Lower Euro, Stronger Dollar Makes Europe More Affordable

Going into the low travel season of January to mid-March, U.S. travelers will benefit from a favorable exchange rates between the Euro and the dollar as well as seasonal lower pricing on air travel, hotel and other travel related services. It is a relatively good value compared to prior years when the Euro hovered between $1.33 to $1.60. With talks of austerity and recession, travel providers are getting more realistic about pricing, and deals are abound during the low season. Many fares are so low that the taxes and fees amount to triple the base fare. Premiere Travel will be featuring many new booking tools in 2012 designed to take advantage of special pricing opportunities and packages. www.premieretravel.com

On-time Arrivals "Improving"

You see the headlines in how well airlines are doing in their on-time arrivals, which happens to be one of the performance measurements by the U.S. Department of Transportation (USDOT). What many passengers don't know is that airlines build a generous margin of safety to insure a high probability of on-time arrivals. For example, a flight from Reagan National Airport to New York LaGuardia takes about 38-45 minutes of wheels-up to wheels-down, but yet the schedule shows 1 hour and 21 minutes for that flight. In this case, the airline built in a margin of safety of 41 minutes for a 40-minute flight. So even if the flight is 30 minutes late in take-off, the airline can boast an "on-time" arrival as the plane is taxiing to the gate with 10 minutes to spare. Sometimes things don't work out so well. Planes arriving well before their "scheduled" arrival may find themselves stopping short of the gate due to the fact that a departing plane has not left the gate that the arriving plane is supposed to occupy. Weather delays and congestion may also mean that a plane may circle around and queue for landing at busy airports such as Chicago O'Hare and New York LaGuardia. Airlines do post the "probability" factor, usually on a scale of 1-10 for the "timeliness" of their flights. The higher the number, the more likely the flight will be on time. www.premieretravel.com

Advance Seat Assignments Will Be More Difficult in 2012

In continuing the trend of commoditizing every aspect of the flying experience, desirable seats will be harder to score in 2012 and will cost more.

Airlines are holding back on a larger inventory of seats for their premium mileage members and making travelers pay for exit row, extra legroom, and even standard aisle seats towards the front of the plane.

Travelers may be disappointed when they pull up the seat map only to find middle or undesirable seats even when they are booking far in advance.

Premiere Travel implements an automated program that works around the clock in search of better seating for our travelers if and when they become available.

www.premieretravel.com

Best Airline Mileage Credit Cards

Many airlines are aggressively marketing their versions of major credit card programs that offer a variety of benefits to the traveler.

Before you sign on the dotted line, please consider the following in determining the best program for you:

1) Will you likely fly that airline a few times in the upcoming year?
2) What are the benefits promised and are they relevant to your needs?

Adding 50,000 bonus miles is a big plus that may enrich your mileage balance allowing you to take advantage of free flights and upgrades. 50,000 miles is the usual requirement for two domestic tickets, so that's definitely a good start. Some airlines will double your miles when you use the card for certain purchases and allow you and companions free checked baggage as well as Club Passes and priority boarding.

United Airlines Mileage Plus Explorer and Delta SkyMiles cards are the very best right now. The first year membership fee is waived ($95), and you are likely to recoup the cost of the membership the second year even if you use your card for one flight.

www.premieretravel.com

The New Normal: Sub-Par Airline Service

Flight Attendants moving up and down the aisles with big open trash bags calling out "trash...trash..." is an example of what today's travelers hear on domestic flights.

Surly service at the gate and on board have become quite common particularly on domestic flights.

The past was a glorious time to fly...china settings, real silverware, hot meals on board, full carts of free beverage, and basics like magazines, pillows and blankets were a minimum standard.

The first class cabin, a true past luxury on domestic flights has become a much hyped up offering full of "upgraded" passengers with high status. Airlines have created a sport in scoring an upgrade as passengers compete furiously for limited number of seats. Cold sandwiches and drinks in plastic cups await the lucky ones.

There is no avoiding to this new normal. Airlines through their alliances, joint ventures and code shares have carved out the map and created a false sense of competition that exists in only a handful of markets where the legacies compete with the upstarts.

The new normal is here to stay, at least for the forseeable future.

www.premieretravel.com

Delta Makes a Strong Pitch to Latin America

Delta Airline' tactical move to buy a small percentage of Brazilian carrier Gol revealed the strategy of Delta to gain a stronger presence in Latin America.

