive on time, the service is friendly and things work.  Stop telling us about how great the nightmare Dreamliner is going to be and work on making sure the 737/757(etc.) product is everything it can be.  Producing a good product is key. Besides, most airports are never going to see the Dreamliner in person, but they see the other planes multiple times every day.

 - Stop trying to placate the politicians. It's very clear that UA has lost support in the current administration. They shouldn't spend any time trying to get it back. Worrying about Annise Parker is a distraction from the goal of building their brand.  Let Parker be Parker, worry about making United a good airline again.

As I stated earlier, there are significant portions of their customer base that UA is not going to see on their planes for a while, but there are new travellers who will be willing to board UA metal provided the service is top-notch.  I consider the angry, bitter Houston traveller a lost cause, I think that UA should as well.  I've got a flight coming up to Anchorage later this month, I have high hopes for it because my expectations are where they should be.  With my status I should get econ +, I'm bringing my own food on board and I'll have my iPad loaded with two or three movies.  I'm handling the food and entertainment, I just want United to get me their safely and on-time.

That shouldn't be too much to ask.

The rapid erosion of lower-tier elite airline status

Good article yesterday in The Middle Seat, the Wall St. Journals travel blog....

Silver Status Loses its Luster for Frequent Fliers. Scott McCartney, WSJ.com

Airlines have cut and crimped perks awarded to the silver-level frequent fliers—the lowest and most populous tier of elite status, which typically requires 25,000 flying miles a year.

Both travel message boards have threads going as well.

Flyer Talk (not much conversation here)

Mile Point (A little more conversation, and where I first found the story)

Conversation around this has been bubbling up on message boards for a while now, especially with United Airlines who overhauled their Premier program post merger, although the changes weren't as bad as some feared.

My position on this for a while now is that anyone who is comfortable qualifying for Silver Elite would be better served getting a credit card and taking advantage of the benefits that way, instead of flying 25K miles or 30 segments to qualify through the airlines.  This also allows you the option of choosing another airline at a lower cost without the opportunity cost of lost qualifying miles.

That's for the Silver (or lowest) level, what about the levels above?  This little tidbit caught my eye:

Even gold has lost some value. Steve Heller has lifetime gold status on United but found that it wasn't high enough to avoid some of the pitfalls of weakened elite status. His travel agent found two first-class seats to Bangkok for Mr. Heller and his wife priced at 140,000 miles round-trip. But gold status wasn't high enough to book those first-class saver awards. He could get two business-class seats for 120,000 round-trip—still a bargain, he figured.

"I called and they said, 'Your level allows business, but you can't get first on that flight,' " said Mr. Heller, a retired scientist from the Washington, D.C., area. "I discovered what a low-level person I am."
United confirmed that it gives better access to business-class and first-class "saver" awards to its top two tiers—Platinum and 1K—of its four-tier MileagePlus program. "In developing the MileagePlus program, members consistently emphasized the need to create distinction between the Premier-branded levels. This is one of those distinctions," a United spokesman said.

I can't help but wonder which "members" emphasized the need to create distinction?  It certainly wasn't the Gold and Silver members who are now relegated to second class citizenship under the new rules, and I doubt many Platinum and 1K members were really all that put out about it.  I have a feeling the "members" that really mattered were on the executive floor in Chicago.

Of course, all of that exclusivity goes out the window (especially on upgrades) when a lower-level elite decides they're going to by a full-fare (Y or B) economy ticket and then try and upgrade.  With United the first qualifier is NOT elite status level, but the amount of money you're willing to spend.  So a Plat or 1K on a S fare could find themselves (potentially, not likely because they can clear earlier however) losing out to a Silver Elite on a Y or B fare.  For all of United's talk about distinctions, what this really boils down to is a slow creep by the airlines to revenue based Elite programs.

What the airlines have come to understand is that loyalty is not a profit engine.  In today's hyper-competitive world many FF'ers are looking for price and value and will jump for a status match once an offer comes along that's to their benefit.  There is no real loyalty these days in the airline business.

I think it will be a long time before the upper-tiered loyalty program members realize a serious devaluation in their plans however.  But it is coming.  I predict that it won't be long until a bank figures out there are people out there who want a card that pushes them up to a level of equality with the top elite levels.  Granted, they will probably have some pretty high annual fees but customers will be willing to pay those in return for upgrades, F class award bookings etc.

