Gadlinks for Tuesday, 1.12.2010

Happy Tuesday, everyone! Don’t let the midweek slump get you down. Check out these other sources for travel inspiration.

Get more Gadlinks HERE.

Gadling gear review – USA Today AutoPilot

The App Store is full of travel applications – I’ve got at least 40 of them on my iPhone, but many of them have a very specific purpose, and I’ll only need them once a month (or less). The new USA Today developed “AutoPilot” is one that has already seen more use than most others put together, and may even end up replacing my current favorite – TripIt.

AutoPilot is a Swiss Army Knife of travel applications. It offers the following features in one app:

  • TripIt itinerary integration
  • Flight tracker
  • Airport delay map
  • Airline/hotel contact database
  • Weather
  • Destination galleries (powered by Flickr)
  • Articles & experts (with USA Today content)

That first feature is pretty nice – you get a similar interface as found in the iPhone/iPod Touch TripIt application, with a couple of extra features thrown in (like the ability to email someone your itinerary).

To integrate with TripIt, you do a one-time authorization on a web page, which allows AutoPilot to access all your TripIt itineraries.

The flight tracker information shows up in your itinerary, but can also be searched using flight number, route or airport. The information delivers all you really need – departure (estimate), any delays, and arrival/departure gate information.

The airport status screen uses information delivered by FlightStats, and shows all known delays at US airports. Since this information comes directly from the FAA, it is usually quite accurate, and helps give a good idea how the rest of your day may look

I’ve included a brief gallery showing some of the various sections of this app. I’m loving the TripIt integration, and the extra content makes for a well designed application – a real “must have” for any traveling iPhone owner. Best of all, the application is free! You’ll find it in the App Store (iTunes link).


Are you paying for an airstrip of convenience?

Taxpayers are paying to subsidize several airports around the country. Many don’t service commercial passengers and do very little to add to the communities in which they reside. Take Williamsburg-Whitley County Airport in Kentucky. It was built with $11 million in cash from the U.S. government and usually sees only a handful of flights a day take off or touch down – some days, the runway is empty.

The source of this largesse? A federal program that few know about. To understand what’s going on, you’ll need to think back to the last airline ticket you bought.

You know the drill, there’s the price on the screen … and then there’s the price you pay. In addition to the fare, you realize quickly that fees and taxes can mount to seemingly absurd proportions, but you have little choice in the matter. The taxes alone can hit 15 percent of what you pay for a flight. Have you ever wondered where that money goes?

(Well, now you know that a piece of it goes to Williamsburg-Whitley County Airport.)

Some of the tax money from air travel transactions is used to build new airports and maintain others – a network of 2,834 in total in the United States – that do not service passenger flights. These “general-aviation” airports are separate from the 139 commercial airports in the country that take care of almost all passenger flights.

USA Today, which deserves a hell of a lot of credit for digging into this, reviewed the first full examination of the 28-year-old Airport Improvement Program and found that $15 billion was sent to general-aviation airports. That’s a considerable amount of cash to give recreational fliers a place to land.

In all fairness, there is probably some truth to the notion that these airports can attract commercial and residential development and provide some important services around medical transport via air, as some members of Congress insist. But, is it enough to justify the expense?

To Congressmen, perhaps.

USA Today reports that that “[m]embers of Congress took 2,154 trips on corporate-owned jets from 2001 to 2006,” per a 2006 study by independent research group PoliticalMoneyLine. Again, in fairness, some of these airports actually provide access to their constituents. But, should a taxpayer in San Francisco finance an airport in North Andover, Massachusetts?

However you quantify the utility, it seems as though the cost is a lot higher than the benefit.

Jonathan Ornstein, CEO of Mesa Air Group (a regional), tells USA Today, “Congressmen are spending millions building runways at these little airports. That is just a complete waste of money.” This is especially the case, he says, when “there is a huge requirement to overhaul infrastructure at major airports.”

Click here to read the entire investigation and analysis; it’s worth it.

Making sense of the airline industry

The situation is currently grim for airlines, having gone from “bad in January to ugly by March,” according to USA Today, mirroring the U.S. economy as a whole. But, some feel that the worst is behind us. At the same time, a decline in business traveler traffic may suggest that we have a long way to go.

That’s why I love USA Today … two perspectives for the price of one!

Let’s make one thing perfectly clear: airline executives are unanimous in refusing to state that a recovery has begun. Keep in mind that CEOs have to be incredibly careful whenever they speak. Something that’s interpreted as a prediction could be disastrous later. A prediction becomes a goal to be met, and failure to do so can have harsh implications on the stock price.

In case you don’t know, that means real people lose real money.

That being said, Delta, American and Continental executives allowed themselves some modest hope, suggesting that “at least traffic levels aren’t collapsing the way they did last year.”

For now, there’s little to celebrate aside from the hope that we’ve hit bottom. Continental’s revenue per available seat mile (RASM) fell 4.8 percent in January, 11.5 percent in February and 20 percent in March. April is likely to be down 13 percent to 15 percent.

