PlaneBuzz

Stunning news out this afternoon, as the Air Force announced that Airbus and Northrop Grumman have been awarded the $40 billion Air Force tanker deal.

According to the Air Force, the contract is for the right to build up to 179 tanker aircraft, to be called the KC-45A, for the Air Force.

"The tanker is our number one procurement priority right now," said Air Force Gen. Duncan McNabb in a press release about the deal. "Buying the new KC-45A is a major step forward and another demonstration of our commitment to recapitalizing our Eisenhower-era inventory of these critical national assets."

The KC-45A is expected to be able to provide refueling to both Air Force and Navy planes, while its predecessor, the KC-135, must be configured for one or the other before takeoff.

It was widely believed that Boeing held the edge in these negotiations. As one report said tonight, "Boeing officials must be feeling a little bit like the New England Patriots."

This award comes after a scandal involving  the revelation that a top Boeing official had conducted illegal job negotiations with an Air Force acquisition official who later joined the company broke in 2001 -- scuttling what was widely believed to be, at the time, a slam-dunk contract for Boeing.

One thing is for sure. Stars aren't the only thing falling on Alabama tonight. So are dollar bills. A big part of the Airbus pitch on this contract was the fact they would manufacture the aircraft outside of Mobile, AL.

Posted by Holly at 7:26 PM | Permalink | Comments (1)

Flight International reported today that American Airlines is investigating an incident Thursday in which the engine on one of its Boeing 777-200ERs apparently failed to respond to throttle commands for several seconds during an approach into Los Angeles.

The incident, at this point, sounds somewhat similar to the problem that caused a British Airways 777-200 to land short of the runway at Heathrow recently. Both aircraft were equipped with Rolls-Royce Trent 800 engines.

According to the column,

"The incident involved American’s flight AA299 from Miami and occurred at a height of around 2,000ft as the aircraft was descending to Los Angeles.

In an information statement to members, the Allied Pilots Association – which represents American Airlines cockpit crew – says the aircraft experienced a “hang-up” of its left-hand engine.

“The auto-throttles were on and the left engine hung at approach idle as the right engine accelerated normally,” says the association.

“It is believed that the left engine would not respond to throttle inputs for 10-15 seconds before finally responding and accelerating to the commanded thrust.”

All of American’s 777-200ERs are fitted with Rolls-Royce Trent 800 powerplants.

Maintenance personnel have downloaded the flight-data recorder information and will examine the fuel tanks and engine fuel filters for possible contamination. Tests will also be carried out on the electronic engine control."

Posted by Holly at 5:49 PM | Permalink | Comments (0)

Just an update for our PlaneBusiness Banter subscribers.

Because of our junket to the desert this week, as we noted in last week's issue, PBB will be posted on Saturday this week.

Posted by Holly at 2:29 PM | Permalink | Comments (0)

Anyone know whose rat this was, that was in front of the US Airways' headquarters Thursday?

While one usually sees the rat in such places as New York or Chicago, and the IAM is usually the one blowing him up, Thursday a large rodent was placed in front of the US Airways' headquarters. You know, it was Media Day. As a result, union employees took advantage of the fact by picketing outside the airline's headquarters.

But I'm not sure this was an IAM rat. He looked too new to me. The last IAM rat I saw in front of Grand Central Station a couple of years ago was really pretty disgusting. He'd seen some heavy use. Someone told me Thursday that ALPA now has a rat. Told me it cost the union $4000. Was this the new $4000 ALPA rat?

Maybe there is a rental market opportunity here. You know, Rent-A-Rodent.

My thanks to CrankyFlier, who had the opportunity to snap this photograph Thursday morning. While he was doing something constructive, yours truly was still trying to find a parking space, as the employee garage was blocked, and the spaces next to the headquarters had been roped off.

No worries. I got there. More to come. But one thing I will say is this.

There was a Reuters story that ran yesterday afternoon that was headlined, "US Airways CEO sees airline industry heading down." This story was filed almost simultaneously with the conclusion of the executive Q&A session of the Media Day program.

Both CrankyFlier and I were in that same room, and both of us were in disbelief when we read this story. US Airways CEO Doug Parker did not say that the airline industry was "headed down." He did say the industry was "a mess." But this was in the context of talking about consolidation, the economy, and a number of other related topics. In fact, US Airways President Scott Kirby said yesterday that while it is expected that passenger demand will begin to fall -- given what is going on in the economy -- the airline still has not seen evidence of such a weakening as of yet.

In summary, a very misleading story posted by Reuters yesterday afternoon.

Posted by Holly at 11:48 AM | Permalink | Comments (0)

It's me again. Sorry It's been a while since you've heard from me, but that wasn't by choice. It certainly wasn't for a lack of things on which to comment, that's for sure.

One recent trend in the airline business that, although is a logical result of too much capacity and $100/barrel oil, bugs me is ancillary revenue. There was even an "Ancillary Revenue Airline Conference" held recently. Heck, it must be here to stay if it is an acronym.

Call me a purist, but I think it is a sad day in Whoville if airlines can't make enough money from selling airline tickets to make a profit, so they have to resort to selling display ads on their tray tables and charging most customer for checking more than one bag. To be sure, the current conditions have created some strange bedfellows, including an alliance between Allegiant Air and The Blue Man Group, which still baffles me. However, people a lot smarter than I have determined that "it is good".

It may be helpful in the short term, but if an airline can't make enough money selling its services to support itself taking people to and from where they want to go, I don't think you can sell enough sandwiches, check enough second bags, or sell enough hotel rooms or show tickets to have any long term success. You might make it in the short term, perhaps make a few bucks in an IPO and get out before the house of cards falls in; but eventually the business plan needs to be sound.

