And she is still eating.
The news reports out of both MSP and ATL are very confusing. DL pilots exec is saying "Non" but their rank and file is not so sure. NW pilots say yes but only on their terms. The key issue is pilot seniority.
Breaking with objectivity here - I think it is dead because DL has not waited for the outcome to get on with their lives. Atlanta is offering severance to over 30,000 staff. With Delta's need for additional pilots already acute even the reduction in domestic flying is only going to delay the inevitable. There are more pilots needed.
This merger remains a bad idea. I cannot see it coming right. Frankly Wall Street has shown its ineptitude of late and therefore its push for this should be viewed in the context of a quick win for the traders and bottom feeders and bad news for the long term viability of the company (ok the 2 of them).
Boeing's Troubles with 787 Continue. This time its the Wing Box
This is one of those Oh Shit moments.
Boeing’s efforts to save weight on the 787 has resulted in a weakened central wing box, this is the core bit of the aircraft which effectively anchors the whole airplane.
First revealed in Public by ILFC’s Chairman Steven F. Udvar-Hazy
At the JPMorganChase Transportation Conference this week in his keynote speech and reported by Jon Osterow in the FlightBlogger this week the issue of a weakened wing box on the 787 was revealed. Most certainly this means a significant delay. Don’t believe that for a minute this is not a serious issue. It is and rightly Boeing is doing a lot to address it.
The impact will be significant on the production line with delays again not just in the first flight but also in the delivery schedule. Effectively we are now looking at a 2 year delay for Boeing to start deliveries from the pronouncements even last year at roll out day 7-8-07. For the early aircraft and the subsequent production line the impact on weight will be significant. Boeing’s hopes of a lighter 787 within spec have now been dashed. As with all aircraft this will have an effect either in range, lifting capacity or both. Having to strengthen the wing box means that the first aircraft off the line will be range constrained due to less fuel capacity. This is probably only a few percentage points but in the fine tuning of the aircraft it is something to watch. Hazy and many other purchasers are now setting their bean counters to calculate how much compensation is coming their way.
Sadly the work on the wing box was one of the brighter spots in the program. The Japanese have been scrupulously working to achieve all the goals that Boeing set them. I say again Boeing. PLEASE take the time to identify the issues and work them through. Boeing’s retreat into silence is a marked turnaround from their original open and transparent dialogue with the marketplace. Suggestion. Start holding regular briefings so people can know what is going on. Learn to manage not stifle the news.
Cheers
Timothy
Boeing’s efforts to save weight on the 787 has resulted in a weakened central wing box, this is the core bit of the aircraft which effectively anchors the whole airplane.
First revealed in Public by ILFC’s Chairman Steven F. Udvar-Hazy
At the JPMorganChase Transportation Conference this week in his keynote speech and reported by Jon Osterow in the FlightBlogger this week the issue of a weakened wing box on the 787 was revealed. Most certainly this means a significant delay. Don’t believe that for a minute this is not a serious issue. It is and rightly Boeing is doing a lot to address it.
The impact will be significant on the production line with delays again not just in the first flight but also in the delivery schedule. Effectively we are now looking at a 2 year delay for Boeing to start deliveries from the pronouncements even last year at roll out day 7-8-07. For the early aircraft and the subsequent production line the impact on weight will be significant. Boeing’s hopes of a lighter 787 within spec have now been dashed. As with all aircraft this will have an effect either in range, lifting capacity or both. Having to strengthen the wing box means that the first aircraft off the line will be range constrained due to less fuel capacity. This is probably only a few percentage points but in the fine tuning of the aircraft it is something to watch. Hazy and many other purchasers are now setting their bean counters to calculate how much compensation is coming their way.
Sadly the work on the wing box was one of the brighter spots in the program. The Japanese have been scrupulously working to achieve all the goals that Boeing set them. I say again Boeing. PLEASE take the time to identify the issues and work them through. Boeing’s retreat into silence is a marked turnaround from their original open and transparent dialogue with the marketplace. Suggestion. Start holding regular briefings so people can know what is going on. Learn to manage not stifle the news.