Gol is the second largest Brazilian carrier with a strong domestic network and newer fleet of aircraft that is growing at a double-digit pace. Delta's move was intended to keep Gol away from joining another alliance, namely, American's One World. It allows both carriers to market and code-share each other's flights.

Overall, Delta's move is very positive for travelers as the Atlanta gateway will be more relevant to a wider network of South American gateways.


www.premieretravel.com

Why Baggage Fee Disclosure Is So Complicated

Airlines and associations representing their interests are urging the U.S. Transportation Department (DOT) to postpone the January 24, 2012 implementation requirement of baggage fee disclosure.

After already agreeing twice to delay implementation, airlines now need at least an additional year.

In an ominous note that has a tinge of a threat the International Air Transport Association (IATA), Air Transport Association, Regional Airline Association and Air Carrier Association of America in their joint filing said:

“If an extension is not granted, carriers would be forced to adopt error-prone makeshift procedures that would substantially delay passenger check-in, create long lines at airports [and] substantially reduce the availability of automated self-service check-in, including the fast-growing popular remote check-in systems.... Proceeding with the Jan. 24 implementation date also will increase the risk of delayed or lost bags, the associations say, and increase the likelihood that carriers will create “confusion and disenchantment” by applying the wrong carrier’s baggage fees."

So what's the point of deadlines? January 24, 2012 is the date that the airlines themselves had requested after two extensions had already been granted.

www.premieretravel.com

Rude and Aggressive Flight Attendants

Alec Baldwin was passing time sitting in his seat on a flight at a gate and not going anywhere, playing "Words with friends", when apparently a flight attendant "reamed" him to put away his smart phone. His swift lack of cooperation necessitated removing him from the flight.

Some flight attendants on domestic flights have gotten into the "rhythm" of doing their jobs methodically and harshly. They are overworked, underpaid and unhappy, and they have no hesitation in letting you know it.

If you don't turn off your smart phone, bring your seat to upright position or follow their directions, their voices will remind you of your fourth grade teacher chastising you.

Foreign carriers compete harder for your business, and their flight attendants who are better trained, treated and paid show the travelers the respect, service and smiles that have become so rare in the cattle car conditions on domestic routes.

www.premieretravel.com

The "Sweet Spot"...When Is the Best Time To Book Air Travel

The question is repeatedly asked: What's the "sweet spot" to book air travel to get the best fares, availability, most desirable seats, etc...

The short answer is: It depends!

Not being big on answering question with questions, we will lay it out:

Factors that are considered to answer:

1) What is the origin and destination?
2) What is the season (high/low or shoulder?
3) Is it a high demand resort or business destination?
4) International or domestic?
5) Is it a competitive route?
6) Direct or Connections flight(s)?

The common misconception with travelers is that the earlier you book, the cheaper the fare...not true. For example, booking 10 months in advance may not get you the lowest fare as airlines believe that they have a lot of time to sell the seat.

For international travel 3 weeks-3 months would normally yield a lower fare.
Domestic tickets are more subjective to a variety of airline algorithms that vary due to all above factors...

www.premieretravel.com

American Airlines Files For Bankruptcy

AMR, parent company of American Airlines, filed for bankruptcy protection Tuesday morning in New York. American was the only legacy carrier not to have filed bankruptcy in the last couple of decades.

The heavy load debt, pension obligations, unfavorable leases, and labor contracts have taken their toll on the thrid largest carrier in the U.S.

Travelers should not see any changes however. American will continue to operate, and all mileage benefits will continue to accrue and will be honored.

American's necessary move will mean a leaner and smaller carrier in 2012.

www.premieretravel.com

Avoid London Heathrow on November 30

Airlines have cancelled or reduced flights into and out of London Heathrow Airport due to a nationwide strike that airport employees will be participating in.

Immigration employees are expected to take part and delays of up to 12 hours to get in or out of Heathrow.

In the latest dispute, workers oppose government demands that they work longer before receiving a pension, contribute more money each month and accept a pension calculated using their average career salary, rather than their final salary.

www.premieretravel.com

Should Airlines Charge Fees For Carry-Ons?

Travelers by now know that airlines have found a cash cow, charging fees for checked-in luggage. While policies vary, airlines charge about $25 for the first checked-in bag, with exceptions such as Southwest.