Well that's all from Godzilla this evening. If, due to my absence, you have forgotten who I am you can check out Holly's introduction of me here. I would certainly be happy to read your comments; posted here or sent directly to Godzillaspeaks@gmail.com.

Posted by Godzilla at 5:36 PM | Permalink | Comments (2)

Hey folks.

Tomorrow I fly to Phoenix for the US Airways' Media Day, which cranks up on Thursday. 

The airline should be applauded for having a Media Day. At this point in time, only two airlines hold such an animal on a regular basis, and only US Airways has held one every year for the last several years.  Pretty sorry track record, don't you think?

For that -- the airline deserves a high five.

Yes, the original standard bearer of the PR and media crown for the airline industry, Southwest Airlines, also holds Media Days. But they are not held on a regular annual basis.

Given the fact that no other airlines even hold a Media Day -- both airlines really do deserve a public shout-out.

In addition, next week I'll be speaking at the Network 2008 Conference. The conference, which is sponsored by Airline Business magazine, brings together airlines and airport folks -- in San Diego. It's actually a cool concept. Kind of like "speed dating" for airports and airline route planning folks.

Yep. Lots of flying. Lots of opportunity to get out and meet more subscribers of PlaneBusiness Banter. And you -- readers of PlaneBuzz.

More later. In the meantime, behave yourselves.

Posted by Holly at 9:09 PM | Permalink | Comments (0)

Delta Air Lines' Management issued an "update" communication to its employees this afternoon.

"To: Delta Colleagues Worldwide

From: Richard Anderson and Ed Bastian

Subject: Update On Consolidation


The media continues to have daily coverage speculating on the airline industry, including speculation involving Delta.  As you know, for several months our Board and leadership have been reviewing strategic alternatives, including potential consolidation, to ensure that Delta maintains its leadership position in the industry.

Our review has been guided, from the beginning, by certain principles that have to be met if there were to be consolidation with another airline.  Our principles are:

-- that the airline be called Delta, headquartered in Atlanta
-- that the seniority of our people is protected
-- that the pension plans of our employees and retirees are maintained
-- that the network is strengthened and our plans for international expansion are accelerated
-- and, most importantly, that there is even greater job security along with more career opportunities for our people

To date, we have not arrived at a potential transaction that meets all of our principles.  Rest assured that we will not complete a transaction unless all of these conditions are met.  We have a strong stand-alone plan.  We will maintain our attention on executing that plan while we continue to look at strategic alternatives.

We appreciate the professionalism and dedication you show every day in running the airline.  It is the “Delta Difference” that sets us apart.

Thank you."

Posted by Holly at 7:26 PM | Permalink | Comments (1)

Put gas in your car lately? Yes, well multiply that feeling by about a million gallons a day and you'll get a small idea of what airline CFOs feel like these days.

If this keeps up, maybe we should all chip in and contribute to an "Airline CFO Antidepressant" fund. Nah. We probably need to keep our own dollars in the bank to pay off our own gasoline bills.

Today the price of a barrel of crude oil closed at a new high -- $100.88. This was an increase of $1.65 over yesterday's close. The price actually went as high as 101.06 during the day.

Wheeeeeeee.

Posted by Holly at 7:25 PM | Permalink | Comments (0)

Subscribers to PlaneBusiness Banter can access this week's issue here.

Posted by Holly at 6:19 PM | Permalink | Comments (0)

In regard to our posting yesterday here's the official notice from United Airlines' SkyNet:

"The United Express team is working closely with our partners to provide replacement flying aircraft during the Spring Break travel period. In anticipation of the high load factors, we've signed a contract with ExpressJet Airlines, Inc., one of the world's largest operators of regional aircraft, to provide three Embraer ERJ145 aircraft from March 12-29.

· ExpressJet is a new flying carrier for us. They have provided similar short-term capacity to other airlines and we are confident in their ability to provide efficient and reliable regional jet service for UAX.

· ExpressJet will be flying 20 flights per day carrying approximately 1,000 customers, and will operate into Dulles with service to Savannah, Pittsburgh, Huntsville, Jacksonville and Charleston, South Carolina. In order to be available during our peak demand period, the aircraft will be flown in ExpressJet livery."

Ticker: United Airlines (Nadsaq:UAUA) ExpressJet (NYSE: XJT).

Posted by Holly at 11:56 AM | Permalink | Comments (0)

No use in rewriting an excellent piece on the issues that are now holding up the formal announcement. Mary Jane Credeur and Mary Schlangenstein give us a good update this morning in this Bloomberg article.

Posted by Holly at 9:27 AM | Permalink | Comments (0)

As the pilots of both airlines apparently continue to try and come to terms on their seniority issues - the rest of us sit and wait. No news yet today on just when the Delta/Northwest merger may be announced.

In other rumblings however, one of our trusted moles sent us a communication this morning in which he outlined how a proposed United/Continental deal may come together. Remember, you heard it here first.

According to him, the bulk of the existing United Airlines brand will continue to be used internationally, but Continental will take over the domestic operation for the most part.

Other details we were told included the fact that there has already been a transition team put together. The deal will be announced after Delta/Northwest goes public.

There will initially be a holding company set up to run both airlines. This operation will continue for three-five years. This will allow for a "smoother transition" from the two airlines into one operation.

And, in another piece of related United Airlines news, we are being told that because of continued problems with Mesa Air Group cancellations, that United has turned to ExpressJet, and that ExpressJet is going to be adding regional service on behalf of United --beginning no later than the middle of March.

Indications are that ExpressJet will start flying at least three aircraft for United at that time, with the possibility that more aircraft could be added fairly quickly, "as needed."

