Executive Travel SkyGuide

EXECUTIVE TRAVEL SKYGUIDE E-ALERT 01/10/05

Welcome to EXECUTIVE TRAVEL SKYGUIDE E-ALERT for the week of January 10, the weekly e-mail of essential business travel news!

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Other airlines cut prices to match new Delta structure
US Airways, UAL make some progress on labor pacts
Next stop for Southwest Airlines: Pittsburgh
United's Ted affiliate will start flying out of Chicago Midway
Independence Air slashes schedule in bid to cut costs
Alaska starts food sales on Mexico routes
Cingular opens up Wi-Fi connections at Raleigh-Durham Airport
Phoenix Sky Harbor, RDU get 'new' airport hotels

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AIRLINES

Other airlines cut prices to match new Delta structure
Major U.S. airlines last week were reluctantly matching new, lower fares instituted by Delta as part of a major overhaul and simplification of its domestic pricing structure. American Airlines seemed to go the farthest in matching Delta's new structure, while other legacy carriers tended to restrict their response to routes where they directly compete with Delta. Overall, the changes could represent the biggest bonanza for business travelers since American slashed prices in the early 1990s, with some full fares being reduced up to 50 percent - although some observers worried the ultimate effect might be reduced industry revenues so much that some airlines could fail.

Delta's new pricing regime, which it calls SimpliFares, are a nationwide extension of the pricing it introduced in Cincinnati last August. The major changes: Domestic (i.e. in the 48 contiguous states) walk-up fares are capped at $499 one-way in economy, $599 in first class; discount fares are still non-refundable and require roundtrip purchase three, seven, 14 or 21 days in advance, but they now require only a one-night stay, not a Saturday-night stay, and the ticketing change fee dropped from $100 to $50. Delta also matched other carriers in initiating fees of $5 for buying tickets over the phone and $10 for purchases at Delta ticketing locations, including airport counters.

While the new fare structure will certainly make short-notice travel less expensive for business travelers, Delta's fare caps are not as low as those of Southwest or AirTran. In fact, Atlanta-based AirTran said it did not have to reduce any of its fares to match the new Delta structure.

US Airways, UAL make some progress on labor pacts
Both US Airways and United made some progress in recent days on new labor agreements that should give them significant cost savings as they struggle to emerge from bankruptcy. At US Airways, flight attendants voted to approve a new pact that will save the company $94 million a year. The approval also seems to remove the threat of a job action by the flight attendants that could have disrupted the airline's operations.

United Airlines over the weekend said it has reached tentative new labor agreements with both its machinists union and its flight attendants, although both are subject to approval by a vote of the rank-and-file membership. The flight attendants' deal did not cover the touchy area of pensions, which has been put off to later negotiations. However, United was dealt a setback in bankruptcy court when the judge tossed out a new contract that the company had hammered out with its pilots union, and which union members had just voted to approve. The contract would have done away with the pilots' defined benefit pension plan, but the judge objected to a clause that would have tied that provision to United's success in eliminating pensions for its other unions.

Next stop for Southwest Airlines: Pittsburgh
Remember how industry prognosticators started warning of doom for US Airways when Southwest Airlines moved into its Philadelphia hub last spring? Well, Southwest last week announced its newest strategic move, and it will be into a city where bankrupt US Airways is still the dominant carrier: Pittsburgh. As if US Airways didn't have enough trouble trying to wring even more wage reductions from its unions, it will now face even more low-fare competition in a market where its presence has been seriously shrinking. US Airways reduced operations at PIT by almost 30 percent in the past year, and eliminated non-stop service to some 20 smaller cities, as its shrinks its hub there to focus-city status instead. Southwest has not yet announced which destinations it will serve from Pittsburgh, but said it expects to start operations at PIT in May, and to reveal specific operating plans in April.

United's Ted affiliate will start flying out of Chicago Midway
United Airlines' low-cost affiliate, Ted, will start flying out of Chicago's close-in Midway Airport on April 3, operating three non-stop flights a day to United's Denver hub and two a day to its Washington Dulles hub. Ted already flies out of United's crosstown hub at Chicago O'Hare, but Midway is more convenient for those who live in the southern half of the giant metropolitan Chicago market, and it is already known as a base for low-cost carriers operating at Chicago - including Southwest, which is taking over many of the operations of bankrupt ATA Airlines at Midway Airport this year.