Passengers not only find the fee unfair, but also inconvenient. The wait for checking in bags and receiving them at destination makes it a double whammy. Savvy travelers try to cram as much as they can into carry-ons, which are free (except at Spirit).

The unintended consequence of baggage fees has created many problems:
* Longer security lines due to larger carry-ons and more
bulkier items passing through the security gauntlets.

* Longer boarding process where passengers occupy aisles
longer hunting and jockeying for overhead bins.

* Mad scramble to board first just to get better chance to
stow luggage overhead.

The solution may be simple. While this may sound counter intuitive, airlines should go back to check bags free and charge for luggage carry-ons. Boarding process will be a snap, departures/arrivals are more timely, and security lines will move faster.

www.premieretravel.com

Link Your United Mileage Plus With Continental One Pass

United Airlines has released the details of the new 2012 MileagePlus Program.
Those who qualify for "Premier" status in the 2012 program will receive membership information, including new cards, late in the first quarter of 2012.

Complete information can be found at: mileageplusmergerupdates.com or onepassmergerupdates.com

To link your accounts, go to united.com/linkmyaccounts

www.premieretravel.com

Expedited Screenings: Keep Your Shoes and Hat On!

A pilot test program by the TSA has been successful, and many major airports will have that option for travelers that pass the "trusted traveler" criteria.

It is expected that this program will be introduced in key major airports in the first quarter of 2012.

www.premieretravel.com

When Comparing Fares, Look At The Fine Print

There are hundreds, perhaps thousands of fare search engines and airline websites that purportedly gives the searcher the "lowest fare". Savvy travelers know to look beyond the headline fare and tally up all obvious and not so obvious add-ons to come to the final price.

Many website of airlines and search engines advertise "teaser fare" such as Washington-London at $199*.....The asterisk is where things start getting interesting. In this case, the asterisk means, limited seating, mid-week departure, non-refundable, non-changeable, minimum and maximum stay, excluding taxes, fees, surcharges and ancillary fees. Do expect that once you add all these, the price will exceed $800. False advertising? May be...

Even business travelers now are raising eyebrows about certain surprise fees that they encounter. For example, after shelling almost $10,000 for a British Airways business class seat, passengers are surprised by a $120 fee for a seat assignment, each way, for an additional $240 on a round-trip fare.

At Premiere Travel, we streamline the process for our clients through an honest Fare Compare and inform them of the final pricing without all the gimmicks.

www.premieretravel.com

Travelers Are The Most Taxed People on Earth

Travelers don't vote in their destinations. Politicians and providers therefore can pick on travelers for ever burgeoning number of taxes and user fees that seem to see no end.

A case in point is a round-trip ticket to London from Washington...Here's the fare breakdown exactly as you will see it on the ticket:
02DEC DEPARTURE DATE-----LAST DAY TO PURCHASE 02NOV/2359
BASE FARE TAXES TOTAL
1- USD240.00 564.10XT USD804.10ADT
XT 362.00YQ 32.60US 5.50YC 7.00XY
5.00XA 2.50AY 96.00GB 49.00UB
4.50XF
240.00 564.10 804.10TTL
ADT-01 LLWNC13S
WAS UA LON120.00LLWNC13S UA WAS120.00LLWNC13S NUC240.00
END ROE1.00 XFIAD4.5
NONREF/0VALUAFTDPT/CHGFEE

You will see that the BASE FARE is $240.00 and the final price of the ticket (even without agency fees) to be $804.10.
In this case the taxes and user fees amount to a 235% of the value of the ticket.

For a Car rental example, we have selected a typical weekend rental:
Rental Time Charge $41.38
APT CONC RECOV FEE (11.11%)$4.72
Customer Facility Charge ($3.50 per day) $7.00
Energy Recovery Fee ($0.55 per day) $1.10
STATE TAX (9%) $5.44
VEHICLE LICENSE FEE ($1.00 per day)$2.00
Vehicle Rental Tax (10%) $4.25
Total Estimated Mandatory Charges (USD)$65.89

Relatively speaking, a car rental taxes and fees are considered bargain at a tax/fees percentage of 59.2% of the overall cost.

We will spare you the nauseating hotel bill which is infested with a creative array of all types of taxes and fees imaginable.

Chicago has recently adopted an increase in their already high hotel taxes, and the infuriating part of it is the explanation: "To keep pace with New York" (sic)

www.premieretravel.com

Airlines Circling Around Credit Card Fees

Just as you thought airlines have run out of things to impose fees on, some airlines are quietly testing and implementing "targeted" fees on credit card charges.