Did United contact any of its other regional feeders about providing service before turning to ExpressJet? Apparently. But from what we hear there were no takers.

Tickers: (Nasdaq:MESA); (NYSE:XJT); (NYSE:CAL); (Nasdaq: UAUA); (NYSE:DAL); (NYSE: NWA)

Posted by Holly at 12:25 PM | Permalink | Comments (1)

Never fails.

I have to go see the tooth doctor, it takes much longer than it should, I walk back in the door and all hell has broken loose. My email inbox looks like a combat zone.

What a day. Where do we start?

Crude Oil Sets New Record High

First off -- the price of crude oil. Crude oil closed today up more than $4.50 at a record $100.10.

Why?

We talked a bit about this in last week's PlaneBusiness Banter. OPEC has been signaling that it does not intend to increase production, and in fact is considering lowering production levels when it meets next month.

Today, traders went nuts -- over the possibility that the decision to cut production levels could come as early as two weeks from now.

It also didn't help that an explosion yesterday shut Alon USA Energy Inc.'s Big Spring, Texas, refinery. According to Bloomberg, the facility can process 70,000 barrels of crude oil a day. Alon said in a statement that its goal is to resume partial operations in about two months.

Airline Stocks Drop Like Rocks

Horrible day for airline stocks today -- as a result of the record-breaking crude activity. A small handful of airline stocks managed to post gains on the day including FEDEX, Hawaiian, Republic Holdings and WestJet. The rest? Not a lot to get enthused over.

US Airways East Pilots Get Representational Election Nod from the NMB

"USAPA NEWS FLASH : The National Mediation Board has ruled that, for the first time in 45 years, ALPA is in dispute.

We have an election!

More news to follow.

From the Officers and volunteers at USAPA, thank you for your unwavering support!

"Leaders of the union representing 11,100 pilots at Northwest Airlines Corp. and Delta Air Lines Inc. have reached an agreement on consolidating the two groups of workers under a merged carrier, sources close to the matter said Monday.

It outlines terms for combining the pilots' seniority lists, as well as calls for a pilots' representative on the board and an equity stake in the merged airline.

The plan addresses most of the pilots' concerns and removes a major hurdle to a Delta-Northwest merger.

The agreement between the Delta and Northwest chapters of the Air Line Pilots Association -- the only union representing employees at both airlines -- will be presented Wednesday at a scheduled meeting of Delta's board in New York, the sources said."

Posted by Holly at 5:23 PM | Permalink | Comments (0)

Thanks to one of our United Airlines' readers, who sent us this post  tonight.

A Glimpse of the Friendly Skies
By Captain Loren Bohnett, A-320 SFO


On a leg home from Denver last December, we had some VIPs on board who seemed as excited to meet us as we were them. The President of The Greatest Generation Foundation, www.tggf.us, was on our flight traveling out to HNL through SFO with a number of Pearl Harbor veterans. All of these gentlemen stopped by the cockpit, crowding in, in twos and threes to take a quick look, introduce themselves, and shake our hands. Among them was an Air Corps vet who flew B17s, 24s and 29s during World War II. He was impressed by all the glass, but stated for the record that he preferred round dials; who was I to disagree? According to the TGGF President, these gentlemen hadn’t been back to Pearl since the end of the war, but they would be front and center for the festivities this year.

As pushback time approached, a flashing ACARS message got our attention; almost never good news. Our minor EDCT delay had been modified for the worse and it would be at least an hour before takeoff. The low clouds at home were backing up the system again. A little research confirmed our fears: these guys were not going to make it to Hawaii tonight as they would miss the last flight out of SFO. Would UA delay the HNL flight? Not likely. There was some hope though, if everyone could pull together and make it happen.

We sent an ACARS note to Dispatch asking them to involve the ATC Coordinator, explaining the nature of the assembly we had aboard. As the leader of that group waited in the cockpit with us, a look of concern on his face, a message came back: “How soon can you be ready?” A plan had been hatched to add a few minutes of delay to five other flights so that ours could be greatly reduced. Our new EDCT came from Dispatch along with the plea: “don’t miss it!” Everyone involved from our flight attendants, CS, and Ramp jumped into action and we made our departure slot.

Our little piece of the Friendly Skies ran like a first-rate airline that night, LCO or not. Everyone involved stepped up and did their part efficiently and with purpose. During the fast run to the west coast, as I keyed in our request for assistance at SFO, Dispatch sent us another note. Everyone was in the loop already and would be awaiting our arrival. Our gate assignment put us directly across from the HNL flight and CS would be there to serve as escort, we were told. After my flying partner greased our jet onto 28L, we arrived at the gate to find everything in place. A smiling CS supervisor was in fact waiting in the jetway holding a stack of boarding passes.

The best part of this story is still to come. It turns out that back in Denver, one of United’s Global Services customers overheard the travel plans and the importance of the trip our veterans were on. This anonymous person got involved and stepped up as well. Those boarding passes awaiting our arrival were all First-Class upgrades, paid for by this customer.

Many take for granted the incredibly complex task of providing safe transit that pilots perform day and night, flight after flight. From my perspective, as Flight Officers we played the usual leadership role, which is critical to safety as well as to the customer experience. What was special this night was that our extra efforts were well-received early on, which led to effective coordination and a better solution. Employees across the system were eager to help, motivated by the desire to honor this deserving group of veterans.

For me this was a glimpse of what our airline could be like every day for every passenger. We have the equipment, the facilities, and, most importantly, the people to provide this level of service and attention on every flight. Unfortunately, such a renewal of enthusiasm across this company would require a level of genuine appreciation, motivation and leadership from the top that is sorely lacking today. My hope is that we do experience this renewal, and sooner rather than later. For a couple of hours, this was a great place to work."

