Market Share in NYC

September 24, 2013 on 1:20 pm | In Airline Service, Airports, Mergers and Bankruptcy | No Comments

In an unrelated story about United Airlines in the New York City area, some interesting statistics were noted by the Dallas Morning News.

The two SuperLegacy carriers, United Airlines and Delta, have 24.7% and 21.3% market share respectively.  No giant surprise but let’s look at what the next two airlines are in that market:

jetBlue:  13.3%

American Airlines:  12.3%

Yes, jetBlue beats AA in that market.  Let’s look at the next two airlines:

US Airways:  4.4%

Southwest:  2.8%

If we combined American Airlines, US Airways and Southwest in the NYC marketplace, we would have an airline with just 19.5% share of the market.  Still less than Delta and still considerably less than United.

And be mindful of the fact that SWA isn’t even considered a player in the NYC market as they’ve been unable to obtain gates or additional landing slots at the airports.

Care to guess who comes after Southwest?  That would be British Airways and Air Canada.  Yes, two foreign carriers are next in line with shares of 1.4% and 1.2% respectively.

On the tail end are Spirit and Virgin America with about 1% of the market each.

So when we talk about how there is an imbalance in the marketplace, let’s be mindful of the fact that the top two largest airlines (United and Delta) combine to own nearly 50% of one of the most competitive markets in the world.

And if you combined both AA and US Airways, they would still be at a significant disadvantage with just 16.7% of the NYC market.

I don’t disagree that the combination’s dominance in Washington D.C. should require divestiture of slots by those two airlines.

But the economic pricing power that the two SuperLegacy airlines have today are so great that they will gain more share over time rather than less with the current market conditions.  More of that market share means even more pricing power which means even greater increases in air fares.

But, hey, far be it for me to introduce rational thought in the US Airways / AA merger argument.

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AA should lose all slots at Washington Reagan National

September 13, 2013 on 11:37 am | In Airline Service, Airports, Mergers and Bankruptcy | 1 Comment

jetBlue CEO Dave Barger has decided that jetBlue *does* have a dog in the merger fight and has announced his (jetBlue’s) belief that American Airlines should lose all its slots at Washington Reagan National Airport if the merger goes through.

He means those slots held by AMR, not the new American Airlines.

He may even have a point but Mr. Barger would be well advised to pay close attention to what airports his own airlines dominates at before deciding he does have a dog in the fight.  That dog might bite him.

jetBlue holds a lot of slots at JFK airport and cooperates with American Airlines.

Maybe American Airlines (new) should have to discontinue its lucrative relationship with jetBlue due to dominance in the NYC, Boston and Washington areas.

Blatant land grabs are shameful no matter who makes them.  I realize that those slots are something all airlines covet.  If you cover them so badly, advocate a fair and equitable system for allocating them that remains dynamic over time.

 

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TSA Hijinks

September 10, 2013 on 1:51 pm | In Airports, security | 1 Comment

It’s been a long while since I wrote about anything involving the TSA but I managed to catch wind of an interesting little thing going on at a local (to me) airport.

Evidently 9 people were involved in a theft ring where employee parking passes were being stolen and re-sold at DFW airport.  These passes allowed people to use airport parking a great deal more economically, if you know what I mean.

What does this have to do with the TSA?

8 of those 9 people worked for the TSA.

Am I shocked?  No.  We have real world concerns about security in airports regarding legitimate threats to people.  There are real and tangible security threats that exist and are even focused on the US.

What’s our answer?  The TSA:  Our front line security against these threats.

At least when they’re not stealing from co-workers cars.

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Antitrust Thoughts

September 6, 2013 on 1:29 pm | In Airline Service, Airports, Deregulation, Mergers and Bankruptcy | 2 Comments

Over the past week, I keep thinking about a few things related to the US Government’s stance on the US Airways / American Airlines merger and, specifically, their cited concerns about the merger.  Here they are in no particular order:

 

  • The DoJ was remarkably absent when the Wright Amendment undoing was being done.  Love Field Airport was essentially made a single airline airport . . . forever.
  • American Airlines now controls the following terminals at DFW International Airport:  Terminal A, Terminal B, Terminal C and parts of Terminal D.  The remaining terminals available to other airlines are . . . Terminal E
  • Delta . . . Atlanta . . . enough said.
  • No one seems to be trying to preserve flights to and from small cities in other parts of the country but anyone who wants to remove silly flights into Reagan National is deemed a danger.
  • Delta . . . Minneapolis . . . enough said.
  • Delta . . . Detroit . . . enough said.
  • United . . . Houston . . . stranglehold.
  • Southwest . . . Love Field and Midway airports

By the mandate cited by the DoJ, the antitrust department would appear to have a strong duty to investigate and correct these defects as soon as possible.

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One Simple Solution

September 1, 2013 on 1:00 am | In Airline Service, Airports | No Comments

A big part of the Department of Justice’s complaint about mergers is the concentration of airlines at major hubs and, most particularly, at slot controlled airports.

Well, even more specifically, they don’t want to see US Airways stranglehold on Reagan National Airport to change.

Wait.  What’s that you say?  DoJ wants them to give up slots?  Well, no, not exactly.

The DoJ approved US Airways getting their stranglehold.  The DoJ likes the stranglehold that US Airways provides.  It just doesn’t want that stranglehold changing.

This is the crazy that slots produce.  And it’s why I continue to believe that slot controlled airports need to periodically put all the slots up for auction for use for a set period of time.  Yes, I want an auction to lease those slots on at least an annual basis.

Why?  Because it does improve competition.  Airlines who wish to gain access can, at the right price.  At the same time, no airline will have an incentive to buy a slot and then use it inefficiently.