Cheers
Timothy
For True Airline Geeks Only
Want to hear the absolute latest spin on the US Airline Industry. Then go to this website and try and drink from the fire-hose of the JPMorgan Chase (and now Bear Sterns) Conference on the Transportation Industry the majority of which is airline related. It covers presentations held over 2 days.
However hurry because there are limitations on these - some expire in a few days all expire by June 23 2008.
Sadly you will miss Hazy's speech where he lays into Boeing about the 787 delays.
However hurry because there are limitations on these - some expire in a few days all expire by June 23 2008.
Sadly you will miss Hazy's speech where he lays into Boeing about the 787 delays.
21 March 2008
The Sad Story of the US Astronaut Corp
Once the proud standard bearers of a nation, the US Astronaut Corps is but a shadow of its true intent.
This piece on NPR's This American Lfe with Ira Glass perhaps shows what is wrong with the "American Way". It is shocking to me that the Shuttle Program will end in 2 years time. That we will have no US official manned space program between 2010 and 2020 at the earliest. The USA will have to rent access to the Space Station from the Russians.
Their main role these days - PR. The program dedicated to what? It is not clear.
Click the link to hear the story. The Bush Administration and NASA should be completely ashamed. Everyone should be saddened by this travesty
Say Aloha again to Chapter 11. More to come.
In the current issue of Air Transport World there is a great article to how everything is rosy in the garden of the US Airlines. One quote is from the very first sentence: "Incredible Turnaround' "On Jan 1 (2008) for the first time in six years, the US airline industry began a new year with no carriers operating under (Chapter 11) bankruptcy protection."
Clearly not for long.
Aloha airlines was first to jump pack entering court protection for the second time in under 2 years on March 20th. The result of the credit markets melt down and a complicated transaction involving United Airlines and Yucaipa - the holding company of Aloha Airlines. The stated reason of competition from Mesa's go! airlines is somewhat BS in my opinion. This was a screw up. Anyone who thinks UAL would make a good investor has been misreading the tea leaves.
We predict that this will not be a solo event in 2008. We already have another carrier on doom watch. If oil stays above $100/pbl (read above $2.70 for avgas) then this is for us a certainty that there will be others.
Sad but in our opinion true.
Thanks to AS and RE for contributions to this story.
Clearly not for long.
Aloha airlines was first to jump pack entering court protection for the second time in under 2 years on March 20th. The result of the credit markets melt down and a complicated transaction involving United Airlines and Yucaipa - the holding company of Aloha Airlines. The stated reason of competition from Mesa's go! airlines is somewhat BS in my opinion. This was a screw up. Anyone who thinks UAL would make a good investor has been misreading the tea leaves.
We predict that this will not be a solo event in 2008. We already have another carrier on doom watch. If oil stays above $100/pbl (read above $2.70 for avgas) then this is for us a certainty that there will be others.
Sad but in our opinion true.
Thanks to AS and RE for contributions to this story.
Buying an airline ticket using Paypal
I had the opportunity to use Paypal to buy my Southwest Airlines ticket for next week.
The experience should be relatively painless if it wasn't for some quirks in the Southwest website.
But there is one quirk you should know about if you use Paypal. It doesn't like American Express. So you will not be able to complete the transaction if you ONLY have Amex as the connection in your Paypal account.
Now that both Northwest and Southwest are promoting the activity (spend $250+ and get a $50 credit) the other airlines should join in.
And where is Google Checkout in all of this? MIA?
Cheers
Timothy
The experience should be relatively painless if it wasn't for some quirks in the Southwest website.
But there is one quirk you should know about if you use Paypal. It doesn't like American Express. So you will not be able to complete the transaction if you ONLY have Amex as the connection in your Paypal account.
Now that both Northwest and Southwest are promoting the activity (spend $250+ and get a $50 credit) the other airlines should join in.
And where is Google Checkout in all of this? MIA?
Cheers
Timothy
20 March 2008
US Airlines panic and yank on the handbrake
When I was a lot younger - I, (and many other young Brits) used to practice what we called "Handbrake Turns". In small English cars like an A40 or a Mini this was quite effective at dramatically changing direction of the vehicle. The US Airline group seem to be wanting that kind of change now.