Posted by Holly at 6:55 PM | Permalink | Comments (2)

Just a reminder for those of you who are following the Northwest/Delta Air Lines' negotiations with interest.

As has been widely reported, Wednesday the Delta Board of Directors has a meeting scheduled.

While it may not result in anything noteworthy -- it's certainly the type of potential timing event that could lead to a formal announcement concerning the deal.

Posted by Holly at 6:51 PM | Permalink | Comments (0)

I've talked here before about what a drop-dead great columnist Bill Simmons from ESPN is. Note, I said, "columnist." Not "sports columnist."

He's done it again.

And this time he's writing about a subject close to home. My home.

"Like everyone else who was there, I had more fun than I thought, and I won't forget what I saw, and I'll always remember painting the walls of McDonogh 35 on Friday afternoon and basking in the spirit of the kids who attend school there. They were happy to have us, and we were happy to be there, and that's what life is really about.

Did the weekend accomplish anything other than painting a few schools, planting a few gardens, raising some much-needed money and making the city feel good for a few days? I say yes. Everyone who travelled here for All-Star Weekend will think about returning some day, not because they feel bad, but because it's New Orleans, and it's ready for us again. Skip your next Vegas trip and convince your friends to spend a wild weekend in the French Quarter. Don't do it for charity, do it because it will be fun. And it will."

Yes, it was a great weekend here in New Orleans. The city put on one great friggin' show for the NBA and all the fans who streamed into town to participate in the NBA All-Star festivities.

But, hey, Bill Simmons has already written the consummate column about it all. Here.

Posted by Holly at 4:37 PM | Permalink | Comments (0)

Okay, I think this is the last of the mega-earnings issues. It had better be!

Subscribers can now access this week's issue of PlaneBusiness Banter here.

Posted by Holly at 1:48 PM | Permalink | Comments (0)

Reading through the email this morning before finishing up this week's issue of PlaneBusiness Banter and couldn't help but post this one. Longtime reader and PBB subscriber, this person told me I could post his note, as long as I didn't say who he was. (Methinks he must have some friends at Alaska.)

No problem. I understand. That's why I always get lots of emails and very few public comments. <g>

So for your Friday morning reading pleasure, yet another first-hand account of good relationships gone bad. Frequent flyer relationships that is.

Holly,

Enjoyed your rant about frequent flyer tickets, even though it reminded me of the pain I've been enduring lately. Perhaps my most disappointing experiences of late have been with Alaska Airlines. Believe it? Alaska, my favorite airline of choice for many years.

Last August, I began searching for a reservation from Spokane (GEG) to LAX for Christmas. Even that far in advance, seats were very limited. The only ones I could find at the 'saver' rate of 20K miles were on the nonstop flights, which you'd think I would prefer. I would, except they were earlier changed from Alaska big jets to Horizon CRJ700s. I don't mind that type for a short flight, say from GEG to SEA, but a 2 hour, 49 minute journey down to LAX? I don't think so. Then I checked connections over SEA, and found nearly all the seats would cost me the equivalent of LUV's "Freedom Fare," or 40K miles. It turns out first-class tickets are also 40K miles, so why not book up front? The "best" connections involved three or more hour sits at SEA both ways.

I finally found a decent connecting going into Long Beach (LGB), with a return from LAX still involving nearly three hours of sit time at SEA, and booked the flight. Imagine my glee when, in November, ExpressJet announced new GEG-LGB service and offered an introductory roundtrip fare of $205 including nuisance fees, taxes, etc. I jumped all over it and gladly paid the $50 cancellation fee (since increased to $75) for Alaska to redeposit my miles.

I won't go into all the details of my Florida trip that I wound up canceling as well, but here are the highlights: Alaska had no first-class seats on the daylight SEA to Orlando (MCO) flight on any of the three days I selected. Not being fond of red-eyes, I reluctantly booked the downward portion on Delta, an Alaska partner, with a return on Alaska; 45K miles, thank you very much. Shortly thereafter, I was notified that my Delta flights had changed; the 737-800 on the GEG-SLC portion was miraculously turned into yet another Canadair Regional Jet, not quite as long a flight as GEG-LAX, but long enough to turn me off. Because this constituted an "involuntary" schedule change, I was allowed to cancel and redeposit my miles, and then booked a "real" ticket on Frontier.

At this point, I was ready to reserve another flight to LAX for March. ExpressJet came in at $224 all up to LGB; why even bother with an Alaska mileage ticket? I decided to dump the remaining 140K Alaska miles and fly in style to Frankfurt next November for the annual aviation photographers meet; 140K miles equals roundtrip in first class on British Airways from SEA via LHR and includes the GEG-SEA portion on Alaska; I've done this trip six times already and thought it would be fun to see BA's new Terminal 5; by then, they should have all the kinks worked out.

Now for the fun part. Alaska's "Partner Desk," that handles the details, was efficient and pleasant, as much as one can be with all the bad news. First class? Nothing available eastbound on the day I wanted, or the day before, in the dark of November; no holidays around it, nada. Going via Vancouver? Nope. Even San Francisco? Nope.  By going over a day earlier, I was able to get a business-class seat. The kicker is that business class is only 20K miles cheaper than first, which is well worth the extra 20K. I could get first coming back, but on the later departure from LHR, and it would cost me the 20K extra, even though I was going over in business. Okay ... I went for business on the preferred flights. Those pesky taxes and fees were "only" $139!!