For example, Lufthansa has started charging a credit card "surcharge fee" on tickets sold in some European cities this past summer. The credit card fee is tucked away among the dizzying array of taxes, fees, security and fuel surcharges. Tickets fare ladders and fare calculations are now so crowded with these fees and taxes to the point that the traveler, their corporation are quite confused.

Now the word is that Lufthansa will start collecting those credit card fees from sales generated anywhere, including the U.S. effective November 2, 2011.

The credit card form of payment has become such an important staple in paying for airline tickets, cruises and other travel services. This should be the opening salvo, which other airlines will surely be eagerly observing, and then likely matching.

www.premieretravel.com

Best Uses of Your Frequent Flyer Miles

Up to 30% of frequent flyer miles expire unused every year. Passenger toil hard and many purchase habits are now structured around mileage awards and credits.

Somehow however, after all the good planning, miles do expire and go to the " Mileage Black hole".

Here are the steps to take to preserve your miles and put them into good use:

1) Keep track of your miles and their expiration dates.
2) Use wisely! A 25,000 mile redemption for a transatlantic flight upgrade to business class is an excellent bang for the miles. Spending 50,000 on a $200 trip is not.
3) Look for saver deals. Airlines may discount redemption to certain routes to as few as 15,000.
4) Look for Code share partners to redeem on and claim mileage on.
5) Use mileage for hotel stays, car rental, cruises and other travel related services.
6) Redeem miles for friends and family
7) Know the rules: Airlines count on members not to "read the fine print". The more you know, the better.
8) There are many frequent flyer websites with great ideas and postings about how successful "redeemers" do it.

www.premieretravel.com

Capacity Cuts Creating New Opportunities for Discount Carriers

Legacy airlines have announced further capacity cuts to keep fares high and airplanes full. This strategy which has worked so far, might backfire in 2012 if the economy improves.

Discount carriers like Southwest, Spirit, JetBlue and Frontier are expnading routes and beefing flights while the legacy carriers are retreating.

Discount carriers enjoy a cost advantage over legacy carriers in many categories, including newer more efficient planes, non-unionized workforce and lower debt. It all boils down to cost per passenger per mile.

www.premieretravel.com

Our New Enhanced "PREMIERE" Hotel Program

We have added more value to our "Premiere Hotel" program . Many hotels within our program offer benefits such as:

Early Check-in/Late Check-out
automatic Upgrades
Block Space Availability
Free High Speed Internet
Breakfast Included
Welcome Amenities

These "Premiere Perks" vary by hotels and cities, so ask your travel advisor for hotel recommendations that offer preferred corporate discount rates with benefits.

Premiere Travel clients always receive great value.

www.premieretravel.com

"Special" Frequent Flyer Status Not So Special Anymore

Frequent business flyers who have achieved high "Gold", "Platinum", "Premier" and other "special" designations are beginning to see a noticeable dilution in the benefits they receive from their airlines.

Upgrades are much more difficult to score, Club lounges are ever more crowded with fewer amenities, award redemptions for desired flights are almost non-existent or will cost a fortune of miles.

Reasons for all this are simple. Airlines are now viewing those programs as profit centers and not rewards for loyalty that most flyers think they are. Flyers are also competing with non-flyers as you can earn frequent flyer miles on every purchase through credit and debit cards. These non-flyers are competing for scarce awards and seats. Airlines mergers, code shares, alliances and joint ventures add even more mileage credits that are bound to be redeemed.

In the meantime, airlines are cutting capacity, and reducing the number of premium seats to add more luxuries like sleeper business cabins. Seats dedicated for mileage awards are also getting very difficult to find particularly to sunny destinations.

On a recent flight, an airline called priority boarding for their top mileage earners, and no less than 20 flyers lined up to board. We are likely to reach a tipping point where travelers will start questioning the value of some of those benefits. Unless you are in the top tier, you are likely to see a continuous dilution of these benefits.

www.premieretravel.com

2011 Flight Cancellations-A New Record

Domestic airlines are on pace to record the worst year of flight cancellations since 2001.

By the end of the third quarter of 2011, more than 104,000 flights have been scrubbed. This represents an almost 2.5% of all flights scheduled.