Right now, airlines are serving these airports with slots they are considered to “own” and use these slots to serve routes to hold control of an airport instead of, you know, earning an appropriate ROI on the route.

When a commuter flight between Charleston, WV and Reagan National provides 30 fares vs using that same slot for a flight between Reagan National and Dallas which has maybe as much as 130 fares being charged, you start to see the inefficiency.

But for some reason, no one wants smaller communities to lose those flights to the seat of power.  I do.  Those flights can’t yield enough to be efficient and should be relegated to flying to Washington Dulles airport instead.

It’s the idea of slots being owned by airlines that I object to.  I think they have to exist but I also think that the government should be earning money from them and they should be regularly available for re-allocation according to what someone is willing to pay for them.

I don’t wish harm to small communities but it’s time to recognize that there needs to be more cost efficient ways to serve these destinations as well.  Providing these cities with high frequency non stop flights each day is inefficient.  It’s time to allow the market(s) to find other, better ways to serve these cities.

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Let’s talk about competition, airlines and taxes: Part 3

August 19, 2013 on 1:00 am | In Airports, Mergers and Bankruptcy | No Comments

This very same government, the Obama administration, along with this very same set of Congressmen who all profess great dismay at airlines and who offer that they are there to protect the consumer have ignored their role in what I would describe as a blatant shakedown.

It’s called the ever increasing taxes on airlines and travel.

Taxes have increased so much that they can represent from 15% to 20% of the cost of an airline flight to someplace in the United States.  Taxes are focused directly on the consumer and the consumer, the person who is actually flying, is being asked to bear the whole burden of the infrastructure necessary for commercial airlines.

The taxes are so great that they now *do* impact the decision to travel.  In fact, the taxes are often so egregious that they represent the highest portion of the increased cost to travel today.  They are grossly impacting the ability of airlines to win customers and stabilize their business.

Indeed, our current government’s inability to get its act together on sequestration has materially and substantially affected the airline industry this year in that we are seeing slight negative growth as a result.

The argument that a user should pay for an airport seems logical to many at first glance but consider the rather dramatic and powerful economic impact a major airport has on an area.  Consider what the D/FW area would be if DFW airport did not exist today.  Would ExxonMobil be headquartered here?  Would we be a major tech center?  Would bankers still want to bank here?  Would we have not one but 2 major airlines here?

We all benefit from these airports and airlines and the ability to travel.  It’s time we all share the burden of that.

So, if we truly are worried about the consumer and the financial impact on them. . .

. . . Could we please redistribute the taxes in place and share the burden more fully all around?

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To the City of Irving: What? Are you stupid?

August 6, 2013 on 1:00 am | In Airports | 1 Comment

A developer wants to build 600+ homes right next to the eastern runways of DFW airport in the Dallas suburb of Irving.  Oh, and these homes are to be valued between $350K and $500K which is a *very* nice home in that area.  Extremely nice.   Here is the area:

 

[googlemaps https://maps.google.com/maps?hl=en&ie=UTF8&ll=32.902975,-96.998806&spn=0.029438,0.037551&t=h&z=15&output=embed&w=425&h=350]

What?  Is Irving stupid?  This shouldn’t have made it past the City of Irving planning commission and certainly shouldn’t be under review by the City Council of Irving at all.

As you can imagine, DFW airport is unamused by this idea and they should be.  When DFW was built, it was built in a location that was evenly located between Dallas and Fort Worth and where noise and impacts to homes would not occur.

Now, over the last 4 decades, that has changed.  But you can encroach on this airport which is arguably a huge economic driver for the region with homes and expect to later force regulations on the airport.

This is absolutely silly.

Why do I think that the City of Irving will come back on DFW about noise?  Because they’ve done it several times in the past.  As have cities such as Euless and Grapevine.  Cities that were largely unoccupied tracts of ranchland when the airport was built and which grew in large part due to the airport have regularly tried to stop the airport from operation and expansion many times.

As someone who lives in this area, I am unamused at cities causing this kind of trouble because the next thing that happens is these very same cities engaging in legal actions against the airport which cost me, as a regional taxpayer, considerable money.

No thanks.  And if you live in this area, I would suggest you get very vocal with your own local city council representative.

For reference on just how noisy this is, take a look at this video made by DFW airport:

 

 

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International Bright Young Thing

May 5, 2013 on 1:00 am | In Airline Service, Airports, Mergers and Bankruptcy | No Comments

100 points if you know the title reference.

Southwest Airlines is making incremental progress towards going international with steps like instituting flights to San Juan, Puerto Rico and rebuilding Houston Hobby Airport into an international gateway.

Some think that San Juan is international travel.  Not so much.  It’s a US Territory but, hey, it’s in the Caribbean and many of its residents speak Spanish.

Southwest will embark on travel to Caribbean and Mexican destinations over the next 2 years as it replaces Airtran flights with its own.  To add density to those destinations, Southwest is eyeing other destinations in Central and South America that are within range of its 737-800 ETOPS aircraft and which could be served well from Houston, TX.

It’s got some things to do before that happens.  First, it needs to build that international terminal fast.  Second, it needs to build an international reservations system and it’s got Amadeus working on that part.  Sabre is working with SWA on its domestic system and while many think that Amadeus might take over SWA, I do not.

The bottleneck isn’t going to be that terminal, however.  It will be the IT systems . . . again.  Southwest still hasn’t gotten things kicked into a gear with a Big Boy reservations system that will permit it to interface with other airlines or travel systems.

More importantly, it’s time SWA rework its own website which certainly met the needs of its travelers in 1999 but it really does not now.  It’s time to build a travel site that shows the opportunities for travelers instead of being a place that continues to look “temporary” when it comes to booking a flight.