Once the formalities were complete, I was given my seat assignments on the Alaska segments. I asked if, as in the past, I should contact British Airways for my other seat selections? "Oh no, you don't need to. Those seats are assigned at check-in." Huh? I'm booking in business class TEN months in advance and can't get pre-assigned seats? "No, only in First do they allow that." But First is what I want!! The gal explained that I could check in on-line 24 hours in advance in order to get the best of basically what was left. Swell; you sure do get a lot for those 120K miles.

Well, silly me. After a week, I thought about that first-class bed for the return flight, which would get me home about 3 hours later, but what the hell? The 20K sitting in my Alaska account was all but useless and I might as well shoot the wad. I called back to Alaska, and an equally pleasant reservationist told me that yes, the seat was still available; would I like to do that? Yes, thank you very much. Done, even with a seat assignment: 4A. "And what credit card will you be using for the $75 change fee?" You've got to be kidding! "No, if you had upgraded on the same flight there would be no charge, but you're changing flights." Yes, even on the same day. Well, take my credit card, please! And take my 20K miles; we won't be having this conversation again. The good news: I can keep calling and calling and, should by some miracle that first-class seat become available on the same eastbound flight, I can upgrade with no additional fee or miles. Now let me think: what are the odds? For fun, I checked the British Airways site, with the thought of changing my seat assignment. But alas, at least for us lowlife Alaska folks, only the last row in first was available, or center seats; the rest of the good ones were blocked. Could all those seats already be assigned to "real" people? I doubt it. At this point, I printed out my reservation details and filed them. I may try calling later for that elusive first-class seat. Then again, maybe not.

A footnote: when I was going through the drill with my LAX reservations, I commented to the reservationist about the difficulties involved and disappointment with Alaska's tightened, more restrictive frequent-flyer rules. He responded with the company line: "We're just made the changes to become more in line with industry standards; all the carriers are tightening the rules." I reminded him that Alaska had been my airline of choice precisely because it was BETTER than the rest, and by aligning itself with the industry, its advantage as my airline of choice was quickly evaporating.

Pardon my ranting; I've just cut up my Alaska Visa card and feel much better.

Happy New Year!

Posted by Holly at 11:11 AM | Permalink | Comments (3)

In case you're wondering why it was that airline stocks went boom today -- the reason was the usual suspect. That reason was the rise in the price of oil.

Today the price of a barrel of crude picked up a cool 2.19, closing at 95.46.

By the way, anyone looked at the price of platinum lately? Hey, maybe some of you were thinking of giving something made of platinum to your sweetie for Valentine's Day. So my question to you would be -- did you buy it? Conversely, if you had been expecting something made of platinum at the bottom of your box of Godivas, did you get it?

The reason I ask this is because the price of an ounce of platinum closed at a whopping 2012.00 today. Gold, meanwhile, closed at 911.00. New record for platinum. Gold hit its high in January at 927.10.

Every time I look at the price of gold, I keep thinking about the car driver in Phoenix I used to use to pick me up at the airport -- he was originally from New York and a little over three years ago he and I had a big discussion about gold. He told me he had decided it was time to buy some. He told me he was going to shed some of his stocks and buy about $30K of gold stocks.

I hope he did. It was priced around $375 an ounce at the time.

Posted by Holly at 8:13 PM | Permalink | Comments (0)

For those of you who are US Airways' passengers, you woke up this morning to a little Valentine's Day surprise.

And not of the good variety.

Damn, where are those chocolate-covered strawberries when you need them?

The airline sent out email missives today outlining two major changes to its frequent flyer program. One, the airline is now going to award actual miles, and not the minimal 500 mile credit, when a flight is flown.

Secondly, if you want to make a frequent flyer reservation less than 14 days in advance -- it's going to cost you $50.

Speaking of changes to frequent flyer mile programs, I got burned this weekend when I went to use a Southwest Airlines Rapid Rewards ticket for an upcoming flight. This was the first time I have tried to redeem a RR ticket since the changes Southwest put into effect to their RR program last fall.

You know, those changes that didn't get nearly the same press coverage as the airline's new "Business Select" roll-out. Except for here. We did talk about them.

But talking about them, and experiencing the changes are two different animals.

So this weekend, I knew that I had a flight coming up and I knew I had two RR tickets that were expiring in the next two months. So I figured, well, at least I can use one of them.

Wrong.

Using the airline's new "availability" chart system to find out if there were any flights available on the days I wanted to fly (another rant for another day), the chart said yes, there was availability. The only problem is that the flights I wanted were NOT available. This is definitely a flaw in the airline's new system. I don't want to waste me time looking for avails if, after then going the extra distance to look at specific flights on specific days that supposedly have flights, that no, not ALL flights are available. Not sure how they could set it up differently, but it's very frustrating. Or maybe it's just frustrating because the whole time you're in the middle of this mess you keep thinking about how easy it used to be to use a RR ticket. You called Southwest. You made a reservation. If there was a seat on the plane you got a seat. Period.

So now it appears that for the flights that are not two stops, and/or the longest in duration for the day I want to fly, I have to use not one, but two of my RR tickets -- exchanging them for what is euphemistically called a "Freedom Award."

If this is a "Freedom Award" why does this process leave me feeling so shackled?

Okay, so after stomping around for a bit, I decide, "Okay, the tickets are going to expire anyway, I'll just use both of them and get a "Freedom Award" ticket on the flights I want."

Go through the whole process again. This time I get a message that says I don't have enough tickets to convert to a "Freedom Award."

Investigating further, I realize that last year I did use one segment of one two-segment RR ticket when I had to come home earlier than expected.

So now I have three segments, not four. And I can't get a "Freedom Award" RR ticket for the dates and flights I need.

At this point I decide, okay, I give up. I'll buy a damn ticket.