Reasons vary. Beside the normal menu of weather related situations which have been eventful this year, and "mechanicals" are new tarmac delay rules that prohibit airlines from delays over 3 hours on the tarmac. Airlines opt to cancel flights than risk huge penalties amounting to thousands per passenger.

Booking flights online is simple enough and straight-forward for point to point itineraries. Relying on a reputable travel management company to be there for you when you encounter complications is a must for business and mission critical clients.

www.premieretravel.com

Premiere Travel Value Added Services

Airlines continue to "tweak" their frequent flyer programs, deleteing benefits, merging programs, increasing requirements, adding blackouts, increasing fees and co-pays, sprinkling many "ifs and buts" and moving targets for upgrades.

It takes knowledge and understanding of what is offered. Many of our clients have expressed interest in having Premiere Travel navigate these complexities on their behalf.

We are conducting a fee based pilot program for a limited time to assist our clients in claiming mileage awards, upgrades and maximizing the usage of their idle miles.
For details, please contact us at support@premieretravel.com

www.premieretravel.com

The Dream is Finally a Reality- Boeing Delivers First Dreamliner

After numerous delays and cost overruns, a ceremony on Monday will end up in the delivery of the first Drealiner 787 jet to All Nippon Airways.

www.premieretravel.com

The New United/Continental MileagePlus Program

United Continental Holdings Introduces 2012 MileagePlus Loyalty Program

United Continental today announced the details of its MileagePlus loyalty program for 2012, including new benefits and services for United's and Continental's most-frequent flyers, more options for members to redeem their miles and additional recognition for customers who purchase tickets in premium cabins or at premium economy fare classes.


"With MileagePlus, we are building the world's most-rewarding loyalty program and reaching another important milestone in the merger of United and Continental," said Jeff Foland, United executive vice president and president of Mileage Plus Holdings, LLC. "We will provide a wide range of benefits to our most-loyal and most-valuable members, while offering new redemption opportunities for all of our members."

MileagePlus Premier Levels and Benefits

In 2012, MileagePlus will offer four levels of Premier member status:


•Premier Silver: 25,000 Premier qualifying miles (PQM) or 30 Premier qualifying segments (PQS)
•Premier Gold: 50,000 PQM or 60 PQS
•Premier Platinum: 75,000 PQM or 90 PQS
•Premier 1K: 100,000 PQM or 120 PQS

United will continue to offer Global Services recognition to select members by invitation.

Premier benefits include:


•Upgrades: United will offer an expansive suite of upgrade products, including Global Premier Upgrades, Regional Premier Upgrades and Complimentary Premier Upgrades. United is expanding Complimentary Premier Upgrades to include eligible intra-Asia flights in addition to most flights within North America. Premier members traveling on certain full-fare economy-class tickets will also be eligible for an instant upgrade when available at the time of ticketing.
•Premier Access, checked-baggage allowance and Economy Plus® seating: Premier members will have access to Premier Access airport services, a complimentary standard checked-baggage allowance and extra-legroom Economy Plus seating, among other benefits. Premier Silver members and Star Alliance Silver members will be able to check one bag weighing up to 50 pounds with no fee, and Premier Silver customers will be able to confirm Economy Plus seating at time of check-in. Premier members at all other status levels will be able to check three bags weighing up to 70 pounds with no fee, and will be able to confirm Economy Plus seating, when available, at the time of ticketing.
•Premier bonus award miles: United will offer Premier members bonus miles of up to 100 percent on paid tickets.
•Flexible award redemption: Premier-level frequent flyers may continue to book United Standard Awards, even when redeeming miles for the last available seat on the flight, a benefit United is reserving for Premiers and customers who have the United MileagePlus Explorer Card or an eligible Chase-issued OnePass credit card.
•Additional credit card benefits: Beginning in 2012, Premier members who have the United MileagePlus Explorer Card or an eligible Chase-issued OnePass credit card will also qualify for Complimentary Premier Upgrades on eligible economy-class reward tickets.

Additional Benefits for Premium Cabin and Premium Economy-Fare Customers

United is introducing greater rewards to customers who purchase tickets in premium cabins or at premium economy fare classes. Travelers will earn up to 250 percent of the actual miles flown as award miles when they book first-class tickets, up to 175 percent for business-class tickets and 125 percent for full-fare economy-class tickets.