Independence Air slashes schedule in bid to cut costs
Financially-troubled Independence Air is planning to sharply reduce its schedules at the end of January in order to wring overcapacity out of its system, which for December reported a load factor of just 54 percent - substantially below the industry average. The Washington Dulles-based low fare carrier said it will eliminate some 150 of its 500 daily departures, most of which are operated with regional jets. The airline will drop its new non-hub routes to Florida from Charleston, S.C.; Huntsville, Ala.; and Greenville-Spartanburg, S.C., and will cut back frequencies on many Dulles routes. For example, its Washington-Chicago O'Hare schedule will be reduced to six flights a day from the current 10, while Dulles-Pittsburgh service will be reduced from 10 flights a day to seven. Independence Air parent Flyi Inc. is reportedly negotiating with United to resume service as a United Express partner at Dulles.

Alaska starts food sales on Mexico routes
The latest carrier to begin selling food to passengers is Alaska Airlines. On January 9, the company started offering meals for purchase on its flights from Seattle and California to Los Cabos, Mazatlan, Puerto Vallarta, Manzanillo, Loreto and Ixtapa/Zihuatanejo. The meals cost $5 and are provided by LSG Sky Chefs.

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AIRPORTS

Cingular opens up Wi-Fi connections at Raleigh-Durham Airport
At Raleigh-Durham International, Cingular Wireless has started offering high-speed wireless Internet service in terminal concourses and gate areas. For those who aren't regular Cingular Wi-Fi subscribers, the company offers various limited-use options, from $9.99 for 24-hour availability from a single connection to $49.99 for 10 24-hour sessions from a single location. Details are available at www.attwireless.com/wifi. Cingular also provides Wi-Fi airport connections at Denver, San Francisco, Philadelphia, Kansas City, Salt Lake City and Louisville, as well as at Amtrak stations in the Northeast Corridor.

HOTELS

Phoenix Sky Harbor, RDU get 'new' airport hotels
Holiday Inn properties at Phoenix Sky Harbor Airport and Raleigh-Durham Airport have new brands following substantial upgrades and renovations. The former Holiday Inn near PHX at 4300 East Washington is now a Crowne Plaza, and thus still a member of the InterContinental Hotels Group. It now offers high-speed Internet access and voicemail in each room, as well as same-day laundry and valet service, a 24-hour business center and express checkout. In Research Triangle Park, N.C., meanwhile, the former Holiday Inn has reopened as the Hilton Raleigh-Durham Airport after a substantial overhaul and upgrades to guest rooms. There's high-speed wireless Internet access throughout the hotel, as well as frequent free shuttles to the airport and to offices within a five-mile radius.

AIR ROUTES

BOSTON (BOS). JetBlue Airways has added a second daily roundtrip on its Boston-Ft. Myers, Fla., route, as well as a third daily Boston-Tampa non-stop. On January 10, it will lay on a fourth daily Boston-Ft. Lauderdale flight, and a fifth daily Boston-Orlando trip. JetBlue also announced last week that it plans to begin new non-stop routes out of Boston on May 3 to San Jose and Las Vegas, and to increase frequencies between BOS-Oakland and BOS-Long Beach.

CHICAGO MIDWAY (MDW). AirTran Airways on January 11 will begin operating seven new non-stop flights each day between Midway and Florida, including two to Ft. Myers, two to Orlando, and one each to Ft. Lauderdale, Sarasota/Bradenton and Tampa. On January 16, Southwest Airlines will add a fifth daily MDW-Orlando flight, a fourth daily MDW-Ft. Lauderdale frequency, and a third daily MDW-Manchester, N.H. non-stop.

DETROIT (DTW). On January 12, Northwest Airlink/Pinnacle Airlines begins twice-daily regional jet non-stops between Detroit and Wichita, Kans.

FT. LAUDERDALE (FLL). Low-fare Spirit Airlines on January 10 will begin daily non-stop service between Ft. Lauderdale and Nassau, Bahamas.

THIS WEEK'S DEALS AND SPECIALS FOR BUSINESS TRAVELERS

Were you thinking of signing up for a Blackberry service agreement this year? For small business customers who buy a minimum one-year agreement, Avis will provide free Blackberry wireless devices in exchange for car rentals now through March 31. Avis will give out one Blackberry 6710 (a $99 value) for each completed rental, up to a total of five, as well as an $85 mail-in rebate toward the required activation and first-year service charges. You'll have to provide a rental agreement number from the rental receipt to have the Blackberry shipped to you. For details, visit www.avis.com/blackberry.

Holders of the Classic, Gold or Platunum Delta SkyMiles Card from American Express can earn a SkyMiles bonus of 20.05 percent (signifying the year 2005) on all purchases from January 1 through 31 if they sign up at www.americanexpress.com/deltabonus, or by calling 800-227-7081. And when they use the card from February 15-March 15 for Delta travel purchases of $265 or more, they can earn triple miles; for that promotion, enroll at www.americanexpress.com/deltatriple, or by calling 800-615-0403.

For links to other websites where you can search for bargains, click here: www.executivetravelonline.com/reference/deals.html

By Jim Glab

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