Now, considering that there is only one airline that flies nonstop to where I want to go on this particular trip, and that airline is Southwest, I go back to the home page and start over.

But when I get to the fare page, I blanched.

"Business Select" round trip fare across the board, nonstop or one or two stops? $798.

Cheapest fare using two one-stop flights? $402.

I don't think so. Not so fast.

Off I go to Continental Airlines' website.  They can fly me where I want to go. On the day I have to leave. I just have to connect in Houston. Not one of my favorite activities, but hey, there is a point of diminishing disadvantage in this exercise.

About 10 minutes later, I have a round trip for $322 total, and short connect times in Houston on both ends. Oh, and yes, I have reserved aisle seats on all four segments.

Granted, passengers have been kvetching about the airline industry and its members' continued attempts to reduce the actual "value" of frequent flyer tickets for years. Today's announcement by US Airways is just the latest in a continual devaluation in the actual "value" of a frequent flyer ticket on American, United, Delta, Northwest, name your airline.

But through all that screaming and yelling in the past, I would just sneer. After all, I was a Southwest Airlines' Rapid Rewards flyer. I enjoyed the best FF program in the industry. My tickets were actually worth something. They were, in a way, the chocolate covered strawberries of the frequent flyer world.

Something to be savored. Enjoyed. Cherished. A tangible reflection of my LUV's affection.

Alas, no more.

Cupid has apparently decided he has to be more, dare I say it, productive.

Ticker: (NYSE:LUV); (NYSE:LCC), (NYSE:CAL)

Posted by Holly at 1:49 PM | Permalink | Comments (0)

Reports out this morning from the Associated Press say that David Neeleman, founder of JetBlue, is planning start a new Brazilian airline and is in negotiations with Brazil's Embraer plane maker to buy 36 mid-range jets.

The report originated with the O Estado de S. Paulo newspaper.

According to the publication, Neeleman has already lined up $200 million for the venture.

The newspaper, citing sources close to the deal, said Neeleman has already bought a small Brazilian airline named Cheta with government authorization to operate in Latin America's largest nation.

And folks, here's the kicker to the story.

Because Neeleman holds both American and Brazilian citizenship, he would be able to overcome a major hurdle: A requirement that only 20% of Brazilian airlines can be owned by foreigners or foreign companies.

Interesting, eh?

Posted by Holly at 10:18 AM | Permalink | Comments (0)

Our friend Cranky Flier had a little sit-down today with that new hot Alaska Airlines' virtual assistant Jenn.

Check out his conversation here.

If you're a fan of the cyborg chick on the "Sarah Connor Chronicles" you'll really get into it.

Posted by Holly at 6:41 PM | Permalink | Comments (0)

PlaneBusiness Banter subscribers can now access this week's issue here.

Posted by Holly at 5:50 PM | Permalink | Comments (0)

Thanks to a number of you who wryly noted that not too long after we posted our note about the drop in Mesa's stock price yesterday  (following the airline's traffic release) that suddenly volume in the stock picked up and well, by the end of the day the stock was down just a bit more than 1%.

Heh.

As one of you wrote, "I think your post motivated the troops."

Very funny.

Not surprisingly, that late-day surge disappeared this morning with the stock down more than 5%. There was a pretty big sale right after 10 AM ET. But as I look just now, it appears to be making a small recovery.

For those of you who don't make it a habit of watching Mesa shares on a daily basis -- this stock has a pronounced propensity to pick up in volume and price late in the day. Especially if it has had a down day prior.

This stock has also always been known as a  "trading" stock, and given the airline's current situation -- this type of volatility is to be expected as people rotate in and out, trying to grab gains on the upticks. Conversely, they can use price gains as a reason to shed some positions.

Ticker: (Nasdaq: MESA)

Posted by Holly at 9:54 AM | Permalink | Comments (0)

It's Friday.

Whoopee!

I'm working on the last page of this week's PlaneBusiness Banter and I have Loverboy screaming "Working for the Weekend" on my iPod. Not really. Too early for that. However, the good news is we do not have a 50-plus page issue this week. Thank goodness.  We'll be up and posted here in a few hours.

Meanwhile, I couldn't help but shake my head when I read a headline from a press release issued by American Eagle this morning.

Headline: American Eagle Airlines is Your Route To Success.

Note that I read this just 10 hours after finishing up the page in this week's PBB where I  talk about the December DOT operational statistics.

In December, American Eagle placed dead last in terms of on-time performance, it lost more bags than any other airline -- except one, it finished in the bottom-third of the group in terms of complaints, with complaints up 115% year-over-year, and it notched more flight cancellations than any other airline.

Given these stellar performance numbers, I'm not sure the American Eagle operation is anyone's route to success these days.

Ticker: (NYSE: AMR)

Posted by Holly at 9:45 AM | Permalink | Comments (0)

Blog post  today on Terry Maxon's Dallas Morning-News airline blog concerning the flight attendant union elections at American.

Terry's post saves me from rehashing a lot of what he has already been written.

Essentially, the big issue with this election is the status of the ex-TWA flight attendants. Yes, again. Just like 2004.

I've been reading emails from supporters of both sides for the last week, and frankly, I don't understand why this issue continues to be ...an issue.

Or as Laura Glading, who is running for President is quoted in Terry's blog, the subject "is over. Dead. Resolved in the courts."

But the rumors of some kind of "deal" between Glading and the TWA group persist. And it would appear that Glading's opponent, John Ward, is more than happy to make sure that remains the case.

John Ward, the former head of the Association of Professional Flight Attendants, who is running against Glading won't let the issue die. On his site, he claims that ex-TWA employees are going to vote in a block vote for Glading.