New Lifetime Benefits Program

United is launching a new Million Miler program with benefits drawn from the existing MileagePlus and OnePass programs, including the very popular spousal benefit. Starting in 2012, United will determine each member's lifetime earnings based on the member's elite qualification miles earned in MileagePlus and OnePass since joining the programs, and will pool miles for members with accounts in both programs. After this one-time adjustment, United will determine future lifetime earnings based on actual flight miles.

Customers who earn one million miles after the one-time adjustment will earn lifetime Premier Gold status for themselves and a spouse or significant other. Customers who earn two million miles will attain Premier Platinum status, those who earn three million miles will attain Premier 1K status, and customers who earn four million miles will attain Global Services status.

New MileagePlus Auctions Site

United will launch MileagePlus Auctions in January, enabling customers to use miles to bid on sports tickets, cultural events and once-in-a-lifetime experiences. United will provide more details later this year.

MileagePlus Auto-Enrollment in the First Quarter of 2012

In June, United announced the OnePass program will end on Dec. 31, 2011. In the first quarter of 2012, United will automatically enroll OnePass members in MileagePlus and deposit into those MileagePlus accounts award miles equal to their OnePass award miles balance.

www.premieretravel.com

Ready Or Not, Here They Come: $400+ Baggage Fees

Some airlines have started charging extra fees on second or third bags checked in for international flights. A 70-pound extra bag in coach will likely set the passenger back by about $400 or more depending on weight.

Airlines claim this will basically cover their costs. In other words, those airlines have been taking losses all these years covering the costs of extra luggage on these long haul international flights and they are just about ready to close that gap.

www.premieretravel.com

The Law of Unintended Consequences-Flight Cancellations

When the U.S. Department of Transportation implemented new rules for tarmac delays, airlines reacted by increasing the likelihood and probability of cancelling flights than risking huge penalties for delays over 3 hours.

The Government Accountability Office (GAO) put the probabilities of flight cancellations at 24% higher due to the new rules in effect that were intended to protect travelers from long delays.

Given the state of airspace restrictions, congestion, flight controls, bad weather and other factors, it has become increasingly likely that flights may sit in delay modes then cancelled altogether.

With too few seats available, the margin for error is too small to accommodate passengers on other flights as airlines continue to pare down available seats.

www.premieretravel.com

2012: A Shrinking Capacity

Many airlines have announced that they intend to make yet additional cuts in capacity in 2012 on top of the reductions already made in 2011.

Delta Airlines which has cut overall capacity by about 2% in 2011 intends to lob an additional 2-3% in 2012. Most of the reductions will be on domestic routes and will eliminate flights to/from smaller unprofitable routes that airlines used to receive subsidies for.

Travel in the Middle East and Asia are expected to grow modestly as wealthier airlines will continue to upgrade their fleets and services to meet growing demand in the Asia Pacific and emerging market regions.

www.premieretravel.com

Confusion Air: Multiple Airlines Codesharing One Flight

When the concept of "codesharing" came about in 1989, the idea was simple: two airlines would partner together to sell seats on a flight, whereby the "partners" are responsible for their passengers.

Nothing is simple anymore. The idea evolved into alliances and joint ventures, and a single flight operated by one airline could actually be sold by several airlines, each showing its own airline code and flight number.

Thousands of passengers every day go to the wrong terminal or attempt to check in at "their" airline, only to find out that the operating carrier is a different airline altogether, with different terminal, colors, crew, boarding and baggage policies etc...

To add to the confusion, frequent flyer mileage may be higher, lower or the same depending on the arrangement of the codeshare and the type of partnership the airlines have. When problems happen in route, it becomes confusing who to go to for help.

Travelers should always ask (online web portals may not tell you) who the actual operating airline is, who's rules apply and what the restrictions are.

The "Fly America Act" comes to mind when government funded travel stipulates the use of a "U.S. flag carrier", and a traveler finds himself/herself on a foreign flag carrier.

Your travel consultant at Premiere Travel will help you navigate all these nuances and complexities that may not seem to be too obvious.

www.premieretravel.com

Irene Aftermath: Repositioning Aircraft and Crews

The biggest challenges facing the restoration of normal flight operations are the repositioning of aircraft and crew, and accommodating tens of thousands of travelers that were affected.

Washington area airports will recover more quickly than New York and Boston Airports. It will be at least till Tuesday before things return to normal.