RASM basically tells you how much revenue an airline pulls in for every seat flown. Let’s make it easy: assume that a plane has two seats and flies 100 miles. One passenger pays $200 and the other pays $100. The first passenger pays $2 per mile, and the other pays $1 per mile. It averages out to revenue of $1.50 per available seat mile.

Now, assume that we have a third seat … and it’s empty. So, we’re working with $2, $1 and $0. That’s RASM of $1 (as opposed to the $1.50 above).

Figuring this out for an entire airline for a full month is obviously much more complicated, but you can probably see the value in doing so. It’s a way to figure out just how productive every seat on every plane is – even the empties.

Delta’s perspective is that things aren’t getting worse right now, even if they aren’t good, and American believes that it’s too early to tell.

The decline in business travel is seen as a big part of the problem. Business travelers tend to spend a lot of time in planes, and they don’t always get the lead time to buy tickets (or prepare their families for long absences) that they’d like. As a result, they often pay more for tickets than vacationers, who have the luxury of planning ahead.

To keep expenses down, many companies are trying to cut their spending on travel, opting for other collaboration alternatives. While face-to-face meetings are nice, they tend to be a lot more expensive than webinars and conference calls. When you have to squeeze the budget, travel is an easy place to cut spending a bit.

I saw this firsthand during the last economic downturn (following the collapse of the “dotcom economy” and the terror attacks of September 11, 2001). I was a management consultant and flew every week. While my clients were willing to foot the bill for weekly travel, I found myself under a lot more pressure to find cheaper flights, stay at hotels that were less expensive (and less convenient) and take a taxi to the airport instead of driving and putting my car in the lot for a week.

Though business travel can be cut, it won’t go away completely. There will always be a need. While many cite conventions as a source of business travel, you’re more likely to run into weekly grind travelers at airports in this economic environment. Catch the first flight out of a major airport on a Monday morning, and you’ll see business and business casual attire, laptops clutched and weary looks. These people make the same run every week, returning home on a late flight Thursday or Friday. When you have a lot of people dropping $500 a week on flights – each doing it 40 times a year or more each – the airlines benefit. When they slow down, the airlines feel pain.

To compensate, as you’ve seen here on Gadling, airlines are coming up with more fees – and they’re not all as crazy as the Ryanair pay-to-pee proposal. Baggage charges seem to be most common, with Delta hitting up passengers for $50 to check a second bag on international flights (starting July 1, 2009). The airline hopes this will generate another $100 million this year.

Delta’s not innovating, here; it’s just the most recent.

The need is salient, given recently released first quarter financial results. JetBlue and AirTran stood out by turning profits ($12 million and $28 million, respectively), largely because the cost of jet fuel dropped. Take that out of the equation, and AirTran’s 31 percent revenue decline would have had a greater impact.

Meanwhile, US Airways posted a $103 million loss. Alaska Air Group lost $19.2 million for the quarter. Delta, American and United showed substantial losses, as well.

Leisure travel isn’t the primary driver, as fare deals have kept this section of the market fairly active, if less profitable. It’s the business travelers who are straining airline financial performance. It will take a turn in the economy to solve this problem. Any measures available to the airlines are more likely to slow the bleeding than repair the situation as a whole.

When will that happen?

Like the airline CEOs, I’m not crazy about making predictions, as my success is shaped more by luck than clairvoyance. But, I’ll take a small step out on a limb. Businesses will green light travel increases when they see an upside to doing so. When sales teams encounter big opportunities, they will be able to make the case to fly. This means that a client has to be ready to write a big check. Also, startup activity will result in the use of venture capital funding to hop on planes with the hope of pitching new ideas to clients interested in growing their businesses or realizing a cost savings.

You won’t notice it at first; these trends take a while to gain steam. Success builds upon success, with each win leading to several new opportunities and a willingness to fund travel for them.

Am I willing to throw a date or timeframe out there?

No way!

We’ll all have to wait and see.

How will your holiday travels go? Do some research with the Holiday Travel Cutback interactive graphic

For me to get home for Thanksgiving, I’m lucky enough to only have to take Amtrak. Even though train stations are popping at the seams with travelers during the November holiday weekend, airports are even worse. And this year is no different.

As a matter of fact, during this year’s Thanksgiving and Christmas travel periods, airlines will operate about 2,500 to 3,000 fewer domestic flights than compared with the same periods in previous years. That means that one way or another, you’re probably going to be affected. To visualize just how your travel plans might be impacted, USA Today’s travel blog Today in the Sky has put together an interactive graphic to show how flight cutbacks by airlines could affect your travel choices.

The graphic can be used to find flight changes for select days from every domestic airport with flights to the following seven hubs: Atlanta, Charlotte, Chicago O’Hare, Dallas/Fort Worth, Denver, Houston (Bush) and Minneapolis-St. Paul. The map is dotted with red and green squares to signify fewer or more flights to the hub, making it pretty simple to see what routes are going to be more problematic. But if you’re lucky, you’ll find that your particular route has that great green box, meaning that you’ll actually be able to take advantage of more flights to get you home for the holidays.

To check out the graphic for yourself, click here.