16 June, 2006
Our annual fundraising drive has smashed through its target of 500 contributors. As of Thursday night, 561 readers have chosen to contribute. We've had more readers choose to contribute this year than last, and we've also had a higher percentage of readers contribute, albeit by a very small margin.
There are still, of course, some 20,500 readers who haven't contributed, but I see my glass as half full on that point too. I know some readers can't conveniently contribute, and the generosity of the 561 makes it possible to continue to offer everything on the website and all the newsletter for free. So thanks to the 561, both from me, and on behalf of the other 20,500 too.
I'll not be prominently featuring the never-ending need for funds again until the next fundraising drive rolls around, but may I leave you with two final thoughts :
Firstly, it is never too late to contribute. All the appreciation gifts remain available so if you've been out of town or simply never quite got around to responding, you can still contribute and get full benefit in return.
Secondly, I'm keen to secure weekly sponsorships for the site and newsletter. If your company has a product or service it would like to introduce to the newsletter readers and website visitors, let me know and I'll send details.
It seems to be a long time since I last read - and reviewed - a good book; my last review had the author 'referring the review to his attorney'. Happily, however, here's a great book for some light low-stress summer reading :
This Week's Feature Column : Travia - The Ultimate Book of Travel Trivia : With 650 travel related factoids, this book is both interesting and amusing, educational and approachable. After reading it you'll be able to impress and amaze your friends, and any time there's a lull in conversation you can leap up and offer some bizarre piece of data that will for sure get conversation flowing again.
Well, maybe I slightly exaggerate, but it's nice to find a good book to talk positively about.
Dinosaur watching : Reader Will is a very frequent American Airlines flyer. He writes in with two recent experiences. Firstly
Will was also taught a valuable lesson while waiting for his AA flight at La Guardia last weekend. Everything is our fault. Nothing is the fault of either airlines or airports. He writes
Customer (dis)service reminds me of my as yet unresolved Alaska Airlines problem. They delayed a flight four hours on 4 April, causing me to miss the main reason to travel and cancel my flight. I wrote to ask how it was they didn't discover their plane was unflyable until seconds before starting the engines, and why it took them two hours to confess the truth to the passengers.
Two and a half months later, they have yet to reply. But on 19 May (six weeks after my email to Alaska Airlines) reader Walt emailed them asking why they weren't replying to me. They've now replied to him, although still not to me.
Their reply to Walt, however, causes him to say 'the chances of their having me as a customer again has achieved zero probability with this response.' Their response, dated 6 June, said :
Being as how Walt had said in his email 'When I have a future choice I will avoid your airline unless it is the ONLY alternative and I have no choice but to travel.' it seems Alaska Airlines will be waiting a long time to welcome him aboard another flight.
Don't you love the way airline customer service reps can completely avoid answering the issue raised with them, while including nonsense boilerplate sentences that ignore the comments in the letter they're answering.
Delta asked its bankruptcy court to extend its reorganization plan deadline, saying it needed an additional four months to file the plan which is currently due on July 11. The court gave them six months, presumably just to make sure Delta's executives don't feel under any pressure at all. But whatever the delay, Delta says it won't affect its goal to emerge from bankruptcy sometime in the first six months of 2007.
I guess we'll have to wait and see on that.
Delta is re-hiring some of the pilots it had earlier laid off. This is a positive thing to announce, but even something as simple and positive as that needs to get chopped up in the PR mill, such that the press release was headed 'Delta Recalls Pilots to Support Network and Revenue Improvement Initiatives'.
As one commentator wryly observed, I'd have thought the pilots were being recalled to fly planes, not 'to support network and revenue improvement initiatives'.
Standard & Poor's revised its outlook for US Airways, lifting it from negative to stable. A 'stable' outlook means S&P doesn't anticipate any lowering of the airline's credit rating in the next two years. S&P feels that US Airways will do well for the rest of this year, notwithstanding higher fuel prices. The airline posted a first quarter profit and expects a full year profit as well.
Don't they know that rising jet fuel prices threaten the entire industry? When even a 'walking wounded' airline like US can make a profit in the face of higher jet fuel prices, surely no other airline can continue to blame jet fuel costs for their own losses.
Like most airlines, BA is reducing its free checked baggage allowance from 70 lbs down to 50 lbs. But at the same time it does this, it is adding two interesting twists.
