Hey, it turns out that high fuel prices really hurt airlines' profits. In fact, especially if you think you can give away tickets and make it up on ancillary revenues, you really need to cut costs. At least that is the current state of affairs at Ryanair, who hopes to cut $621-Million in annual costs in various areas, including labor, due to extraordinary high fuel costs.
Yes, Ryanair also hopes to boost the top line through higher baggage and credit card fees. But we have to say, when the poster child of LCC's is talking about a need to tighten the belt, this is not going to be a good year for airlines. You can save yourself a call to Jamie Baker, Robert Mann, or Terry Trippler. You just read it in The FMV.
Thursday, March 27, 2008
Wednesday, March 26, 2008
Emirates: Thank you very little
We saw this fairly disturbing news last week. Apparently Emirates allowed the "first authorized mobile phone call made from a commercial flight" last Thursday. This follows the several million unauthorized wireless calls, texts, bbery messages, etc. made daily on US flights - - you know who you are.
This was no gimmick - Emirates plans to roll this "service" out on all flights. That's right - - now you can enjoy a trip around the globe while receiving continuous sidestream updates on some blowhard's all-important business deal, Aunt Polly's gout, and how much Pookums misses their Little Boo, and conversations that end with "No, I love you more - you hang up first..." The silver lining? Apparently only six of these goofs that don't recognize the value of a few hours unplugged can talk at one time.
A bit off our core topic, but inevitably carriers will charge for this service, or offer legitimate distribution services via inflight wireless devices, so we figured we'd keep the FMV audience up to date. In the meantime, note to self: remember not to fly Emirates. And also:
This was no gimmick - Emirates plans to roll this "service" out on all flights. That's right - - now you can enjoy a trip around the globe while receiving continuous sidestream updates on some blowhard's all-important business deal, Aunt Polly's gout, and how much Pookums misses their Little Boo, and conversations that end with "No, I love you more - you hang up first..." The silver lining? Apparently only six of these goofs that don't recognize the value of a few hours unplugged can talk at one time.
A bit off our core topic, but inevitably carriers will charge for this service, or offer legitimate distribution services via inflight wireless devices, so we figured we'd keep the FMV audience up to date. In the meantime, note to self: remember not to fly Emirates. And also:
From "Today’s Cartoon by Randy Glasbergen", displayed with special permission. For many more cartoons, please visit Randy's site @ http://www.glasbergen.com/. Thank you, Randy!
Thursday, March 20, 2008
Some Economy Seats are More Economy Than Others
Since FMV moved it’s headquarters to Chicago late last year – we find ourselves flying United a lot. You may think it’s because of their weird faux-cartoon ads that they plaster everywhere – but it’s really because of their “EconomyPlus” seating with extra legroom. After earlier hints, JetBlue has officially jumped on that bandwagon:
JetBlue will reconfigure its Airbus A320 fleet to offer seats with more legroom, and will charge more for those seats. JetBlue is calling the product Even More Legroom, which will offer 38 inches of pitch in the second to fifth rows plus emergency exit rows 10 and 11... The airline will charge $10 each way for short-haul flights (under 600 miles), $15 for medium-haul flights (601 to 1,500 miles) and $20 for long-haul flights (over 1,500 miles).
That’s actually great – but there is also another kicker:
The airline won't be selling Even More Legroom in the GDSs because of "technological limitations," JetBlue said. But the airline added that clients who book via a GDS can go to the Manage Your Flight link on JetBlue's Web site to purchase the extra legroom.
A few FMV points:
1) OK, we just assumed that JetBlue’s marketing department had a down day when they branded their new refundable fare product “Refundable Fares”. But seriously, “Even More Legroom”? Please try a little harder to imply that the old coach seats don't have crappy legroom. You know who will REALLY hate this name?? The call center agents who face this scenario happening 100 times a day:
JetBlue Agent: “Hello, You have reached JetBlue – how may I help you”
Customer: “Uhh, Hi – I bought a seat for my upcoming trip, and I know I get a roomy seat, but I’d now like to purchase EVEN MORE LEGROOM!! Ha Ha Ha”
2) This also has “Ancillary Revenue” written all over it and kind of goes against the Jetblue vein. Fine – you don’t have a “business class” – but you now have the beginnings of tiered system…
3) Finally – and most importantly - we love the fact that this purchase option is not available in the GDS. It’s the mythical “Fourth Cabin” limitation of GDSs; they cannot inventory control this type of stuff, and therefore can’t sell it. But FMV will bet you $10 (Even More Legroom for a short-haul flight) that the GDSs come out and blame the airline as not being “buyer focused” for doing this to them. It's classic GDS victim-hood at it's best (see Air Canada).
So while you won't catch us flying JetBlue just yet (simply not enough flights from ORD), we applaud them for providing meaningful product differentiation (i.e. not just a seatback TV and faux-hipster vibe). We also applaud mother nature, for dumping a (late) winter storm on Chicago today, giving us the perfect excuse to duck out early to watch the NCAA tournament. For those stuck on a cot at ORD - sorry, but these things happen for a reason.