There is just a blizzard of stories coming down the wires about how the US Airlines are falling over themselves trying to cut capacity.
Delta is telling everyone it is now "an international" airline and will cut dramatically its US point to point routes. Look for CVG to take a hit again. 3000 staff will be shed and many older aircraft idled. (With the 733s ad 762s now all gone that can only mean the MD88s of which some are already parked). And you can kiss that merger goodbye.
United is spreading doom and gloom everywhere. As it should - its in a very weak position
The list goes one with Alaska, Frontier and Jetblue also hastening departures from their fleets. For these 3 carriers these will be low time aircraft.
About the only one person who can be happy with this is Southwest. If everyone else panics and slashes capacity - then WN will benefit. Can you say Texas Hold'em?
Chaps - slashing your way to success is a poor strategy. Think about your businesses in totality. Slashing the US domestic feed spells trouble for Delta. Putting all your eggs in one basket (International) which is much more volatile and risk prone to me is a poorly thought out move.
Come back Jerry - all is forgiven.
There is just a blizzard of stories coming down the wires about how the US Airlines are falling over themselves trying to cut capacity.
Delta is telling everyone it is now "an international" airline and will cut dramatically its US point to point routes. Look for CVG to take a hit again. 3000 staff will be shed and many older aircraft idled. (With the 733s ad 762s now all gone that can only mean the MD88s of which some are already parked). And you can kiss that merger goodbye.
United is spreading doom and gloom everywhere. As it should - its in a very weak position
The list goes one with Alaska, Frontier and Jetblue also hastening departures from their fleets. For these 3 carriers these will be low time aircraft.
About the only one person who can be happy with this is Southwest. If everyone else panics and slashes capacity - then WN will benefit. Can you say Texas Hold'em?
Chaps - slashing your way to success is a poor strategy. Think about your businesses in totality. Slashing the US domestic feed spells trouble for Delta. Putting all your eggs in one basket (International) which is much more volatile and risk prone to me is a poorly thought out move.
Come back Jerry - all is forgiven.
They said they wouldn't but now they did. BA ups IB Stake
Despite having denied wanting to be part of the Iberia take over (still not consummated), BA has been quietly buying into Iberia. It has raised it's stake to 13.15% up from 10%. So why and why now?
Let's all speculate today. Its a slow news day in Europe, people are leaving early for their Easter Vacation. Your options are:
1. Its relatively cheap.
2. The EU consolidation race is hotting up again now the AZ race seems to have been resolved
3. TPG needs the help. There is not so much cash around to help Private Equity.
4. Olympic is too much of a basket case.
5. Because they can
6. I have no clue
7. The US consolidation season has ended and there is none so let's look at Europe
8. The real reason is ___________ (fill in the blank)
9. Some of the above
10. All of the above.
Answers please on 100 Euro bills.
Let's all speculate today. Its a slow news day in Europe, people are leaving early for their Easter Vacation. Your options are:
1. Its relatively cheap.
2. The EU consolidation race is hotting up again now the AZ race seems to have been resolved
3. TPG needs the help. There is not so much cash around to help Private Equity.
4. Olympic is too much of a basket case.
5. Because they can
6. I have no clue
7. The US consolidation season has ended and there is none so let's look at Europe
8. The real reason is ___________ (fill in the blank)
9. Some of the above
10. All of the above.
Answers please on 100 Euro bills.
19 March 2008
Is Air France paying too much for Alitalia?
Air France is buying Alitalia. A big sigh of relief goes up in Rome. A challenge will be filed from a certain building not a million miles from Dublin Airport. But is M. Spinetta (isn't that an Italian sounding name?) paying too much? Probably not for dominance.
But the price to be paid is not for the intrinsic value of the business - it is so someone can save face.
Alitalia will require a massive investment program. At a time when airlines operating costs are going through the roof. One could argue - if one was a French Trade Unionist - that the investment in AZ could be much better served in paying more money to AF workers.
A resurgent Alitalia could provide a much needed boost to the Italian economy. I am not so sure that the new EC entrants are going to be happy about that. Why is this important? Because when the issue of alleged illegal state aid for AZ finally wends its way before the commission it may just end up in front of a not so happy administrative law judge.