Some pundits have speculated that we're starting to see the beginning of a sea change in how airlines treat their customers, especially those who, in the past, have been courted as being the 'most loyal'.  I really think that we've moved past the beginning into the implementation phase of several of these changes.  We've already seen the devaluation of the Silver level, now the perks are creeping into the next (Gold) tier, and I don't think it will be long before you see the third tier (Platinum) start to be encroached upon as well.

Airlines will, for the foreseeable future, continue to operate their FF plans and they will still provide the customer some small advantage (they will still, inevitably, market these programs as being 'more valuable than ever before' this will be, of course, not true), but the size of that advantage is going to get smaller and smaller as airlines move away from a loyalty-based plan and toward a revenue-based plan.  It's possible that customer outcry could stem this tide for a small time but I doubt it.  The box has been opened, there's little chance of closing it again. The best strategy now is to figure out how to best position yourself for the coming change.

Short Haul Flights (08/08/2012)

Whether or not these are interesting is up to you.....

Chesapeake shuns gas, shrinks rig count. Zain Shauk, Chron.com  - The issue is price and profitability.  On the latter, there is none.

Texas fracking disclosure law leaves questions. Dan X. McGraw, Chron.com - It wasn't too long ago that this same publication was holding up Texas laws as a "model".  Amazing how quick the ecomental lobby can change their minds.

Report: American/U.S. Airways merger raises anti-trust, consumer concerns. Sheryl Jean, DMN - The same is "reported" on almost every merger. It rarely means much.  Probably the biggest argument against this is that American doesn't seem to want to.

American Express Gold Card 75,000 point bonus. Gary Leff, View from the Wing - There's been a LOT of talk on travel message boards about posts like this (for an extreme example, search 30,000 Starwood points and see how many hits you get) and questions of rather or not they "ruin" travel blogging.  To my mind these posts aren't the biggest problem with travel blogging today, which I've outlined here and here.

Belafonte: Mitt's not my cup of tea. Caitlen McDevit, Politico - A lefty, has been celebrity doesn't like Mitt Romney, in related news it's hot in Houston during August.  (The media has NOT distinguished themselves in election coverage this year, on either candidate.)

Dome vote is far away. Chris Moran, Chron.com - Not as far away as anything resembling leadership on this issue.  That's strike two for Emmett FWIW.

Texas executes man despite concerns over IQ. Allan Turner, Chron.com From the story:

Marvin Wilson, the two-time armed robber who fatally beat and shot a Beaumont police informer

I, for one, am glad that stupidity cannot be used as a defense for a heinous crime in Texas.

Bicyclist killed in NE Houston traffic accident. Carol Christian, Chron.com - Remember stories like these the next time you hear the idiots at Houston Tomorrow longing for more people commuting to work on their bikes.  Bike paths?  Yes. Bikes w/cars during rush hour?  Obviously not.

And finally....

Train Spotter. The Apple Dumpling Gang, Chron.com - You have to give the gang this, no matter how wrong-headed they are, no matter how large the price-overruns become, no matter how impractical or useless the toy train is turning out to be, they're willing to be wrong until the bitter end.  Much to be admired.

A concerning travel blog development

I admit my relative rookie status when it comes to travelling, and travel blogging, but I've noticed a couple of posts over the last few days by some of the large travel bloggers that leave me scratching my head.

1. Using hidden city and throwaway ticketing to save big money on airfare, Gary Leff, View from the Wing

Airlines often price tickets from one city to another through a hub cheaper than flights that terminate at the hub. Flying United New York to Milwaukee through Chicago is often much cheaper than just flying New York to Chicago.

But if you get off the plane in Chicago and don’t board your connection to Milwaukee, you’ve potentially saved yourself a lot of money. This is called hidden city ticketing.

The post goes on to say that this is in explicit violation of the contract of carriage.

2. How to game elite status matches. Scottrick, Hack my Trip.

As with all travel hacking, there is a range of ethical dilemmas. Using free status and a single hotel night isn’t exactly the same as earning that status the hard way. But if it works, it works. You could also *cough* outright lie. Adobe makes products that can be used for good and for bad. It would be difficult but possible to use Photoshop to digitally edit your account statement pixel by pixel. 

It’s even easier to just print your account statement to PDF and then alter it using Acrobat Professional. The PDF will be divided into art and text, and the text remains fully editable in the same font and size, making it not that hard to delete “Silver” and write in “Platinum” or turn 0 points into 100,000. I’ll leave you to decide how far you want to take this. For my part, I’ve been able to avoid such extreme moves thus far.

