Heathrow CEO kisses bonus goodbye

The backups and mayhem at Heathrow, the largest airport in Britain, have come with a very personal price tag. With thousands of flights cancelled and crowds of disgruntled passengers forming, it only makes sense that there would be some consequences. So, while passengers look for ways to get to their ultimate destinations this holiday season, there will be a little less under the tree in one household.

Heathrow CEO Colin Matthews relented to pressure to give up his six-figure bonus because of the problems at Heathrow that exacerbated the impact of bad weather, such as claims that he didn’t buy enough de-icer, according to the Daily Mail. The report continues:

Colin Matthews bowed to calls to relinquish his six-figure bonus today amid claims bosses ‘failed’ to buy enough de-icer, ruining the travel plans of more than a million people.

It added:

Lord Jones of Birmingham said Mr Matthews, the owner of a ski lodge in the French Alps and a £1.9million west London home, should ‘not be getting a bonus when he has diminished Britain’s global brand’.

Matthews pulled in total compensation of £1.6million last year, £994,000 of it salary and benefits.

According to Matthews, “I have decided to give up my bonus for the current year.” He continued, “My focus is on keeping people moving and rebuilding confidence in Heathrow.”

Meanwhile, the Daily Mail says, passengers were forced to rely on tea and coffee handouts from the Salvation Army.

Flight cancellations are expected to continue past Christmas day.

[photo by smagdali via Flickr]

Airlines WRONG: Lengthy airport delays fall to zero!

Now that the stakes are high enough to matter, airlines are finally getting their collective act together. The U.S. Department of Transportation just announced that there were no tarmac delays of loner than three hours in October for the largest airlines in the United States.

You read that right: none. And, the air transportation industry did not fall apart. It did not fail to operate. Flights took off and landed … and passengers didn’t have to spend absurd amounts breathing stale cabin air while hanging out with the hope that Godot would finally show up.

This represents a drop from 11 in October 2009. In case you were wondering if airlines canceled flights rather than risk a fine of $27,500 per passenger for airport delays, note that the cancellation rate actually fell slightly year over year.

So, how much did the rate fall?

The largest airlines canceled 0.97 percent of scheduled domestic flights in October 2010, down from 0.99 the previous year. Even if you call this no change … well, that’s the point. With the stricter rules in place, there was virtually no change in cancellations.

October 2010 was the first month there were no tarmac delays of greater than three hours since the DOT started keeping score in October 2008. And, from May to October, according to the Bureau of Transportation Statistics, there were only 12 tarmac delays of more than three hours, based on data for 18 airlines. For the same period in 2009, there were 546.

Meanwhile, on-time performance improved rather dramatically from October 2009 to 2010, from 77.3 percent to 83.8 percent. That’s off a bit from 85.1 percent in September 2010, but still an indication that the industry is getting significantly better.

Chronic delays were down as all. The DOT reports:

At the end of October, there was only one flight that was chronically delayed – more than 30 minutes late more than 50 percent of the time – for three consecutive months. There were no other flights chronically delayed for two consecutive months and no chronically delayed flights for four consecutive months or more.

Just shy of 5 percent of flight delays were caused by aviation system delays, with 5.54 percent caused by aircraft arriving late. The number of delays within the airlines’ control (e.g., because of maintenance or crew problems) increased to 4.44 percent from 3.99 percent in September.

So, where can you see the real implications of all this? Well, let’s take a look at the number of complaints about airline service. It seems the threat of heavy fines is making these companies more responsive to their customers. The 749 complaints the DOT received from passengers represents a 16.5 percent decline year over year.

I know nobody wants to admit that the system works, but I guess it made air travel a bit more tolerable.

[photo by TheeErin via Flickr]

Airline fees never going away, $1.2 billion in first half

In the first six months of 2010, U.S. airlines raked in $1.2 billion – and that’s just from change and cancellation fees. The industry is on track to see $2 billion in revenue just on ticket-related fees this year.