But the price to be paid is not for the intrinsic value of the business - it is so someone can save face.
Alitalia will require a massive investment program. At a time when airlines operating costs are going through the roof. One could argue - if one was a French Trade Unionist - that the investment in AZ could be much better served in paying more money to AF workers.
A resurgent Alitalia could provide a much needed boost to the Italian economy. I am not so sure that the new EC entrants are going to be happy about that. Why is this important? Because when the issue of alleged illegal state aid for AZ finally wends its way before the commission it may just end up in front of a not so happy administrative law judge.
There is a recession - just ask Las Vegas
The old slogan used to be "What happens in Vegas stays in Vegas." However now it seems that getting anything to happen in Vegas is a stretch. The new Las Vegas slogan is "Your Vegas is showing" although you might be confused if you think the slogan is VEGAS RIGHT NOW. Either way there is very little action going on. And what here is - is definitely down.
However I digress....
The news is bad.
Here are the results from January in Las Vegas as reported in Travel Weekly USA.
LAS VEGAS VISITOR STATISTICS were released last week for January, and the numbers were down across the board. According to a report from the Las Vegas Convention and Visitors Authority, visitor volume dropped 0.6% compared with January 2007, the largest decline in visitor volume in 12 months. Total convention attendance was 677,978 for the month, the weakest start of the year for convention numbers since January 2002, just after 9/11. January occupancy levels dropped 0.5% year-over-year. Gaming revenues for Clark County were down 4.1%. The total number of passengers passing through Las Vegas' McCarran International Airport dropped by 2.8% in January, on the heels of a 2.5% decline in November and a 3.2% drop in December, marking the first decline in numbers of passengers through McCarran since August 2003. And the average daily auto traffic on major highways into Las Vegas was 74,399 vehicles in January, the lowest number in three years.
Ouch...........
No one wants to party it would seem. Except perhaps Eliot Spitzer.
Cheers (I hope)
Timothy
However I digress....
The news is bad.
Here are the results from January in Las Vegas as reported in Travel Weekly USA.
LAS VEGAS VISITOR STATISTICS were released last week for January, and the numbers were down across the board. According to a report from the Las Vegas Convention and Visitors Authority, visitor volume dropped 0.6% compared with January 2007, the largest decline in visitor volume in 12 months. Total convention attendance was 677,978 for the month, the weakest start of the year for convention numbers since January 2002, just after 9/11. January occupancy levels dropped 0.5% year-over-year. Gaming revenues for Clark County were down 4.1%. The total number of passengers passing through Las Vegas' McCarran International Airport dropped by 2.8% in January, on the heels of a 2.5% decline in November and a 3.2% drop in December, marking the first decline in numbers of passengers through McCarran since August 2003. And the average daily auto traffic on major highways into Las Vegas was 74,399 vehicles in January, the lowest number in three years.
Ouch...........
No one wants to party it would seem. Except perhaps Eliot Spitzer.
Cheers (I hope)
Timothy
18 March 2008
Be Careful Delta - What you wish for may actually happen.
Delta offers voluntary severance to 50 percent of all employees.
Wait that's 50%????
According to a story posted on WSJ.com this is what Delta is offering. a 5% cutback of domestic flying (in addition to their 11% last year). That is a pretty significant change and represents a major shift in the staffing of the airline. However this comes at a time of difficulty. Clearly we don't know the terms but there is a looming shortage of Pilots in the US and in particular at Delta.
I doubt we will see this replicated across the board but I do believe that airline lemming mentality will cause some of the other airlines to do something similar. A warning though goes with this. If you don't take the severance package, then your job is not safe.
These are exciting if not scary times.
Wait that's 50%????
According to a story posted on WSJ.com this is what Delta is offering. a 5% cutback of domestic flying (in addition to their 11% last year). That is a pretty significant change and represents a major shift in the staffing of the airline. However this comes at a time of difficulty. Clearly we don't know the terms but there is a looming shortage of Pilots in the US and in particular at Delta.