By any measure this bit of "advice" is shocking.

I've had (brief) discussions about this with "real life" friends and we all agree that both of these examples are beyond the pale when it comes to giving out travel advice.  In the first, you're explicitly violating the contract of carriage between yourself and the airline.  You may not like those terms, but when you purchase a ticket you explicitly agree to follow them.  In the second the blogger is describing a way to blatantly commit fraud.

To my mind there's a big difference between "playing the miles game" and engaging in behavior that you know is unethical or illegal.  When an airline mistakenly loads a $62 R/T fare from IAH to ORD, you know they've made a mistake, but it's not fraudulent to take them up on an offered price, even IF that price is ridiculously low.  If anything it suggests a need for them to add some redundancy into their price loads each week.   I feel the same way about fuel dumps, or 3rd strikes, which utilize a loophole in the airlines software to induce a lower fuel surcharge.  Unlike the 1st example above, these are NOT against the contract of carriage and (because of their ability to shave hundreds of dollars of Intercontinental flights) are a loophole that the airlines are working mightily to close.

One thing that neither blogger mentions are the potential ramifications that could stem from following their "advice".  In the first situation you could be banned from an airline.  Gary says this is not a big deal because many flyers have no loyalty anyway are are "looking for the best price".  This logic is flawed because, if you disqualify yourself from an airline, you lose an awful lot of pricing power.  Depending on your residence this could be disastrous. (getting banned from UA would be very detrimental to someone who flies out of IAH or EWR for example) Secondly, there's the problem of losing any frequent flyer status and the corresponding hard-earned (for the most part I'm assuming) miles.  Airlines are within their rights to shut down your accounts, revoke any and all status and strip you of your miles.  They remain (and always will remain) the property of the airline.

The last drawback is the most obvious:  Fraud, committed knowingly, is a FELONY.  I'm not sure of the actual jurisdiction but I would imagine if you cross state lines this becomes a federal felony. (Possibly one of my attorney readers could correct me in the comments?)  Are you sure you want to take that risk to save a few bucks?

Irrespective of the legal ramifications I find it incredibly unprofessional of these bloggers to write in this manner. Advocating for travellers (in some cases, novice travellers) to behave in this manner doesn't advance travel writing in any way.  If anything it erodes credibility.  On all levels this is worse than the "LOOK AT THIS CREDIT CARD DEAL" that travel bloggers are constantly posting (sometimes with very weak acknowledgement that they profit from these arrangements) because, at least, those posts are 100% legal.

I'm a firm believer in the art of leveraging miles and points to save money on travelling, and to work as hard as you can to qualify for the highest status possible while spending the least amount of dollars.  My one caveat is that you have to conduct your business in an ethical and legal manner.

What I'm seeing on the travel blogs lately does not clear either of those hurdles, and that's disconcerting.


After I wrote all of this (but before publishing) this surfaced:

Travelocity cancelling reservations made with $200 off coupon. Gary Leff, View from the Wing

Commenter Mad Mad Mad shares the text of Travelocity’s cancellation email:

Recently you booked a vacation package at http://www.travelocity.com using the promo code NFB2012. Based on our review of the details of your reservation, we have determined that you were not eligible to use the promo code and, therefore, we have cancelled your reservation.
If you received the promo code when you attended the 2012 National Federation of the Blind National Convention in Dallas, and feel you have received this message in error, please contact us at 1-866-211-1731.
Sincerely,
Travelocity Customer Care Team

Except that nowhere in the terms and conditions does it say that one would have to have received the promo code by attending a Dallas event.
And in fact, that wasn’t Travelocity’s position when the coupon was introduced. They even tweeted publicly about it! Here’s a Google cache of their tweet:

This certainly doesn't fall under illegal and I'm not even sure it's unethical, but it sure feels gross doesn't it?

Texas Run-off winners and losers

By now you've probably heard the news regarding Ted Cruz lopsided win over David Dewhurst and you might have paid attention to some of the other races as well.  Whether or not this was a "change" election I'll leave to others to decide.  For one, Texas is the tip of the conservative spear in America, so what happens here doesn't necessarily transfer elsewhere, for two, there is still a general election to get through and while I think many races were decided last night, there could be some surprises.