The bitterness reached such a point yesterday that Glading was forced to issue an email, which I received. In it she said, "I have absolutely no intention of changing or reshuffling the APFA seniority list. Furthermore, I did not make a deal of any kind with the former TWA Flight Attendants or the STL Base Reps regarding seniority in order to earn their support. The seniority issue has been settled in the courts. Anything that is being said or posted to the contrary is being done for the sole purpose of scaring the membership into voting for John Ward. Period."

Ticker: (NYSE:AMR)

Posted by Holly at 5:40 PM | Permalink | Comments (2)

Republic Holdings:

"Monday, Republic Airways Holdings Inc. (RJET), a provider of various airfreight services, announced traffic results for the month of January, reporting a 34.1% rise in traffic on 30.6% increase in total capacity. Load factor for the month increased 1.7 points.

For the month of January, Republic Airways' load factor increased 1.7 points to 65.6% from 63.9% in the same month of the previous year.

The Indianapolis, Indiana-based company's revenue passenger miles of 710.0 million were 34.1% higher than 529.3 million in the comparable month of the earlier year. Available seat miles grew 30.6% to 1.08 billion from 828.6 million in the same month a year ago."

Mesa Air Group:

Mesa Air Group, Inc. reported its preliminary traffic figures for January 2008. Year-over-year available seat miles decreased 11.76% in January 2008 to 690,205 compared to 782,157 in January 2007. Revenue passenger miles decreased 13.15% from 537,740 in 2007 to 467,045 in 2008. Passenger enplanements decreased 14.33% from 1,267,414 in January 2007 to 1,085,778 in January 2008. Year-over-year load factor for the month of January was 67.67% in 2008 compared to 68.75% in 2007. (A decline of 1.1 point.)

Oh, and Mesa's money-losing go! operation? The airline flew at a 58.36% load factor in January. For 2007 the load factor was 58.41%.

In the airline's release, Mesa CEO Jonathan Ornstein was quoted as saying that the airline's operations had been negatively affected by "severe winter weather."

So how come Republic' s operations weren't so adversely affected by the same "severe winter weather?"

Apparently some other folks aren't buying the story that all of this decline is due to bad weather, as shares of Mesa are down about 8% as of this writing, posting the biggest decline today (so far) for the sector.

Tickers: (Nasdaq:RJET); (Nasdaq:MESA)

Posted by Holly at 1:08 PM | Permalink | Comments (0)

An article in today's WSJ says two things. One, we should hear more about a Delta/Northwest deal in the next week or so. Yawn. Two, things are "heating up" between United and Continental.

Unless upper management at Continental stays intact as part of such a deal, I'm not signing on -- regardless of how much money Glenn throws at me to do otherwise.

On another front, the American/ Alaska rumors simply won't stop. Today birds are telling us that Frontier may also be in the mix.

Would certainly be a quick and, I might add, very dirty way, to finally give American that western presence they have lusted after for ......oh.....how long? Yes, visions of Reno Air and Air Cal rear their ugly heads. Would also give American a slew of nice new aircraft, although they would be of different flavors.  But when all is said and done, that alone might be worth more on the Ouija board of potential match-up bingo than anything else.

As I have said before -- don't try and figure out any of these things by questioning route match-ups, fleets, union pairings, or other rational measures. It will drive you nuts. And frankly, it's not worth it.

Nope, as Dick Vitale might say, "It's all about survival baby!"

Speaking of, good to hear Dick return in his fine form last night for the Duke/UNC match-up.

FYI, the biggest movers in the airline sector today are AMR, parent of American, Alaska, JetBlue and Southwest.

Speaking of Southwest – As I mentioned in last week's PBB, the hedge fund parent of ATA said in a recent SEC filing that it is considering unloading its passenger operation.

Yes, that same passenger operation that Southwest now codeshares with.

This brings up a couple of interesting things to chew on. On, there are reports that Aloha Airlines might be interested in snapping up the passenger operation. That would, of course, depend on what Aloha mega-investor Ron Burkle decides he wants to do. But it certainly could complicate the already nutso Hawaiian airline landscape.

But also, what will Southwest do?

Would be a much more valuable deal for Southwest if ATA had not already sold off those nice slots on the East Coast to AirTran.

Ticker: (NYSE:LUV); (NYSE:CAL); (Nasdaq: UAUA); (NYSE:ALK); (Nasdaq: JBLU);  (NYSE:NWA); (NYSE:DAL).

Posted by Holly at 12:37 PM | Permalink | Comments (0)

The folks at Alaska Airlines sent me an email today, introducing me to their new virtual assistant for Alaska customers.

Just a side note. I have never really "warmed" to the whole avatar thing. I guess because I've never thought of a really useful use for one.

But after having visited with "Jenn" over the last half hour, I have to say I am pretty impressed.

It's a pretty cool way to handle customer questions.

You can grill Jenn yourself by going here. 

Over about a 20 minute period, I threw my best questions at Jenn, including ones about seat pitch, schedules, onboard options, weather, and refundable tickets. Just to mention a few of my queries.

Not only does she answer back in the answer box on your screen, but your browser is also then automatically taken to the appropriate page on the Alaska Airlines website that is appropriate to the question.

Pretty cool. I like it.

Try it.

Ticker: (NYSE: ALK)

Posted by Holly at 12:15 PM | Permalink | Comments (0)

If you are wondering why your favorite stock (and hey, today it doesn't even need to be an airline stock) is glowing red and not green this afternoon as you check your online portfolio, there's one big reason.

The Institute for Supply Management’s (ISM) report which was released this morning, was worse than bad. It was dreadful.

The ISM reported today that its index of service sector business activity declined to 44.6 in January from a revised reading of 54.4 in December.