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Knives on a Plane

April 8, 2013 on 1:00 am | In Airports, security | 1 Comment

Several weeks ago, the TSA decided to revise its position and allow knives, among a few other things, to be carried onto an airplane.  These knives couldn’t be more than what would be described as a common pocket knife.

Since then, quite a few people have weighed in on this decision publicly and I had decided to leave it alone because I felt the decision was really immaterial to any debate on security.

But I read Bob Greene’s opinion piece on CNN and I’ve changed my mind.  I want to weigh in.

Bob Greene is an idiot.

I say that because Bob Greene essentially calls Janet Napolitano, Homeland Security and the TSA idiots.   Let’s be clear here:  Bob Greene, a journalist and columnist with many years of experience, has decided that he has better judgement than the experts who have exposure to all the facts.

Here is an example of Bob Greene’s good judgement:  Bob Greene Wiki

He also makes a specious argument in his piece when he says that the tragedies of September 11, 2001 were caused by knives.

Well, they weren’t.  Knives were the instrument used by terrorists to take over multiple aircraft and were used to assault and kill flight crew.

Curiously, those terrorists didn’t succeed because they had knives.  In fact, if the tragedy wasn’t so tragic, the reason for their success is nearly comical.  They succeeded because we had spent more than 3 decades telling people to cooperate with hijackers.

Globally, we had told people that their best chances for survival when their transportation was hijacked was to cooperate.  More specifically, to shut up, do as told and to not try to interfere with the hijackers.  We, as a global community, couldn’t have been more of one voice on the subject.

Every airline (with the exception of El Al) told its crews to cooperate fully, get the aircraft on the ground and do your best to provide an opportunity for someone outside the aircraft to solve the problem.

And it was an incredibly successful strategy.  Few people got hurt, there were very few violent episodes and it worked very, very well in getting innocents away from danger.

The terrorists used our policies against us.  It wasn’t the box cutters they carried that killed people on those aircraft.  It was the “cooperate” policies that did this.

It’s actually extremely difficult to kill someone with a box cutter who actively resists.

When we found out what the hijackers did on those aircraft, I made the statement to several friends the first night that we’ll never see another successful hijacking in all likelihood.  I speculated that we may well see aircraft bombed or hit with missiles but that I didn’t think we would see one successfully hijacked.

And so far, we really haven’t.

Passengers immediately began actively responding to threats in the cabin and restraining people who intend harm on an aircraft.  It works, too.  In fact, those passengers have never gotten seriously injured either.

Our cockpits are now guarded with very strong doors that can withstand human force very well.  Our pilots won’t be acting passively either.  In fact, I fully agree with the idea of pilots being allowed to carry weapons in the cockpit and I think it should be encouraged.  Pilots should be trained to use them as a defense if that door is penetrated.

Knives aren’t a threat on aircraft.  No more so than many items that are already on that aircraft.  There are countless items that exist on airplane that could be turned into cutting weapons that are at least as good as a pocket knife.

Now, in a rare exhibition of sanity, the TSA has rightly realized that it needs to focus on real threats in security lines and eliminate some aspects of the security theater that have been going on.  And for their trouble, they get the likes of Bob Greene attacking them.

I have not approved of most of our security theater for the past several years in this blog.  There have been a number of steps taken to drive the perception of security while not providing any enhanced security at all.  I have vocally criticized those moves many times.

If you think you’re safer flying on an airplane in which pocket knives are banned, I have request:

Don’t fly.  You’re really too ignorant to be allowed on an aircraft and, frankly, I cannot trust you to do the right thing should there be a real emergency.  Take a car, please.  Or a train.

And if you think Bob Greene is qualified to call a entire security department of the United States idiots, then I would ask that you definitely not travel at all.  You’re a risk to too many people.

Personally, I would like to urge Bob Greene to go back to what he arguably does extremely well:  Personal interest stories about real people.

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FAA Tower Closings

March 24, 2013 on 12:16 pm | In Airports | No Comments

Hey, here is a quick, dirty little secret about the FAA tower closings at airports around the country.

They really don’t impact things much.  Seriously.

The air traffic control systems aren’t closing and those using these smaller airports will still get guidance to a final approach to these airports.

They will just have to coordinate their arrivals and departures between themselves and that’s done already in many places.  Particularly late at night.

It’s not even necessary to discontinue airline flights to these airports.  Airlines can fly into these airports safely and without trouble.  There is the chance that flights to these airports might necessarily get cancelled more frequently in bad weather but the typical flight shouldn’t be affected at all.

For those of you who think this still might be unsafe . . . it’s not uncommon for regional flights into rural airports late at night to arrive under the exact same procedures that will be used for these airports with tower closings.

Yes, it will require a change in procedures on the part of pilots (which they are already trained for) and it will possibly slow traffic into and out of these airports.  And who cares?  These airports aren’t exactly busy in the first place.  That’s why they are on the lists for closure.

Go about your business.  There really isn’t anything to see here.

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Braniff Maintenance Centers gets reprieve

March 3, 2013 on 1:00 am | In Airline History, Airports | 1 Comment

Back in November 2012, I wrote a blog entry titled The City of Dallas Hates Love Field, a story about one party trying to re-use the Braniff International Maintenance Building and the City of Dallas trying to tear it down so it could continue with its plan to make Love Field a non-airport.

Since that time, there have been many people leading a fight to get the Braniff Maintenance Center listed for eligibility into the National Historical Register for preservation.  In fact, I’m delinquent in writing a follow up to encourage people to contact The Texas Historical Commission to urge them to find the building worthy of preservation.