I doubt we will see this replicated across the board but I do believe that airline lemming mentality will cause some of the other airlines to do something similar. A warning though goes with this. If you don't take the severance package, then your job is not safe.
These are exciting if not scary times.
They are falling like flies.... for Amadeus
SAS is falling for Amadeus. After pronouncing words in private that sounded like hell would freeze over before they would let themselves fall into the Amadeus camp, Robin Kamark has indeed signed a deal with Amadeus.
So another one bites the dust. Now will Amadeus finally step up to the plate and bring on more resources to accommodate all these airlines?
Let's hope so for the customers sake.
Cheers
Timothy
Here is part of the PR.
The SAS Group has signed a letter of intent with Amadeus, one of the leading suppliers of global distribution systems and IT solutions in the airline industry.
The letter of intent means that parts of the SAS commercial IT platform will be replaced. These include sales, booking, ticketing, check-in and load-control. The new and modern systems are standardized and easier to use, in addition travel agencies will be able to access the lowest fares with SAS through Amadeus.
"This letter of intent provides the SAS Group the possibility to offer our customers innovative solutions during the years ahead. It will be easy to find a good-value alternative. In addition, the agreement will include considerably reduced distribution costs," said Robin Kamark, Senior Vice President, Airline Commercial, SAS Group.
"This has been a long process and we are now looking forward to the next step in this expanded cooperation."
So another one bites the dust. Now will Amadeus finally step up to the plate and bring on more resources to accommodate all these airlines?
Let's hope so for the customers sake.
Cheers
Timothy
Here is part of the PR.
The SAS Group has signed a letter of intent with Amadeus, one of the leading suppliers of global distribution systems and IT solutions in the airline industry.
The letter of intent means that parts of the SAS commercial IT platform will be replaced. These include sales, booking, ticketing, check-in and load-control. The new and modern systems are standardized and easier to use, in addition travel agencies will be able to access the lowest fares with SAS through Amadeus.
"This letter of intent provides the SAS Group the possibility to offer our customers innovative solutions during the years ahead. It will be easy to find a good-value alternative. In addition, the agreement will include considerably reduced distribution costs," said Robin Kamark, Senior Vice President, Airline Commercial, SAS Group.
"This has been a long process and we are now looking forward to the next step in this expanded cooperation."
17 March 2008
Such a deal - Paypal: Southwest and Northwest $50 off.
To kick-start usage of Paypal as a form of payment - EBAY has partnered with both the 'wests' to offer $50 off any purchase of $250 or more.
Given the lackluster acceptance so far this is good news. Akin to the Mastercard promo with the launch of Priceline.
Paypal should benefit but the airlines should ultimately benefit more. What's missing, or rather WHO is missing is Google's Checkout. Why aren't they in the game yet. Hello - Sergey and Larry - stop playing with your 767 and get with the program here.
Cheers
Timothy
Given the lackluster acceptance so far this is good news. Akin to the Mastercard promo with the launch of Priceline.
Paypal should benefit but the airlines should ultimately benefit more. What's missing, or rather WHO is missing is Google's Checkout. Why aren't they in the game yet. Hello - Sergey and Larry - stop playing with your 767 and get with the program here.
Cheers
Timothy
IAPA sees the light - Yes Amadeus is airline controlled (maybe)
Couched in respective terms the BTC Press release (below) shows that the passenger groups are beginning to understand that there is a hidden impact to the new proposed CRS rules from the EC.
Users and consumers (Agencies and travellers) need to pay attention to the new rules which provide a wide open door to abuse by airlines owning GDS entities. In this case the only player impacted is Amadeus. Where I believe the EC did not address enough attention is in the quasi GDS environment of airline hosting.
You read and be the judge.
Cheers
Timothy
Press Release
London, UK, March 17, 2008
FOR IMMEDIATE RELEASE
IAPA fears European CRS Code of Conduct review will lead to higher fares
The European Parliament is currently considering revisions to the CRS (Computer Reservations System) Code of Conduct proposed by the European Commission.
Although the principles of the revised Code of Conduct remain solid and seem to afford protection to consumers regarding neutrality and transparency of information presented on CRS, there is a potentially fatal flaw which could result in higher fares.