Economists surveyed by Thomson Financial had expected a slight slowdown but had still forecast growth, with a median estimate for the index of 53.

As with a number of economic indexes, a reading above 50 usually indicates expansion of the economy, while a number below 50 indicates contraction.

As if the drop was not newsworthy enough just because of its sheer amount, this also marked the first time the service sector reading has contracted below 50 since March 2003.

“This is an absolute collapse of this index,” Nigel Gault, chief U.S. economist at Global Insight told CNBC.

So now that we know the big story, how about the things with wings? How did they fare specifically?

Not so good.

Of all the airline stocks we track, only five posted a gain for the day. And the extent of those gains were nothing to get excited over. Those stocks were: Continental, American Airlines, Alaska, Allegiant and Ryanair.

And oil prices? Crude closed today at $88.41 -- down about $1.61.

Posted by Holly at 3:37 PM | Permalink | Comments (0)

Nothing more to say about that game last night, except, "What a game."

That one play has to be one of the greatest I've ever seen in any game, much less a Super Bowl. If you watched the game, you know the one I'm talking about. If you're a Patriots fan, I'm sure you don't want to ever see it again.

And how appropriate. We have a native New Orleans son as MVP of the Super Bowl for the second year in a row -- just in time for Mardi Gras tomorrow.

I swear -- if someone in the Mystic Krewe of Rex could figure out a way to make a float in 24 hours, I'm sure they would be working on it right now -- so Eli Manning could ride on it Tuesday morning.

Yes, it's a bit bonkers here in Louisiana today. The natives are so excited for so many reasons it's hard to describe.

Meanwhile, I walked outside today and almost walked right back inside. It must be 78 degrees out there. You know what that means. Yep. Looks like it is going to be perfect weather tomorrow for some rather, er, skimpy costumes.

No, not for me. My days of wearing skimpy Mardi Gras costumes is long gone. If I were to do that tomorrow, I'd scare people. Nah, I'll be the one in the jeans with the camera (s) in tow. Nothing beats people watching on Mardi Gras day. Unless it's taking their picture.

Posted by Holly at 12:42 PM | Permalink | Comments (0)

I need a vacation.

Hey guys! After four straight days of writing, this week's mega-earnings issue of PlaneBusiness Banter is now posted.

All I have to say is "Thank God All The Major Airlines Have Now Reported Earnings."

Woo hoo.

PlaneBusiness Banter subscribers can access this week's issue here.

Posted by Holly at 9:08 PM | Permalink | Comments (0)

Lovely day here, located as we are outside of the Big Easy. It's Mardi Gras and those in town to party hardy are in for a beautiful couple of days to do so.

Alas, yours truly is not. Sob. Oh no. I'm still mired in our mega-page issue of PlaneBusiness Banter for this week. It will be posted here in a bit. As usual, I'll post a note when we are up and ready to be read.

So why is this week such a mega week? This is the largest earnings review issue this quarter.

We had three full reviews in last week's issue. This week we have six.

Have a good one everybody. I'll be back in a bit.

Posted by Holly at 9:25 AM | Permalink | Comments (1)

I forgot to mention -- as our observant reader also noted in a follow-up email. Captain Dan is Dan Eikleberry and is a retired United Airlines' Captain.  In the video, he's still wearing his United hat and bars but chose a tie that doesn't match.

Meanwhile, Tim Ford, the Director of Training, came from Skybus where he held the same position.

I'm telling you folks, this really looks way too much like Saturday Night Live.

I mean, on the other hand, I guess you could argue that it's inspiring. Makes me want to go out and file a DOT application to start PlaneBusiness Express.

Posted by Holly at 10:08 AM | Permalink | Comments (3)

Just a couple of things before I slam the door, turn the phone off and absorb myself in finishing up this week's mega-earnings issue of PlaneBusiness Banter.

One, our new contributor Godzilla is having some difficulty with our new upgraded version of Movable Type. Rather, MT is having problems of its own. Godzilla is, as far as we can tell, blameless.

We will start working on resolving these issues after this week's issue is done.

So yes, he tried to respond to the comment left on his Family Airlines piece from yesterday, but alas, MT refused to take it. (Maybe MT just knows something we don't?)

Speaking of Family Airlines, a reader wrote me a note today, in which he suggested we check out the video clips at the end of "Captain Dan of Family Airlines" video.

"Holly, check out the video clips at the end of "Captain Dan of Family Airlines" video.  I hope these aren't samples of the "In-Flight Entertainment".

Clip # 4:  "TACA TERROR ON TAPE" Flight 510
Clip # 9:  BA Plane Crash-Lands at Heathrow
Clip # 8:  Baby Born Onboard Flight KU411
Clip # 11:  Airline Incident Southwest Kicks Family Right Off Flight
Clip # 12:  Southwest Airlines INCIDENT Again! Kicks Family Off

Maybe they should rename it "Terror Airlines".  Or "Scare The Shit Out Of My FAMILY AIRLINES!"

Or maybe his last suggestion, "Family Scare."

Well, you know, until I got this note, I thought the most scary thing about this website was the fact that it had ads on it for such things as setting up your own Nevada corporation for cheap, and some political hack running for Congress. Oh, wait. That's Barry Michaels. That's the airline's CEO.

Frankly, I'd never watched Family Dan's clip all the way through, it was so bad.

But our reader is right. There is a really strange assortment of other YouTube links at the end of it. Not necessarily clips that should be on there.

Who are these people? I mean, is this whole thing really a creation of the Saturday Night Live writers who have nothing better to do now that they are on strike?

Posted by Holly at 9:55 AM | Permalink | Comments (0)