Frankly, with what I know about Dallas politics, I didn’t have much hope for saving this building.  When Dallas politics decides it wants something, it usually finds a way to have it regardless of who objects.  We’re not a corrupt city but we’re a cold blooded one when it comes to business.

But, hey, guess what?

Those guys did it.  The Texas Historical Commission has issued the Determination for Braniff OMB 7701 Lemmon Avenue and the building has been deemed eligible for inclusion into the National Historic Register.  Now there is a year long process called a Section 106 review that is performed to actually put the building into the National Register.  The real mountain, apparently, was getting it deemed eligible.

Congratulations to the group who went to work on making this happen.  You have managed a very rare victory in my opinion.

And that sound of something being unwrapped?  That would be the Airport Director getting out some antacid tablets because his deal to turn Love Field Airport into a non-airport just suffered a major setback.

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Competition at DFW

January 13, 2013 on 1:00 am | In Airline Service, Airports | 2 Comments

About a year ago, a few airlines started to enter the DFW market and that made me thrilled.  For all too long, American Airlines has dominated virtually all routes from Dallas / Fort Worth to all other destinations.  It’s even been able to manage keeping its pricing up on intra-Texas flights against Southwest.  The last time a truly competitive fare was found in Dallas was when Delta was still here operating a hub.

I saw the entrance of Virgin America on routes between DFW and LAX/SFO as a great start and American Airlines clearly didn’t like the competition because it did what it always does and tried to scare away the airline.  Virgin America CEO David Cush has never said anything but glowing things about VA’s performance to and from DFW.

JetBlue came to town as well with 3 flights to and from Boston.  Boston is a route that is, again, dominated by American Airlines and which had very high fares and by all reports, those flights do very well, too.

Spirit Airlines has come as well and they’re killing it.  Spirit has been adding routes and now is adding a crew base in Dallas because it’s discovered an untapped demand that is the result of very little competition in Dallas.  Hey, folks who live here like a good deal as much as anyone when it comes to a leisure destination.

But a year later, I see two airlines (JetBlue and Virgin America) maintaining their status quo.  I wonder what it is about the middle of the United States and Texas that scares these two airlines so much.  Particularly when you have a major legacy carrier sitting here airling and another LCC carrier (Southwest) raising fare prices in this market considerably.  There is some low hanging fruit.

If I had been Virgin America, I would have targeted Dallas for routes on LAX and SFO for sure.  I would also have laid on flights to New York City and Washington D.C.   I would have opened up a gate in Chicago and connected LAX, SFO, NYC, Washington, D.C. and DFW to Chicago in a heartbeat.

If I had been JetBlue, I would have added flights to New York City, not just Boston and I would have looked at some point to point flying to its Caribbean destinations as well.  We’re as close to the Caribbean as anyone in the Northeast and it’s a popular vacation destination for this area.

But it hasn’t been done.  A year later, these two airlines sit with their timid schedule into and out of Dallas from their strongholds while AA prepares to come out of bankruptcy as a cost competitive airline that potentially is mated with US Airways.  I would have spent the last year building loyalty on routes that those airlines could serve well by offering the fares people want here and getting them just a little too addicted to excellent service on modern aircraft.

It’s disappointing to me, the consumer, because I think that DFW is a destination where a lot of “upstart” airlines could succeed more.  The fear towards AA and SWA defies my imagination at this point.  And there is Spirit Airlines who is taking advantage of the moment and growing like crazy.  Go figure.

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The City of Dallas Hates Love Field

November 15, 2012 on 9:09 am | In Airports | 1 Comment

Love Field Airport in Dallas has been a source of a lot of pain for the City of Dallas and, in particular, the city council.  It was an airport that was supposed to go away and thanks to Southwest Airlines, it’s an airport valued by quite a few people even today.

I’ve never understood why this city hates its airport as much as Dallas does.  When I worked at Love Field in the late 1980′s and early 1990′s, the disrepair that much of those facilities were in was shocking.  It was if the landlord was doing everything it can to make the airport unattractive so that the one tenant hanging on (Southwest) would just leave, damn it.

Even after the compromise on the Wright Amendment, we’re not seeing Dallas build an excellent airport designed to serve the needs of the area, it’s building an airport designed to constrain operations at the airport.   When I look at how Dallas treats Love Field and compare it to, say, Midway Airport in Chicago, I become ashamed of the greater Dallas Metroplex and it’s attitude towards an asset that could be a jewel.

Love Field has some history to it.  Braniff’s Dallas Operations and Maintenance base building is located on the east side of the airport on Lemmon Avenue.  It was an airline building with many firsts and for quite some time represented the connection between Dallas and its airline, Braniff International.

The building was occupied and used even after Braniff’s bankruptcy and dissolution but has been unoccupied for about 20 years.  Now the city wants to tear it down.

I’ll be honest, I’m not completely invested in the idea that that building must remain at Love Field.  I am, however, invested in the idea that Love Field should be developed and related businesses ought to be encouraged and focused in a manner such that the airport looks more like an asset that represents a strong city.  The eastern side of the airport along Lemmon Avenue isn’t that attractive today and hasn’t been for 25 years.  That’s the city’s fault.  It ignored the airport and the properties along that side for years and largely because the neighborhood immediately bordering that side is comprised of very long income families.

Or it was until that neighborhood started to be revitalized.

Here is the building today:

A not for profit organization has started a campaign to save this building.  The Flying Cr0wn Land Group has this website:

http://www.savebraniff.com/

They have submitted numerous proposals to the City of Dallas’ Director of Aviation, Mark Duebner, whereby the property would be taken over, re-developed with the existing building and done at no cost to the city.  They want to preserve the building and use it for mixed businesses and even preserve the Braniff name in its remodeling.