The first interesting twist is allowing you to pre-pay excess baggage charges on their website. If you do this, you get a 20% discount off the at-counter fee.
The second twist is that BA is completely removing their weight restrictions on carry-on bags, with the only remaining condition being you must be able to lift your bags into the overhead compartment without help from the flight attendant.
ps : BA would like you to know it isn't lowering its weight per checked bag just so it can make more money. Oh no. It is doing this 'to comply with health and safety recommendations' - and apparently an overweight bag poses less of a health and safety risk if the passenger checking it pays an overweight bag fee.
Good news for the new all-frills (as opposed to no-frills) airline, Eos. The airline which operates an all first class configured plane on flights between New York and London (Stansted) said it broke even in May with a 60% load factor, and June is shaping up to be a better month.
It is good to see the airline headed towards profitability, and it is very good indeed to see it needs only a 60% load factor to break even.
Occasionally readers suggest the best solution to the air travel industry's woes is to re-regulate the airlines. Ask around and you'll always find someone who believes de-regulation should be blamed for the airlines' problems. As for me, I'm perfectly comfortable leaving the blame at the feet of the dinosaurs.
Here's a good article reporting on a recently released Government Accountability Office study that claims de-regulation has been a good thing for travelers, although a not so good thing for airline employees. The study also says that re-regulation, while undoubtedly harming travelers, is unlikely to benefit employees.
Key finding for most of us - in the last 25 years, expressed in 2005 dollars, airfares have dropped an average of 40%.
I've been one of Airbus' most ardent cheerleaders for the last several years, but it is becoming increasingly difficult to maintain this positive stance. Truly, companies go through cyclical periods of success and failure, and invariably the seeds of each phase can be found in the results of the previous phase.
Has Airbus now become complacent to the point of incompetence?
After the misjudged mishandling of its proposed A350 plane, which in its first form failed to win much marketplace acceptance, Airbus is now tripping over itself with its A380 super jumbo. The program has already suffered minor delays, but this week Airbus admitted there would be a major slippage in deliveries, with delays of up to seven months and only nine planes being delivered in 2007, down from an earlier target of 20 - 25. There'll be a further shortfall of 5 - 9 planes in 2008, and still more of a shortfall of about five planes in 2009. Worst case scenario - 30 fewer A380s will be delivered in the next 3.5 years. With each plane listing for about $300 million, this will have a massive impact on Airbus' corporate profitability.
And it sure won't help the airlines who have planned their future fleet needs around promised A380 deliveries. These A380s are essential for airlines flying into slot-limited airports such as Heathrow - the only way they can grow their capacity is to put bigger planes on the route, and if there are no bigger planes to be had, the airlines are stuck. In such a case, where they have less capacity than there is market demand, what would an airline rationally do? Yes - increase prices. So everyone is going to lose out on these delays, all the way to you and me.
Within hours of the announcement came an announcement from Singapore Airlines, the launch customer for the A380. SQ had been closely considering the purchase of either 787 or A350 planes. In a decision that was almost certainly linked to this bad news - certainly from a timing point of view if not also from a choice point of view, SQ said it has decided to buy twenty Boeing 787s rather than Airbus A350s.
The share market reacted very strongly to the delay, with Airbus losing a quarter of its value on Wednesday. But not all shareholders were equally disadvantaged when the share price went into freefall. By amazing coincidence, co-Chief Executive Noel Forgeard sold $3.1 million worth of options in mid-March, and three of his children each sold $1.75 million worth of shares in the same period.
By further coincidence, two board members also had sold large numbers of shares earlier in the year, and parent company EADS' co-chairman sold half of his 15% holding in the company.
We are told there are no suggestions of insider knowledge motivating these sales. Which is sure good to know, because without being reassured on that point, a not so well informed observer might really wonder....
While these delays do not substantially harm the viability of the A380, they sure do harm Airbus and the airlines that had been relying on Airbus to deliver their A380s on the timeframe promised.
Continuing my crusade for a balanced and rational approach to the debate on climate change, here's an interesting article that quotes, among others, Professor Bob Carter of the Marine Geophysical Laboratory at James Cook University in Australia. In commenting on the recent movie put out by Al Gore, he says 'Gore's circumstantial arguments are so weak that they are pathetic. It is simply incredible that they, and his film, are commanding public attention.'
