Airlines: Take the poor off the plane

by Tom Johansmeyer on

My recent post on passenger rudeness and airline employee customer service generated a considerable amount of discussion. What really struck me was the number of readers who cited the overlapping factors of deregulation, lower fares and increasingly crowded flights. Basically, because flights are cheaper, more people can afford them, and service levels can’t be sustained in light of both increased passenger traffic and ostensibly lower revenue per available seat mile.

So, it seems to me the solution to fear and loathing in the skies is to boot the poor – to make air travel unaffordable. In doing so, you reclaim the regulated-industry experience that everyone seemed to enjoy, whether or not regulation itself is actually necessary.

What I’ve learned from many readers – and airline industry employees – is that we need to return to the days of getting dressed up to fly, dignified behavior and a higher cost for better service. Translation: we need the “right” people in seats … even in coach. And that means setting up financial barriers to entry. If we restrict travel to the elite, the experience, I seem to be hearing, would be far better.Make no mistake about it: every complaint about the impact of low fares on the industry, especially when compared to the days of airline regulation, is a tacit admission that a specific group of people should be excluded from air travel based on disposable income. Of course, any price does this, as you need to have the funds available to purchase an item that’s for sale, but the notion that air travel is too cheap implies that, like an upscale restaurant, it should be inherently exclusive.

With higher fares, limiting air travel only to those who could afford it, fewer people would experience different parts of the country or the world. Some currently flying would have to turn to cars or buses instead. It’s easy to see how these travel experiences, without access to flights, could turn ugly quickly. The flights themselves, however, would be far better, comprised only of passengers with the means to purchase higher-priced tickets.

I, frankly, have no stance on whether air travel should exclude large portions of the proletariat. Rather, I support pricing that is driven by an efficient market (which also means that I’m not a fan of regulation). Yet, I do see the implications of what some would consider to be “appropriate” fares – rather than the cheap stuff we encounter out in the market now – as turning the airlines into a transportation equivalent to a private club.

Is this what people intend through their lamentations about flight pricing?

So, we can solve the customer service problem, it seems, by taking the poor – and perhaps the lower middle class – out of the equation. Those left will have to pay a bit more, but at least they’ll be surrounded by “desirable” travelers. The rest of us? Well, we’ll have plenty of leg room at home, I suspect.

[photo by stevendepolo via Flickr]

Hidden airline fees under attack, industry pushing back

by Tom Johansmeyer on

It isn’t so much the airline fees that are being targeted these days: it’s the extent to which they are hidden. Three advocacy groups are pushing for airlines to do a better job of disclosing how they’ll nail passengers for extra cash. So, a battle of paper is emerging. On one side, advocates are pushing a petition to get airlines to open the kimono a bit more. And on the other, airlines are looking to protect the paper they’re stacking from ancillary fees.

The stakes are high: last year, the airline industry pulled in a whopping $8 billion for extra charges. They stand to do even more this year, thanks to a recovering travel market.

The American Society of Travel Agents, Business Travel Coalition and Consumer Travel Alliance are getting together to push for fee transparency and to “allow travel booking companies access to fee schedules, making comparisons easier among airlines by third parties.”
According to the Dallas Morning News:

Travelers “are tired of arriving at the airport and finding huge unexpected costs for travel services they thought were part of the ticket price,” said Kevin Mitchell of the Business Travel Coalition, which lobbies for corporate travelers. “It’s time for consumers, corporate travel managers and travel agents to stand up and say, ‘We’re not going to take it anymore!’ “

Meanwhile, the airline industry is marking its territory:

“We remain confident that the level of transparency that some opine doesn’t exist, in fact, does exist,” said Air Transport Association spokesman David Castelveter, who points out that coverage of airline fees has become ubiquitous and that even casual travelers are likely aware of fees. “I went to the websites of all our members, and there isn’t one of our carriers that didn’t have bag fees prominently displayed when you book.”

The goal is to drop the petitions to the Department of Transportation on September 23, 2010.

[photo by williamcho via Flickr]

Five business travel factors for Obama and the midterm elections

by Tom Johansmeyer on

Leisure travel is irrelevant during the election season, but the woes of business travelers seem to resonate. With the midterm contests two months away, all eyes are on the White House … and President Obama‘s success rate with road, rail and runway repair.

This is the one time business travelers make the presidential agenda, according to Portfolio.com: “Presidents (or people campaigning for any office) only talk about business-travel infrastructure during election season. Our issues almost never seem to rate presidential attention at any other time in the cycle.”

Well, let’s take a look at what Obama’s done for the white collar travel crowd. Here are five business traveler issues that could attract some attention in November:1. Secretary of Transportation appointed: With passengers’ rights considered and a solution implemented (and one that seems to be working), Ray LaHood seems to have been a savvy secretary. And, airlines have been slapped with some hefty fines, proving that they need to take responsibility for their actions.