They have investors lined up, a list of tenants lined up and have made several attempts to get Mr. Duebner to pay attention.  Curiously, he has refused to do so over and over and over again.

I also just like these guy’s plans.  It’s an attractive idea, it fits better than a car dealer and we ought to take chances on the out of the ordinary idea because it is those ideas that can often become the germ of real revitalization.

Now I understand why.  Mr. Duebner has made a deal with a Dallas BidnessMan, Randall Reed, to demolish the building and redevelop it into a Lincoln car dealer as well as a hanger and fuel farm.  A car dealer is the last thing Lemmon Avenue needs more of.  If you live in the Dallas area, you know this.  And it doesn’t strike me as “good” for the city’s Good Neighbor Policy towards surrounding residents either.

What’s the difference between a garish car lot and a redeveloped business center?  One hell of a lot.

Can the Flying Crown Land Group truly do all it thinks it can do?  They appear to have a plan, they assert they have the money lined up necessary for development and they not only submitted a proposal that exceed that which Randall Reed has proposed, it’s better in tax revenue for the city and better for the neighborhood.

So why are we ignoring this?  What harms comes to the city when a building that is BUILT FOR THE AIRPORT AND IS CONSISTENT WITH ARCHITECTURE AND THE SURROUNDING CITY ARCHITECTURE is kept and made new and useful again with the same or better tax revenues?  How does the city benefit with another car dealer and particularly so on Lemmon Avenue?

I smell a rat and I suspect that smell may be coming from those running Dallas’ airport.  Pay close attention because if the razing occurs and the deal is done with Randall Reed, I would ask us all to find out who Mr. Duebner is working for one year from now.

So, I’m going to ask something of readers I’ve never asked for.

1) Please forward links to this blog entry to your aviation friends.  Create a stir and I don’t care if you know someone in Dallas or not.  Let’s get Dallas people aware of this brand of stupid by creating as much of a stir as possible.

2) Go sign the petition.  Particularly if you are local to Dallas.  Save Braniff is the link.

3) Contact your Council-Critter on the Dallas City Council and protest the stupid. It’s your airport and you do have a voice.

4) Call Mr. Duebner and ask him how his brand of stupid is better for you, a Dallas citizen.  His office number is (214) 670-6080

You can also read stories in the Dallas Morning News about this Here and Here.

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Houston Battle

May 11, 2012 on 1:00 am | In Airline News, Airline Service, Airports | No Comments

Southwest Airlines wants to build a small international terminal at Houston Hobby airport and thinks that doing so will benefit Houston with more jobs, more economic impact for the city and everyone wins.  United (Continental) Airlines doesn’t want a damn thing going on at Houston Hobby and definitely does not Southwest Airlines beginning international flights from that airport.  United thinks that allowing this will reduce jobs, have a negative impact on the economy and, well, HOUSTON SHOULD JUST DO WHAT UNITED WANTS BECAUSE WHAT’S GOOD FOR UNITED IS GOOD FOR HOUSTON.

It’s like watching Southwest Airlines and American Airlines fight over Love Field airport in Dallas.

Make no mistake, this fight is over competition.   Southwest provides LCC competition on international flights from Houston to Mexico, Central America and the Caribbean and that is United Airlines’ major domain from that airport.  In fact, those United routes are a huge profit earner for the airline.  Of course United doesn’t want the competition.

Airlines, especially SuperLegacy airlines, hate competition.  And they loath competition on the very routes that earn them the most money.

Here is my take:  Southwest wants to introduce more flights to Houston Hobby.  In the process of introducing international flights there as a kind of “hub” for SWA International operations, it will almost certainly introduce more connecting flights to more SWA focus cities such as Dallas, Atlanta, Chicago, Baltimore, Los Angeles, etc.  This is a good thing.  Southwest has a great product and one that isn’t going to negatively impact Houston.

United Airlines has major investment in their fortress hub at Houston Intercontinental from commitments made by Continental Airlines pre-merger.  Houston Intercontinental is a fortress hub for them like DFW is a fortress hub for American Airlines.  Fly into IAH and you’ll be amazed at how dominated that airport is by one airline.  It is a crown jewel of hubs and the last thing United wants is an airline poaching customers from those routes.  But one reason why those routes are so profitable for United is that there is virtually no competition.

Competition is good.  Houston should allow Southwest to build its 5 gate international terminal.  It will benefit Houston and if United isn’t quite so profitable there, so what?  I don’t think there will be a massive increase in overall traffic to international destinations served by both airlines a la “Southwest Effect”.  I do think that SWA will poach quite a few customers locally and I say that what benefits the businesses and private parties of Houston is far more important than whether or not United gets to have its cake and eat it too.

The airlines are actually similar in labor costs but SWA maintains higher productivity.  It’s not as if United doesn’t have a fighting chance against SWA, it does.  For one, it has a frequent flier program that will be stronger for Houston residents most likely and it has the ability to feed as much traffic as it wants through Houston to southern international destinations.

The one party here that I do not think gets hurt with this is the city of Houston.

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Another day, another dollar

February 6, 2012 on 1:00 am | In Airports | 1 Comment

According to media reports a TSA screener decided to help herself to $5000 in cash from someone’s jacket as it passed through security. 

Let’s take a moment to think about the brazeness of such a thing.

Now, think about this:  How much does it cost to corrupt an FBI agent?  How much would it cost or what would have to be done to corrupt an Immigration and Customs agent?  How about your local police officer?  In almost all cases, it’s pretty hard to put a price on that kind of act for most people.