The flaw is that the Code of Conduct could effectively be rendered impotent by a new interpretation of the term “parent carrier”. This term has always been understood to apply to airlines that own a share of a CRS, and the Code has key restrictions on such airlines’ behaviour to prevent them from introducing bias to the CRS display that would favour their own flights.
Now IAPA understands that what constitutes a “parent carrier” could be interpreted (for the first time) as excluding the key airlines Lufthansa, Air France and Iberia which, between them, own 46% of Amadeus, the leading CRS in Europe.
The implications of this are that these airline would no longer be constrained by the restrictions of the Code, and travel agents, consumers and competitive airlines alike would have to rely on those airlines’ good nature and sense of fair play to ensure that CRS flight listings remain neutral and unbiased.
If this proves not to be enough, these airlines could squeeze competitive flights and fares off the crucial first page of results from travel agents’ CRS displays and some key internet travel sites, allowing them to increase their own fares. Meanwhile, the worthy clauses of the Code of Conduct, which have served travel agents and airline passengers well for nearly two decades, would gather dust on the shelves.
IAPA is calling on all MEPs to ensure that the intentions of the Code are honoured in practice and not just on paper, and to ensure that a level of ownership of 46% is actually recognised as leading to the potential for influence.
End
Users and consumers (Agencies and travellers) need to pay attention to the new rules which provide a wide open door to abuse by airlines owning GDS entities. In this case the only player impacted is Amadeus. Where I believe the EC did not address enough attention is in the quasi GDS environment of airline hosting.
You read and be the judge.
Cheers
Timothy
Press Release
London, UK, March 17, 2008
FOR IMMEDIATE RELEASE
IAPA fears European CRS Code of Conduct review will lead to higher fares
The European Parliament is currently considering revisions to the CRS (Computer Reservations System) Code of Conduct proposed by the European Commission.
Although the principles of the revised Code of Conduct remain solid and seem to afford protection to consumers regarding neutrality and transparency of information presented on CRS, there is a potentially fatal flaw which could result in higher fares.
The flaw is that the Code of Conduct could effectively be rendered impotent by a new interpretation of the term “parent carrier”. This term has always been understood to apply to airlines that own a share of a CRS, and the Code has key restrictions on such airlines’ behaviour to prevent them from introducing bias to the CRS display that would favour their own flights.
Now IAPA understands that what constitutes a “parent carrier” could be interpreted (for the first time) as excluding the key airlines Lufthansa, Air France and Iberia which, between them, own 46% of Amadeus, the leading CRS in Europe.
The implications of this are that these airline would no longer be constrained by the restrictions of the Code, and travel agents, consumers and competitive airlines alike would have to rely on those airlines’ good nature and sense of fair play to ensure that CRS flight listings remain neutral and unbiased.
If this proves not to be enough, these airlines could squeeze competitive flights and fares off the crucial first page of results from travel agents’ CRS displays and some key internet travel sites, allowing them to increase their own fares. Meanwhile, the worthy clauses of the Code of Conduct, which have served travel agents and airline passengers well for nearly two decades, would gather dust on the shelves.
IAPA is calling on all MEPs to ensure that the intentions of the Code are honoured in practice and not just on paper, and to ensure that a level of ownership of 46% is actually recognised as leading to the potential for influence.
End
CarRentals.co Acquired by Expedia
Congrats to David and the crew over in my startup in the bedroom aka CR.com
This shows that Expedia is in need of some revenue fixes or is intent on closing gaps in its product line - probably both.
There are not that many places for an intermediary to make money. Airline revenue is practically zilch, Hotels are falling, Cruise is a mirage so Cars is about all that's left in the single supply line. Of course opaque packaging and ancillaries still look the most promising.
This shows that Expedia is in need of some revenue fixes or is intent on closing gaps in its product line - probably both.
There are not that many places for an intermediary to make money. Airline revenue is practically zilch, Hotels are falling, Cruise is a mirage so Cars is about all that's left in the single supply line. Of course opaque packaging and ancillaries still look the most promising.