2. Not so much at the TSA, though: While Portfolio.com gives Obama high marks on behalf of business travelers for LaHood, it’s a little tougher on his choice for top dog of the TSA. The president waited a year to tap someone for the job, suffered through Senate procedural tricks and eventually had to go with his third nominee.

3. Security is solid: The system is relatively safe, Portfolio.com opines, but expect some rancor over the body scans that are set to be implemented, as “the TSA is about to ratchet up the security kabuki at airport checkpoints.”

4. Travel consumer rights on the rise: It took 47 passengers getting stuck overnight on a Minnesota runway, but passengers finally got some rights. The airline industry warned of (self-servingly) of unintended consequences … which have yet to materialize. The Obama administration has airline fee structures on the agenda now.

5. Merger-mania managed: Despite the fact that the “balancing act is tricky,” the administration has done a decent job of facilitating healthy competition without impeding too much of the urge to merge.

[photo by jurvetson via Flickr]

Travel recovery watch: International travel and spending up says Department of Commerce

by Tom Johansmeyer on

Last May, 3.6 million non-stop air passengers left the United States, according to the U.S. Department of Commerce. Who cares? Well, the travel industry does, as this indicates an 8 percent year-over-year increase and the fifth month to show a gain since December 2009. The top outbound markets were Europe, the Caribbean, Asia and Mexico. Air travel was up for the Caribbean, Asia and Mexico, with Europe posting a decline of 1 percent year-over-year for the month of May. Departures to Mexico, the Middle East and Oceania showed the strongest growth: 68 percent, 19 percent and 12 percent, respectively.

For the first five months of this year, outbound air traffic ticked 3 percent higher compared to the same period in 2009, hitting 15.1 million. And, positive growth occurred in five of the eight overseas regions, the U.S. Department of Commerce reports.

While the growth story is solid, don’t forget that were measuring against a severely depressed baseline. Travel and tourism spending was in the tank last year, following the global financial crisis triggered in September 2008. Though the numbers are headed in the right direction, the road to a full recovery remains long.

What is interesting is that more Americans are traveling, and they’re spending more while doing so, showing that the travel market recovery may have some legs. U.S. travelers spent $2.4 billion on foreign air carriers in May 2010, a year-over-year surge of 19 percent.

[photo by uggboy via Flickr]

Are airline passengers getting ruder? Deal with it!

by Tom Johansmeyer on

Recent mayhem in the skies has obviously raised the question of whether passengers are getting ruder, and the consensus seems to be that we are. The average passenger may cite fuller planes, less room in overhead compartments and an endless array of fees as reasons for the lack of courtesy, not to mention an increasingly tough gauntlet from the curb to the gate. And, the cabin crew will probably lament the inability to work effectively with passengers who have increasingly absurd demands and hostile behavior.

What nobody seems to realize, however, is that this issue is not unique to the airlines.

Think about it: when times are tough for a company or sector, everyone becomes unhappy. Difficult market conditions leave employees stressed, as they worry about their jobs, don’t get raises and, as the cliché goes, have to “do more with less.” And, customers become increasingly demanding because every dollar they spend is more important, especially if you don’t know whether you’ll still have reliable income in the near future.
Does this sound like the airline industry? Of course. Passengers are looking at every expense carefully, whether they are traveling for leisure (personal expenditure) or business (where they have to answer to the finance department). They want more for less … and become frustrated by the fact that service and amenities are actually declining as ancillary fees are on the rise. This is the sort of situation that will make passengers ruder, and indeed, it has.

Meanwhile, there is no shortage of stories about flight attendant meltdowns. Some of the people involved, of course, were probably wacky before economic conditions worsened, but it’s safe to assume that the implications of the recession for the aviation business have contributed to the likelihood of the insane and the absurd breaking out among airline employees.

Now, let’s think about business in general, outside the airline business. The same rules apply. Customers and clients become more difficult, more demanding, when times are tough. Having conducted business following the bursting of two bubbles (dotcom and structured finance), I’ve seen – and experienced – just how challenging it can be to keep your cool. But, the smarter folks in just about any business find a way to do so. Why? Because they realize that without their clients, they’d have no cash coming in. So, there’s a lot of anger behind smiles, tongue-biting and carefully concealed strained patience.

What matters, though, is the commitment to service levels. Professionals realize that the rudeness of their customers or clients does not change their own obligations to deliver the necessary product or service. If they fall short, the revenue sources (rude or not) will dry up. And, it’s better to have rude people paying you than none at all.

In the airline sector or anywhere else, there is no tacit or explicit obligation for customers to be polite, except for common courtesy, which is convention more than obligation. So, are passengers getting ruder? Of course. Does it matter? Not at all.

[photo by hoyasmeg via Flickr]