According to the Bureau of Transportation Statistics, here’s where the money’s going:

  1. Delta had the most at $347.1 million in the first half of 2010
  2. American Airlines was a distant second at $235.3 million in ticket related change fees
  3. United Airlines pulled in $158.3 million
  4. US Airways generated $128.3 million from ticket fees
  5. Continental Airlines picked up $120 million

JetBlue didn’t hit the top five (finishing sixth), but it did lead the low-cost category in change and cancellation fees, with $55.7 million.

[photo by cliff1066 via Flickr]

One three-hour airline delay this summer … and the industry survived

The latest data from the Department of Transportation suggests that airlines are figuring out how to survive in a world of on-the-ground delays that can last no more than three hours. The summer travel season had only one delay that was affected by the rule. This is a 98.5 percent decline from the summer of 2009.

The airline industry mobilized, when faced with the prospect of the three-hour rule, to counter that there would be a substantial increase in canceled flights, as the threat of hefty fines would cause them to pull the plug. Yet, this hasn’t really happened either. Cancellation rates for the spring and summer were:

  • May: 1.24 percent
  • June: 1.5 percent
  • July: 1.43 percent
  • August: 1 percent

In fairness, May, June and July had cancellation rates higher this year than last, but August held steady, suggesting that it is possible to comply with the three-hour delay rule without sending cancellation rates sky-high.

According to MSNBC:

That’s an acceptable tradeoff, says DOT. “Although the rule has been in effect only a short time, we’ve seen no tangible increase in flight cancellations,” said spokeswoman Olivia Alair, “which means airlines are taking action to prevent delays without canceling flights, as some industry critics claimed they would.”

So, what were the dire consequences forecasted by the airline sector?

Those critics would no doubt include airline consultants Darryl Jenkins and Josh Marks, who published a report in July stating that the new rule would lead to an additional 5,200 cancellations per year (both directly and indirectly), at a cost to the public welfare of $3.5 to $3.9 billion over the next 20 years.

Jenkins and Marks stand by their projections, creating a situation in which the same data is leading to two perspectives. But, one thing is clear: in terms of percentage, flight cancellations have stayed consistently under the 15-year average for four consecutive months.

[photo by nafmo via Flickr]

10 Things Travel Insurance Won’t Cover

I’m a bit of a spaz when it comes to travel insurance. Which means, basically, that I’m always covered. Though I don’t do crazy things like bungee jump or swim in the ocean further than my feet can touch, I’m always worried that this is going to be the trip where I randomly fall out of a cab onto a busy street and wind up with a broken clavicle and it’s all down to a suspiciously missing metal piece in the door the size of a hairpin. Call it my mother’s influence. Call it getting older. Call it what it is: Paranoia. But whatever you call it, I aim to be covered, one way or another.

There are lots of people out there, like me, who depend on travel insurance for peace of mind. And it’s great to have that sense of assurance, but don’t be fooled into thinking that travel insurance covers every mishap you might have. Here’s a list of the top 10 things it doesn’t cover:

  1. Your tour cancels on you: Sure, you’re covered in case you have to cancel, but what if they cancel and leave you high and dry? Sorry — you might be out of luck
  2. Acts of War or Protests: A good reason to stick to a destination that’s not too tumultuous.
  3. Pre-existing medical conditions: If you had a medical condition before you left, whether you knew about it or not, and it acts up on the trip, you might not be covered. Get checked out and be upfront about your illnesses.
  4. Baggage Delays of less than 24 hours: Bring your toiletries and a change of clothes in your carry-on because you’ll only get money if your bag’s missing for more than 24 hours.
  5. Death of Pet: You can cancel your trip if Granny dies, but you’re outta luck if Rover heads to doggy heaven
  6. Loss/Damage to keys, documents, etc: Read the fine print to find out what is NOT included in the baggage or personal property claims
  7. Sports Injuries: If you break your leg mountain climbing, you might be footing the bill yourself
  8. Pregnancy and Childbirth: Check the fine print — some aspects of childbearing complications might not be covered.
  9. Psychological Illness: Paying out of your pocket for your trip after you have to cancel because of a nervous breakdown will only make things worse. If you have a history of mental illness, get the facts before you book.
  10. Divorce: If you divorce or separate before your trip, you might end up travelling together anyway — most insurance companies won’t let you cancel without a penalty.

Via Airfare Watchdog