Blog Number 300
Now we feel really old. This is the 300th Blog entry from T2Impact. We should have a glass of champagne or something to celebrate.
Truth is however there is a lot of doom and gloom around. The US economy is in the toilet and Paulson and Bush seem to have no answer to the economic ills that face the current world’s largest economy. So rather than celebrate – we are going to use this occasion to stare into our crystal ball and look at the US Airline market. Despite their best year ever – profits and passenger wise. There are basically many structural problems affecting the market. Not content with taking a neutral position – some of the leading analysts – Jamie Baker at JPMorganChase and the S&P guys are being active in marking down the US airlines.
Why are we seeing this now? The trigger has for sometime being the buildup in the cost side of the airlines economic equation. The run up to $100/barrel oil did nothing to slacken the pace of airline price increases and consumer appetite for airline services. Indeed as we reported earlier this year the 2008 holiday season looks very bright based on the January Caribbean Hotel mart. But elsewhere the whole market looks miserable. We saw a distinct drop off in January traffic which seemed to echo the slowdown we saw from August of last year. In February we were surprised by a strong performance in the US market – we suspect March’s traffic reports (airport movements) will go soft again. Airlines are going to start pulling capacity again. Hopefully they will to remain healthy.
On a brighter note – I would like to thank all of you for your support and assistance in delivering this milestone. When we first started writing seriously from last year – I was still a skeptic about the whole blog movement. However now we have been doing this for some time – I for one am a convert and an ardent fan. However we do hope that people realize that there has to be a code of conduct and that sooner or later one will be published. Publish and be Damned still comes at a price. We have no aspirations of being a Matt Drudge.
Thank you for all your comments – public and private. They actually do help us to focus our efforts. Finally thanks to the unseen people who use the information for their improvement! We hope that this blog will continue to be helpful to everyone. Given that the lads and lasses at T2 all have day jobs – and your truly does too – it is a wonder sometimes that we get any time to write. But we will continue to publish while you continue to read.
And it’s a good night from him
timothyo@t2impact.com
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
www.t2impact.com
Truth is however there is a lot of doom and gloom around. The US economy is in the toilet and Paulson and Bush seem to have no answer to the economic ills that face the current world’s largest economy. So rather than celebrate – we are going to use this occasion to stare into our crystal ball and look at the US Airline market. Despite their best year ever – profits and passenger wise. There are basically many structural problems affecting the market. Not content with taking a neutral position – some of the leading analysts – Jamie Baker at JPMorganChase and the S&P guys are being active in marking down the US airlines.
Why are we seeing this now? The trigger has for sometime being the buildup in the cost side of the airlines economic equation. The run up to $100/barrel oil did nothing to slacken the pace of airline price increases and consumer appetite for airline services. Indeed as we reported earlier this year the 2008 holiday season looks very bright based on the January Caribbean Hotel mart. But elsewhere the whole market looks miserable. We saw a distinct drop off in January traffic which seemed to echo the slowdown we saw from August of last year. In February we were surprised by a strong performance in the US market – we suspect March’s traffic reports (airport movements) will go soft again. Airlines are going to start pulling capacity again. Hopefully they will to remain healthy.
On a brighter note – I would like to thank all of you for your support and assistance in delivering this milestone. When we first started writing seriously from last year – I was still a skeptic about the whole blog movement. However now we have been doing this for some time – I for one am a convert and an ardent fan. However we do hope that people realize that there has to be a code of conduct and that sooner or later one will be published. Publish and be Damned still comes at a price. We have no aspirations of being a Matt Drudge.
Thank you for all your comments – public and private. They actually do help us to focus our efforts. Finally thanks to the unseen people who use the information for their improvement! We hope that this blog will continue to be helpful to everyone. Given that the lads and lasses at T2 all have day jobs – and your truly does too – it is a wonder sometimes that we get any time to write. But we will continue to publish while you continue to read.
And it’s a good night from him
timothyo@t2impact.com
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
www.t2impact.com
16 March 2008
"Delivering Proactive Customer Service" Southwest
Southwest has been severely slapped over the maintenance issues regarding inspections in older model Boeing 737s in its fleet. It ended up grounding several planes on March 12th and providing some disruptions to its regular operations.