What we do know is that when law enforcement people are poorly trained and poorly paid, the most we can expect is justice at a price and the worst is corruption. 

So, if a TSA officer thinks its quite possible to take $5000 from a passenger putting a coat through security, how much would it cost to corrupt that TSA officer into permitting a threat to security to pass through unnoticed?  Probably as little as $5000 is my guess.  And that’s pretty cheap to a terrorist, I suspect.

If a TSA officer is willing to steal from passengers and if a group is found to continually have such lapses in a particular airport such as JFK in New York City, how good is our security?

Damn bad in my opinion.   And instead of addressing security theater, our department of Homeland Security continues to insist that the vast majority of TSA officers are good.  That may even be true but it would appear that there is enough of a rotten core to certainly be a serious weakness in security. 

After flying for most of my life and that equates to approximately 41 years of flying, I feel no safer today than I did at the beginning and, in some ways, I feel a lot less safe because we don’t require ethics, training and strong morale in our security.  Instead, we require sexual assaults in order to be permitted to get on an airplane.

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Lost Luggage

December 22, 2011 on 1:00 am | In Airline Service, Airports, security | No Comments

Short of tarmac delays, lost luggage drives more hate of airlines than just about anything else I can think of.  I frequently hear stories from people about their bad experiences with lost, misplaced and stolen luggage and, to be honest, I generally discard them as data points to evaluate airlines by.

I’ve been flying since I was 2 years old and I have flown as many miles as any of today’s frequent flyers.  In that time, I’ve had luggage delayed or misplaced maybe as many times as can be counted on one hand.  I’ve had luggage completely lost once and, believe it or not, that was on a train, not an airline.

With a few exceptions, I check my luggage.  I have no interest in making my life more miserable navigating airports and flights with it. 

There are times when airlines not only get it wrong but get it wrong consistently.  US Airways wasn’t particularly good for quite a while in Philadelphia, for instance.  London Heathrow has handled such things very badly at times as well.

To the traveler, I say this:  planning for the event that has less than one percent chance of happening will only stress you out more than a single incident of it actually happening.   And if you can’t afford to check your bag, you can’t really afford to travel. 

Now, with all that said, I also think airlines do an atrocious job of handling these problems.  Airlines have never handled the problem well and they’ve only gotten worse at it by compounding the problem with luggage check fees. 

I’ve said it before and I’ll say it again:  No airline should be charging a fee to check at least the first bag and as long as that bag is within some reasonable weight limit (50lbs domestic and 30lbs international strikes me as fair.)  The very nature of getting on an aircraft to go somewhere implies that a passenger is carrying luggage.  It’s silly and insulting to the traveler.

And to charge that fee regardless of whether or not you have delivered the bag with the traveler at the same time is also insulting.  If you want to charge fees, you need to be prepared to answer appropriate for not providing that service.  Airlines aren’t unique in that service sense.  Do we expect to pay for a meal that is 2 hours later at the table in a restaurant?

Furthermore, not doing your job in delivering the luggage with the person can impose an expensive, time consuming and challenging problem upon people.  Denying reasonable compensation in a timely manner is just wrong.  Plan for the expense and fix the problems causing the losses.

Writing complex and unfair clauses in your contracts of carriage is wrong.  I’m not sure the rules in place today are exactly fair to the airlines at times but they are the present rules.  Not following them or trying to sidestep them is wrong.  It’s bad business to cheat your customers.

There should be a time limit to how long an airline has to find your luggage and return it to you.  That should be something like 48 hours for domestic losses and no more than 5 days for international losses.  After that, you pay reasonable claims. 

I don’t think it particularly fair for a person to be able to pack $10,000 worth of items in a suitcase and then claim their loss entirely either.  But my solution would be to suggest to airlines that you charge insurance for any luggage exceeding $1000 in value.  There, I just gave you a new revenue stream and an opportunity to keep passengers happier and more secure.  Want to pack your Apple laptop in your luggage?  Go ahead but take out $1500 in insurance at, say, $10 per trip against this loss. 

And prove you actually put the expensive items in your suitcase. 

The dirty secret in this business is that you, the customer, have a long history of inflating the value of your possessions during a claim.  Suddenly a $200 Canon point and shoot camera becomes a $1000 Nikon in a claim.  That wrong and it’s fraud.

I also think airports and the TSA have a *strong* duty to keep luggage secure while transiting airports.  I know of already too many incidents where luggage secured with TSA approved locks were pillaged for their expensive items and then RELOCKED AND PUT ON THE PLANE.   That’s theft and only people with TSA lock *keys* are able to get into those bags. 

More transparency, fairness and insurance is required on all sides.  Everyone needs to quit addressing the problem with greed and most could stand to quit taking it personally.  Even airlines have a bad problem of acting as if they are victims over any lost luggage and they aren’t.

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Tarmac Delays result in first fines

November 21, 2011 on 1:00 am | In Airline News, Airports | 1 Comment

The FAA is going to fine American Eagle airlines a negotiated amount of $900,000 for tarmac delays during a day of storms in Chicago on May 29th.  The storms moved through the area more slowly than anticipated and several America Eagle flights bumped into the 3-Hour window.

This is the first announced fine for breaking the 3-Hour rule and it has some implications in that it sets precedent for other airlines going forward in the future.  My first impression is that this fine was a touch heavy on American Eagle.   It certainly is a non-trivial sum and when you consider the thin margins of a regional airline, it certainly makes an impact.  If every regional flight earned $500 in net profit (and they don’t come close to that in the real world), it would take 1,800 flights to earn that fine back.  Consider that for a moment.

On the other hand, American Eagle is by far the worse violator so far.  It has twice as many of these delays as the 2nd place leader, Delta.  