JetBlue will reconfigure its Airbus A320 fleet to offer seats with more legroom, and will charge more for those seats. JetBlue is calling the product Even More Legroom, which will offer 38 inches of pitch in the second to fifth rows plus emergency exit rows 10 and 11... The airline will charge $10 each way for short-haul flights (under 600 miles), $15 for medium-haul flights (601 to 1,500 miles) and $20 for long-haul flights (over 1,500 miles).
That’s actually great – but there is also another kicker:
The airline won't be selling Even More Legroom in the GDSs because of "technological limitations," JetBlue said. But the airline added that clients who book via a GDS can go to the Manage Your Flight link on JetBlue's Web site to purchase the extra legroom.
A few FMV points:
1) OK, we just assumed that JetBlue’s marketing department had a down day when they branded their new refundable fare product “Refundable Fares”. But seriously, “Even More Legroom”? Please try a little harder to imply that the old coach seats don't have crappy legroom. You know who will REALLY hate this name?? The call center agents who face this scenario happening 100 times a day:
JetBlue Agent: “Hello, You have reached JetBlue – how may I help you”
Customer: “Uhh, Hi – I bought a seat for my upcoming trip, and I know I get a roomy seat, but I’d now like to purchase EVEN MORE LEGROOM!! Ha Ha Ha”
2) This also has “Ancillary Revenue” written all over it and kind of goes against the Jetblue vein. Fine – you don’t have a “business class” – but you now have the beginnings of tiered system…
3) Finally – and most importantly - we love the fact that this purchase option is not available in the GDS. It’s the mythical “Fourth Cabin” limitation of GDSs; they cannot inventory control this type of stuff, and therefore can’t sell it. But FMV will bet you $10 (Even More Legroom for a short-haul flight) that the GDSs come out and blame the airline as not being “buyer focused” for doing this to them. It's classic GDS victim-hood at it's best (see Air Canada).
So while you won't catch us flying JetBlue just yet (simply not enough flights from ORD), we applaud them for providing meaningful product differentiation (i.e. not just a seatback TV and faux-hipster vibe). We also applaud mother nature, for dumping a (late) winter storm on Chicago today, giving us the perfect excuse to duck out early to watch the NCAA tournament. For those stuck on a cot at ORD - sorry, but these things happen for a reason.
Ouch Redux: Northern Exposure Edition
What goes on here? Just last month we wrote about Ryanair shutting down their reservations for 3 days to upgrade their systems.
Now comes word that Alaska Airlines will shut down access to their mileage plan systems in April for a week! No redemption, no mile-based upgrades, no signing up for the program, etc.
We suppose the business impact is relatively small. They gave loyal customers a month notice, and most passengers will be able to figure it out and work around the outage. But you can rest assured that some know-it-all customers will be pretty hacked off to find out that they can't redeem their miles right-then-and-there for that all-important dream trip to Anchorage.
It just seems hard to believe that system migrations like these can't happen a little quicker. A few days we get - but a week?? A $3.5-Billion bank like Bear Stearns can teeter on the brink of bankruptcy, get bailed out by the Fed, nearly fail again, then get liquidated by a quasi-partership of the government and an opportunistic white knight in just two days -- and an airline can't migrate a few customer profiles in less than a week? What kind of a world do we live in?
Now comes word that Alaska Airlines will shut down access to their mileage plan systems in April for a week! No redemption, no mile-based upgrades, no signing up for the program, etc.
We suppose the business impact is relatively small. They gave loyal customers a month notice, and most passengers will be able to figure it out and work around the outage. But you can rest assured that some know-it-all customers will be pretty hacked off to find out that they can't redeem their miles right-then-and-there for that all-important dream trip to Anchorage.
It just seems hard to believe that system migrations like these can't happen a little quicker. A few days we get - but a week?? A $3.5-Billion bank like Bear Stearns can teeter on the brink of bankruptcy, get bailed out by the Fed, nearly fail again, then get liquidated by a quasi-partership of the government and an opportunistic white knight in just two days -- and an airline can't migrate a few customer profiles in less than a week? What kind of a world do we live in?
Monday, March 17, 2008
Booking Bonus Days AAre Gone
Well it is official. Mileage bonuses for booking direct on a cAArrier website are just not happening anymore. If any carrier is still doing it, it's probably due to a technical error or a staffing restriction (i.e., the guy that was supposed to pull the promo got laid off). Cue the Little River Band classic, "Reminiscing".
The latest sorrowful news came to us courtesy of the American Airlines DealFinder tool. No more booking bonus at AA.com after AApril.
Sigh. Now how are we going to earn our reward tickets to Tulsa? Hmmm. What to do? Note to self: Pitch ncAA "tournament pool for miles" idea to AA.
The latest sorrowful news came to us courtesy of the American Airlines DealFinder tool. No more booking bonus at AA.com after AApril.
Sigh. Now how are we going to earn our reward tickets to Tulsa? Hmmm. What to do? Note to self: Pitch ncAA "tournament pool for miles" idea to AA.
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