Misery works: airlines making money on baggage fees

by Tom Johansmeyer on

The one thing nobody says about the “nickel and dime” strategy is that it can work. For the airline industry, charging passengers for extra bags translated to more than $1 billion in lifeblood to a struggling business last year, according to the Department of Transportation. As much as you may hate to shell out that extra cash, last year, it went to businesses that desperately needed it.

Before the financial decay spread to every corner of the business community last year, airlines typically allowed two pieces of checked luggage per person and charged for anything else that followed. Then, United Airlines started demanding that passengers throw down $25 for a second bag, with US Airways following to the tune of $15.

It adds. Up. United brought in an extra $133 million. Delta picked up an extra $177 million. American Airlines wins with $278 million last year from baggage fees. Even Southwest Airlines pulled in an extra $25 million. Rick Seaney, CEO of Farecompare.com, believes that baggage fees could be worth up to $3.5 billion in 2009.

March a good month for on-time arrivals

by Tom Johansmeyer on

We all love to hate the airlines, and on-time arrivals are among our largest gripes. There’s nothing worse (well, within reason) than seeing the toe-tapping that comes with the disgruntled looks of people waiting to pick you up … it’s not like they had to spend endless hours on the runway or circling LaGuardia. Well, in March, they weren’t as bad.

The 19 largest airlines in the country reported an improved rate of on-time flights compared to March 2008, according to some data from the Feds. Well, the bar wasn’t set very high. On-time results for March 2008 were 71.6 percent, according to the Department of Transportation‘s Bureau of Transportation Statistics and reached 78.4 percent this year. Before you get too excited, it’s down from 82.6 percent in February.

So, what does all this mean? Airlines were late almost a quarter of the time, and that includes the padding applied to routes. Aviation analyst Michael Boyd says that a flight from Binghamton, NY to New York City is scheduled for an hour and 15 minutes – not the 45 minutes it takes.

Aviation system delays were responsible for 7.3 percent of delays, with late arrivals from other planes kicking in another 6.5 percent. Factors within airlines’ control were responsible for almost 5 percent delays.

Extreme weather? A mere 0.62 percent.

New airline idea: goal is to beat the odds

by Tom Johansmeyer on

Columnist Jeremy Clarkson, at The Sun, has come up with a brilliant airline concept: take it easy, and play the odds. He laments the fact that it takes “about six years” to check in and considers the security process to be troublesome. They won’t even let you keep your toothpaste!

Of course, we have all this security in place for a reason. There are many threats to safety … and it’s not just terrorism. We’ve had smokers on Saudi flights, and drunk passengers remain a perpetual problem. Yet, what are the odds of being killed by international terrorism? Clarkson puts it at about the same as drowning in a bathtub. Since the 1960s, he continues, eating peanuts and being struck by lightning have proved more lethal. Worldwide, there are approximately 70,000 flights every day, with only 50 or so hijacked in the past 40 years.

With no security, this number is likely to increase. Even if thousands of planes are hijacked a day, he observes, more than 60,000 will land as usual.

This leaves the unfortunate question, though. Mr. Clarkson: are you willing to take those odds? One in seven?

Not me …

March airline plunge softens in April

by Tom Johansmeyer on

Passenger traffic is still falling. That’s not going to change for a while. But, the decline slowed in April, signaling that the prolonged sharp dips may be behind us. Some optimists even believe that the worst is over – though I maintain a healthy skepticism.

Note the metric being used: passenger traffic. There’s a lot of mileage between asses in seats and money in the bank. On a positive note, increased passenger traffic means that more people are spending money on travel. Of course, deep discounts are responsible in large part for the increasing traffic. The value of these passengers in dollar terms, therefore, is quite low.

United Airlines reported a traffic drop of 10.5 percent in April 2009 relative to the same month in 2008. Delta and American sustained smaller declines. Southwest, meanwhile, showed a 4.1 percent increase.

And, fares fell.

The average one-way domestic fare paid in the first quarter of 2008 was $213 – compared to $246 for full-year 2008.

For now, however, the airlines believe it’s better to sell seats at any price, especially if they have to put a plane in the air anyway.

Israel, Mecca … no difference to British BMI

by Tom Johansmeyer on

Passengers headed to Israel on a British BMI flight were alarmed to find their destination was Mecca, according to the in-flight map. The airline, it seems, isn’t terribly aware that the Middle East is know for a tiny amount of tension that’s lasted for decades (the most recent iteration, at least).

Pick your joke about “wiping Israel off the map” – the Sydney Morning Herald did.

BMI, of course, denies an anti-Israel bias and cites a technical screw-up. The carrier, which has operated low-cost flights to Israel for more than a year, says it bought two plans from a bankrupt charter company that focused on Muslim destinations. The in-filght systems were programmed to highlight Islamic holy places.

It’s not discrimination. Instead, it’s a careful blend, of laziness, stupidity and poor planning – all of which are excusable in the airline industry, right?