I think this fine has  huge implications for JetBlue and its violations during the October snow storm.  You can bet that JetBlue will be scrambling to defend itself over those delays.  Sadly, there is quite a bit of public perception already going against JetBlue in that instance and perception can often be a great influence in such fines.

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Security Theater

September 19, 2011 on 1:00 am | In Airports, security | 1 Comment

28 TSA officers were fired in Hawaii in addition to one or two who quit before being fired all because baggage was allowed to proceed to airplanes without screening for explosives.  Reportedly these lapses went on for as long as 4 months.

Just a week ago, it was reported that TSA officers in addition to other law enforcement officers participated in a drug ring that saw thousands of prescription drugs flow through airports from Florida to New York via airlines. 

Tell me again how the TSA is doing a professional and responsible job?

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September 11

September 11, 2011 on 1:00 am | In Air Traffic Control, Aircraft Development, Airline News, Airports, security | 1 Comment

There are quite a few blog posts showing up in the past few days memorializing or offering recollections on what September 11, 2001 was like for them.  I frequently struggle on anniversaries like this because I find myself out of sync with many others and with respect to this event in particular.

Make no mistake, it was a very bad day and I felt the trauma as much as anyone.  However, I tend to want to see us move on and do better as opposed to continue to only reflect back on what happened.  That said, I do think some reflection and observation on this particular anniversary is, perhaps, in order.

My day was absolutely normal when it started.  I woke up cranky as I often do, made coffee and drove to work.  I was just a few minutes later to work than perhaps normal but for no other reason than I was tired.

It was my custom to listen to the NPR news broadcast in the mornings (and still is) and I was doing so as I drove into the parking lot of my company around 8:30 or so in the morning.  As I did so, the news broadcaster, Carl Kassell, interrupted his news reading, hesitated and then said that there was a fresh news report that a small aircraft had hit the World Trade Center.

I was a bit surprised to hear that but immediately concluded that New York must be experiencing very low cloud cover and/or fog and someone must have finally done something badly wrong in that airspace. 

But it didn’t stop me at all.  I went into my office, closed my door and began reading emails and doing work.  I generally don’t like to talk in the earliest part of my mornings and my staff was accustomed to me doing those things behind a closed door.  Sometime after 9am, one of my staff opened my door and asked if I did not know that the world was on fire. (or words to that effect.)

I was surprised at her distress, started asking questions and got news going on my computer.  It took just a couple of minutes to learn that one hijacked aircraft had gone into the World Trade Center, not a small civil aircraft and that other aircraft were known to be hjacked as well. 

Then we learned of the second aircraft and things just seemed to get blurry for a while.  Our news feed slowed to a crawl because the internet was overwhelmed.  We were able to get a portable TV going and got some news from that.  I went to my car a couple of times to listen to the radio as well. 

After a couple of hours, there was news that parents were pulling their kids from school and I announced that those who wanted to leave and do the same, could.  I also offered that it might be best for us to stay where we were for a while longer until we knew that someone had a handle on something.  We stayed for a bit longer but it became clear that no work would get done and I let everyone go home.

I went home as well. 

I worked near Addison Airport in the Dallas area.  I lived under one of the normal approach paths for Love Field and DFW airports.  It was immediately striking just how quiet things grew both in the air and on the streets.  Like most of everyone, I watched the news, talked to some family on the phone and felt punched by the events most of all.

I made some calls to business friends in the New York City area to check on them and didn’t reach many but some were answering.  One friend, a jewelry manufacturer, holed up in his facility in lower Manhattan and stood guard over his business for days.  His wife witnessed a man get beaten in their Queens neighborhood for being nothing other than of Middle Eastern descent. 

In the evening, I started to get calls and emails from friends around the world asking if I was OK.   They knew me to be a frequent traveler and from their vantage point, it would be perfectly logical for me to be in New York or Boston or Washington, D.C. 

I sat on my back patio for a good part of the evening and just marveled at how quiet it was.  It was still like an early sunday morning.  No sound of cars, people or airplanes.   When my telephone rang, it sounded abnormally loud every time.

I was as shocked as anyone and probably a bit more upset than some given what I knew of the airline industry.  I deduced what had happened very quickly and never learned anything that truly contradicted my guess that hijackers had taken control of airplanes and most passengers had cooperated in the idea that doing so would get the airplane on the ground.  But the hijackers had broken the model and done the unthinkable. 

I was bitterly proud that those on UA 93 had learned what was going on and had fought back.  When I heard that, I knew that never again would passengers be passive in such circumstances.  I haven’t been proven wrong in 10 years either.

I’m genuinely sorry for those who suffered direct losses that day.  I’m also fairly bitter about where we are 10 years later.

It upsets me that we haven’t raised a bolder building in the World Trade Center’s place yet.  If it had been up to me, we would have finished that long ago. 

I am very disappointed at the losses of personal freedom in the last 10 years.  I’m extremely upset that people went along with it so passively and I’m very upset that Congress continues to cower in political fear rather than eliminate those losses.  I think the Patriot Act was one of the worst things ever done in terms of legislation.

I hate that our airline transportation security is still theater rather than real.  Consider that in 10 years, the TSA hasn’t once thwarted a terrorist threat.  But they have allowed numerous breaches in that time and under circumstances that leave me wondering if anyone is actually doing their job.

It infuriates me that the TSA is more of a problem for us all than a solution.  That the TSA is a source of theft and insult rather than a professional corps of security people doing their job well.  It angers me that the solution to security 10 years later is to invade their bodies with scanners or sexually asssault them with pat downs.  The United States should be a better place than that.