Carter adds 'The man [Gore] is an embarrassment to US science and its many fine practitioners, a lot of whom know (but feel unable to state publicly) that his propaganda crusade is mostly based on junk science.'
Read the entire article. It has some very reassuring hard facts about the state of the planet.
Talking about politics and oceans, a business coalition has now formed in Alaska to defeat a measure on the ballot that would add $50 in taxes onto each cruise passenger visiting the state. The group, called Alaskans Protecting Our Economy, feel the extra $100 per couple (or more if there are children) could be enough to encourage people to look elsewhere for their vacation, and further point out that even if visitors still decide to cruise to Alaska, it could discourage spending within the state.
I wish them luck, but the concept of taxing non-resident visitors continues to gain popularity - an ironic outcome in a nation founded on its revulsion against taxation without representation.
This Week's Security Horror Story : Security screeners shut down Tallahassee's airport for three hours on Monday after believing they'd detected a homemade bomb in a passenger bag.
It was unfortunate they didn't first ask the passenger what the mystery objects in his bag were before inconveniencing every passenger scheduled to go through the airport for the next three hours. The bag's owner, the food editor for Saveur magazine, could have easily told them it was only a jar of honey alongside ordinary battery powered electronic gadgets.
The inspector general of the Department of Homeland Security issued a report on Wednesday that alleges airlines are underpaying the TSA an estimated $14.5 million in fees which they collect from passengers every year. The report recommended the TSA provide closer oversight of the airlines to ensure proper collection and remittance of passenger security fees. The TSA said it would make sure the airlines are audited to make sure they pay what they owe.
I guess that answers the question of 'what happens to the taxes I paid if I don't fly a sector of my ticket?'
The TSA will need to be more careful at getting all the money it is owed, because lawmakers this week rejected a measure to increase the fee we pay (in the form of a ticket surcharge) for their services.
But while the TSA is losing out on money that is dubiously theirs, they're not without dishonor themselves. Ever wonder what happens to the harmless items the TSA confiscates from you? The disposal of these items has become big business, and very profitable, as this article reports.
One of the least successful proposals in recent years has been the concept of a 'Registered Traveler' program, promising priority access to security screening to people who pay an annual fee of about $80.
There are lots of things to dislike about these programs, which are so bad that even the airlines themselves are arguing against them.
While ordinary law abiding passengers have to go through all the hassles of security screening to gain limited access to some parts of airports and planes, what about airport employees? Sure, we're told that all workers with access to sensitive/secured parts of the airport have undergone background and security checks, but how then to explain the arrest of 55 illegal immigrants who were working on a construction site in the secure area at Dulles this week? At least one of these illegals had a security badge granting him unescorted access to the tarmac.
What easier way for a terrorist to access an airport and its planes than by pretending to be an illegal immigrant? Even if the terrorist is caught, the 'catch and release' programs are unlikely to do anything more than briefly inconvenience and slightly delay his nefarious activities.
One of the most insidious factors that permits the growth of government intrusion into our lives is the claim that innocent people have nothing to fear and nothing to hide. Here's an excellent article by security guru Bruce Schneier that rebuts that notion.
As we get closer to this year's November elections, spare a thought for the increasing use of electronic voting machines. Sure - no hanging chads (remember them...). But there are also lots of potential downsides to such machines, because there is no physical marked paper 'audit trail' to return to in the case of dispute.
And now one of the major suppliers of electronic voting machines reassure us that their machines are secure, independent experts claim to have uncovered 'the most severe security flaw ever discovered in a voting system'. Details here.
Diebold defended the machines as being safe, saying that taking advantage of their vulnerability would require the participation of a dishonest election official, something they claim to be an impossibly rare scenario and therefore not worth worrying about.
If only that were true.
Thanks to reader Michael who passed on this story of how a businessman's flight to Manchester had a surprising outcome.
Thanks to reader Rose for spotting item number eight on Business 2.0's 2005 list of the 101 Dumbest Moments in Business.
Lastly this week, if you've enjoyed your read through the 3320 words of the newsletter, and the 1438 words of the feature review this week, please consider supporting this worthy publication and project.
Until next week, please enjoy safe travels
David M Rowell aka The Travel Insider
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