Winners:

Ted Cruz: Obviously. Anyone saying that someone else was the big winner of the evening has an agenda, or is pulling for Paul Sadler. The simple fact is Ted Cruz faced withering personal attacks from Dewhurst and beat him by double digits.  The overall vote count in the race was somewhere around 1.1MM w/ Cruz taking around 680K of those votes.

The Anti-Incumbency movement:  On the Republican side, incumbents were the real losers.  Medina, Miller, Wentworth.  If you were an incumbent Republican you had a better than average chance of getting voted out.  Some consultants are already trying to spin this as having nothing to do with the Tea Party but they're paddling outside of the water.  This certainly was the Tea Party election, time will tell whether or not this volatile group can sustain their current momentum.

Indy Media:  There has been much better analysis and tea-leaf reading by bloggers & alt-media professionals on this race than anything being written by the so-called "experts" of the MSM (more on them later.)  If you're still going to your newspaper or Texas Monthly (although that's about to change w/their recent hiring of Josh Trevino) exclusively for your political opinion you're missing out.

Losers: (more of these than winners)

David Dewhurst:  Any list not mentioning him first is just wrong.  The sexy pick (for the MSM) is Rick Perry, but these have to be taken with a huge grain of salt because of personal vendettas.  Dewhurst had every advantage going into this race and he, for lack of a better term, blew it.  Already the sharks are in the water.  Jerry Patterson sent out a text saying that he "respected Dewhurst" but was running against him in 2014.  When he fell behind Dewhurst went scorched earth.  If that resonates then a candidate can emerge stronger.  If the voters reject it then there are a lot of hard feelings and the candidate is weakened.  David Dewhurst is a weakened candidate right now.  That said, voters can have short memories.

Stan Stanart:  This is a Harris County specific issue granted, but no elected official took it on the chin during the night quite like Harris County's Republican Clerk. During election night, the Clerk has one job. Post the election results accurately and timely. On the latter part, Stanart's shop failed.  And his excuses saying that "Reliant gave us some garbage lines" ring hollow considering he was slow during the first round of elections as well.  Stanart is one of the growing ranks of County politicians running for local, technical jobs using sweeping national rhetoric.  Perhaps it's time for the Republicans to find candidates who are willing to handle the requirements of the job for which they're elected first, BEFORE trying to save us from the evils of DC?

Paul Burka:  Ah Burka the clown.  What else can you say about a guy who authored four "live blog" election posts and couldn't even get the numbering sequence right.  I, II, IV, V  It's also funny to see Burka try and re-cast himself as calling it for Cruz from the outset. If anything, Burka called this race wrong early and has been trying to back-track every sense.  His analysis is hackery, too often propped up by uncorroborated "staffers" and little else.  He's a Selectric talking head in a digital world.  Texas Monthly was right to go and snag Josh Trevino to increase the credibility of their political opinion.  One last note: In his post mortem Burka casts Rick Perry as the "big loser" of the evening  That's bunk.  I'm going to name four people here that were bigger losers than Perry, and I'm not even going to touch on Straus, who seems to have taken another hit in his power base.  It's one thing to hold a personal grudge against an elected official as Burka (And Wayne Slater) seem to have against Rick Perry.  It's another to allow it to color every inch of your analysis.

JayDave* Carney:  Perry's rough political campaign, now a failure in the Dewhurst for Senate campaign.  Rough year.  It remains to be seen whether attack ads are on the out, or if Carney's shop just did a terrible job with the attack ads in THIS campaign.

At least they didn't hurt themselves:

The Texas Democratic Party:  I could call this a "win" given the recent past of this group, but when your nominee comes out and calls himself the "only major party nominee" for the US Senate and says that his opponent is outside of the mainstream, despite losing in the vote count by a total of 5-1, then really it's not a victory at all.  "Radical", "Crazy" and vulgarities are all the Democrats have right now.  I had a brief Twitter discussion with a Democratic talker last night discussing whether Cruz left them room to make a case.  I think there is room, but the State Democratic Party doesn't have the intellectual firepower to make it right now.  To compete in Texas the Dems need three things that they don't currently have:  Competent candidates (these take time to grow), a winning message (They haven't learned to play to the crowd) and better campaign consultants. (Good luck)  Whoever decided that Sadler coming out in his first big minute in the sun and insulting 680K Texas voters would be a good idea needs to be summarily dismissed from the campaign.  That won't happen, which is why they're going to get trounced (again) in November.



















*Thanks to Kevin Whited for pointing out my obvious typo. (not that Jay Carney would ever be termed a "winner".)