It’s been a horrific decade for the airline industry.  September 11 was the start and the heavy hits have kept coming ever since.  Consider that American Airlines has lost more than $1billion a year in the last 10 years.  Several major airlines have had to declare bankruptcy.  Many others had to merge or die. 

And every time they think they’ve got  a handle on things, another punch comes. 

There have been other disappointments.  The only truly new mainline airplane to be built and delivered in the last 10 years has been the Airbus A380.  In the 1960s, we saw tens of new ones designed and built.  What’s worse, while we’ll see 2 more in the next 10 years, that’s about it.   What happened to innovation in building new airliners?

It’s been a bad 10 years for the United States.  I would like to suggest that we consider just how much we’ve all taken and how we all are still standing today.  I would like to see the next 10 years in the United States to be a decade to rebuilding, growth and facing up to our problems and challenges. 

I would like to have some pride in my government.  It’s been too long now. 

I would like to see my fellow citizens be just a bit less selfish, a bit less political and a bit more focused on cooperating with each and achieving things.  It’s time to get back to achieving success and overcoming challenges presented to us.  It’s time to be leaders again rather than bitter isolationists.  It’s time to wake up and get back to competing. 

It is definitely time to find new leaders.  I want to see people who understand what it means to represent the whole rather than the special interest.  I want to see leaders who work hard, play hard and set sterling examples of looking forward to the future.  I want people who ask us to stretch rather than wait passively. 

Today should be a day to reflect not only on our losses but on how we need to get going with our lives and our country and do much, much better.

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Thoughts on Southwest

June 8, 2011 on 1:00 am | In Airline News, Airports | 2 Comments

I had to fly to Chicago again this past weekend and took Southwest once more.  That caused me to consider Southwest as an airline with respect to where it is and what is happening with it today. 

In many respects, Southwest remains my favorite airline.  I like how they move their planes.  I like their seats and I like the prices quite a bit, too.  They still largely have a friendly and motivated staff and they take their jobs seriously.  Their service is far more consistent than many other airlines and, as an airline, they’re pretty creative in how they get the job done.

I’m also a bit irritated with them and I’m really irritated with the cities of Dallas and Fort Worth. 

I’m irritated with Southwest because of the now 3 flight attendants who have tried to either A) move my briefcase from the bin above me to the back or B) tried to convince me to move it under the chair in front of me.  All because they are unwilling to say “no” to the new business travelers they have carrying their entire life with them.  I was traveling on business each time.  I had a lot of stuff with me in fact because of the work I was doing and I still managed to check my bag.  Ironically, I got into my ride’s car in Chicago and left before several of the business travelers managed to who were waiting for taxis. 

But don’t tell me that the overhead bin is reserved for large suitcases.  Poppycock and balderdash.  They aren’t, they never were and just because you find gate checking bags difficult doesn’t mean you get to move my briefcase to the back of the plane to make it more convenient for someone else to put their large suitcase up in a bin.

I’m also irritated at their gates.   Their gates in Chicago and Dallas are cramped, hot and uncomfortable.  Even with the new “business areas”, they are cramped, hot and uncomfortable.  So much so, that I realized I was getting tired from just jockeying for a seat in a gate area.  And you know what I noticed?  Many of the seats are being taken up by people putting their large bags in the seats.  There has to be a better way.

Southwest has announced that they won’t withdraw Airtran from DFW until November 21st and now Dallas and Fort Worth mayors are being crabby about that.  Well, I tend to agree that getting that done earlier is unlikely to be a very difficult thing to do and is unlikely to inconvenience many more additional passengers.  But it irritates me because this is, in part, who Southwest has become as an airline.  They’re becoming the company that doesn’t cope with its size very well.  It’s lethargic because it lacks the IT infrastructure to deal with its size.  They could be a lot more agile than they are.

I’m irritated with the City of Dallas because Love Field really is abysmal as an airport.  Yes, it’s being renovated and that means inconveniences but that does not mean that restrooms need to be dirty and stores and restaurants need not act entitled to every last dollar bill in my wallet.  The terminal is blazing hot already and nothing has really been done to accomodate passengers during this construction.

Frankly, this is a job that should have been done 10 years ago, not scheduled for completion sometime in 2014.

The way the use of Love Field airport is being dictated even post 2014 is silly.  I get that Fort Worth wants to be a Big City and they aren’t small, for sure.  But please quit acting like your whole world crashes if airlines use Love Field.  It was the preferred airport in the Metroplex back in 1959 and remains so today.  It’s a shame that Fort Worth couldn’t support a similar airport but they couldn’t do so in the last 50 years.  DFW serves them very well and it isn’t inconvenient to most of that city. 

If Fort Worth needs more airline access, how about we let them build an airport in south west Tarrant county?   The entire Dallas / Fort Worth Metroplex has over 6 million people.  We can support more than just DFW airport these days.

But the petty squabbling that goes on between these two cities over airports is just stupid in 2011.  And both Southwest and American Airlines could stand to get a bit more real over that subject as well.  Let’s not be naive:  the reason both those airlines continue to poke and prod the city governments over the issue is driven by their desire to continue to monopolize their respective airports in the area. 

Southwest could stand to become a better airline and I think they’re actually headed towards some serious trouble.  They’re innovating on the customer side but I don’t see them investing in their infrastructure quite the way a big airline should.  Holding on to perfectly good things is fine but you must reinvest in your systems from time to time to continue to grow and compete.  Let me point out that Southwest is using a reservations system it bought from Braniff originally titled “Cowboy” and developed in the late 1960′s.  Yes, it’s basic reservations infrastructure is 50 years old and never was all that good to begin with.

Why does this irritate me?  Because I think Southwest is good and it could be really great but for how slow it is moving these days.

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