Coincidentally I actually flew that day on Southwest. As I opened the in-flight magazine my eye was drawn to the lead piece from Colleen Barrett, President of WN. The title was "Delivering Proactive Customer Service".
At the end of the day - I did get interrupted and yes my flights were late - ending up over an hour late at my destination. As an LCC - Southwest relies on its customers to make their own decisions. In my case - specifically it could have done a better job to help me make a decision. Take the connection or wait for the next direct (but stopping) flight. Was Southwest proactive? Actually no. Nor for many other passengers who were in a similar situation. For Southwest, there is a lesson here. Pass on that "Proactive" attitude to the local teams. They have the ability to make something happen and they could actually do something about helping passengers make good decisions.
Lets hope that WN learns something from this experience. It definitely needs to arm its customers with better information and better capability to know the extent of the issues facing it.
One other thing I noted. The legendary pitch in and help spirit seems to be taking a back seat. There were 2 SWA employees (flight crews) who were sitting around waiting for pass rider travel. Neither stepped in to help. They could have and should have. Perhaps if the passengers had been more restless they would have.
Cheers
Timothy
Coincidentally I actually flew that day on Southwest. As I opened the in-flight magazine my eye was drawn to the lead piece from Colleen Barrett, President of WN. The title was "Delivering Proactive Customer Service".
At the end of the day - I did get interrupted and yes my flights were late - ending up over an hour late at my destination. As an LCC - Southwest relies on its customers to make their own decisions. In my case - specifically it could have done a better job to help me make a decision. Take the connection or wait for the next direct (but stopping) flight. Was Southwest proactive? Actually no. Nor for many other passengers who were in a similar situation. For Southwest, there is a lesson here. Pass on that "Proactive" attitude to the local teams. They have the ability to make something happen and they could actually do something about helping passengers make good decisions.
Lets hope that WN learns something from this experience. It definitely needs to arm its customers with better information and better capability to know the extent of the issues facing it.
One other thing I noted. The legendary pitch in and help spirit seems to be taking a back seat. There were 2 SWA employees (flight crews) who were sitting around waiting for pass rider travel. Neither stepped in to help. They could have and should have. Perhaps if the passengers had been more restless they would have.
Cheers
Timothy
So the protest goes in - Now what?
Boeing - playing sore looser - has filed a a formal protest against the award of the Boeing Tanker contract to Northrup Grumman based on Airbus's A330.
Automatically the review will be conducted by the GAO. It has 100 days to review and then a possible further round could add another 100 days to the protest. This is highly likely given that Boeing will likely protest again unless of course they win in which case Northrup will likely protest.
In the mean time the Air Force has to put up with an ageing fleet of Tankers whose average age is now 40 years plus. Kudos to Boeing for building a product that has been so successful.
As a US taxpayer, I am loathe to see this process go further. We all want to see the USAF get its new tankers and for the rest of the world to get on with it.
My wish? Boeing to cooperate with NG and become a contractor to the project. NG could definitely do with some help. Airbus has a significant hill to climb with some of its other projects.
Lets hope the USAF got their numbers and criteria right in the award. If not then we should all feel concerned that the procurement process for US military is (as I believe) deeply flawed. This should be a priority to review for the next US Administration.
Cheers
Timothy
Automatically the review will be conducted by the GAO. It has 100 days to review and then a possible further round could add another 100 days to the protest. This is highly likely given that Boeing will likely protest again unless of course they win in which case Northrup will likely protest.
In the mean time the Air Force has to put up with an ageing fleet of Tankers whose average age is now 40 years plus. Kudos to Boeing for building a product that has been so successful.
As a US taxpayer, I am loathe to see this process go further. We all want to see the USAF get its new tankers and for the rest of the world to get on with it.
My wish? Boeing to cooperate with NG and become a contractor to the project. NG could definitely do with some help. Airbus has a significant hill to climb with some of its other projects.
Lets hope the USAF got their numbers and criteria right in the award. If not then we should all feel concerned that the procurement process for US military is (as I believe) deeply flawed. This should be a priority to review for the next US Administration.
Cheers
Timothy