We continue to advise travelers to check the status of their flights before they head to airports.

www.premieretravel.com

Tips for Re-scheduling Your Flights

As Hurricane Irene approaches the East Coast, airlines are issuing bulletins on their websites advising about cancellations and re-booking policies.

Passengers have to take into account the "terms and conditions" the airlines are allowing "free" changes. Most carriers for example mandate that you begin your affected trip no later than September 4, 2011. There are many problems with such conditions: They include:
A) The purpose of the trip is lost (i.e. attending a wedding or a an event)
B) With so many passengers making changes and flights heavily booked due to reduction of capacity, it is unlikely you will find seats even if you flexible.

Best thing to do would be to wait for the airline to cancel the flight and this would activate Rule 240, a regulation era rule that says the airline has to accommodate you on the next available flight or connections acceptable to you, or fully refund your fare.

www.premieretravel.com

Hurricane Irene Update

The National Weather Service latest hurricane tracking shows a wide swath of affected areas on the east coast that will be impacted by the projected path of Hurricane Irene.

Please check the status of your flights, particularly Saturday and Sunday with your airline or at www.premieretravel.com

Due to very heavy call volume anticipated, airlines' response time as well as all 24-hour emergency services may experience long delays. Please use the emergency numbers only for emergencies. Flight status can be checked on our website or with the airline. Many of our agents will be on stand-by to assist our travelers the best we can.

www.premieretravel.com

Airports Operations Resume After Earthquake Disruption

August 23, 2011 (6pm update): Airline operations resumed mid-afternoon but delays and some cancellations will linger through the evening. Favorable weather conditions will help operations get back to normal.

However, Hurricane Irene is expected to show up later in the week and airlines have already started to issue one-time waivers for passengers that may be affected.

Please check your flight status at www.premieretravel.com

www.premieretravel.com

Earthquake Disrupts Mid-Atlantic Travel

a 5.9 magnitude earthquake originating in Mineral, Virginia has caused air traffic to halt at DC airports, Philadelphia and New York Airports where control towers had to be evacuated.

This is a fluid situation with significant disruption expected to reverberate throughout the afternoon.

Runways and tower controls will be inspected prior to resumption of services. Incoming and outgoing flights will be delayed while this mess is being sorted.

www.premieretravel.com

Another Trial Balloon-Airlines Contemplate Surcharges on Credit Card Use

A Major airline in Europe has started imposing a "surcharge" for using credit cards to pay for airline tickets in six markets, dubbed as a trial.

While it is quite understandable that airlines want to reduce costs, this could potentially be a game changer.

Companies and individual travelers have become accustomed to paying for travel by credit card and receiving points, rebates and benefits.

Travel Management Companies are also happy not to extend billing and wait for payments. It is the airlines that are the actual merchants in the vast majority of the cases, and it is the airlines that pay the merchant discount fees to the credit card companies. With major airlines doing billions a year in sales, it is easy to calculate what a 1% to 2% saving would do to the bottom line. But this will likely run into a firestorm of opposition and most likely incur the wrath (and the strong lobby) of the banks and credit card companies that benefit from the merchant fees.

www.premieretravel.com

U.S. Aviation Tax Reinstated

The U.S. Congress has reached an agreement to temporarily extend full funding for the Federal Aviation Administration (FAA) through September 16 and as a result, the FAA authority to collect federal aviation taxes will be reinstated.

For tickets sold beginning 12:01am on Monday August 8 the following taxes will apply:
• The 7.5% tax generally applicable to domestic transportation (as well the 7.5% tax on amounts received from the sale of "frequent flyer miles".)
• The $3.70 domestic segment tax.
• The $16.30 international arrival/departure tax.
• The $8.20 departure tax for flights between Alaska/Hawaii and the mainland US.

The I.R.S. has also put an end to the speculation about tax refunds for travelers who may have paid taxes and traveled while FAA's mandate had expired, stating "there will be no refund".

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Congress Goes Home , Airlines Continue to Pocket Windfall

As the bleary-eyed Congress members head home after passing the debt ceiling legislation, airlines will continue enjoying the benefits of the partial FAA shutdown in which no domestic taxes on air tickets are being collected and the airlines have eagerly stepped in to mop up the difference in airfare through stealth fare hikes that offset any tax savings for travelers.

While estimates vary, airlines may wind up pocketing a windfall of at least $1.3 billion before Congress decides to reinstate the tax collection.

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Airlines Announce More Capacity Cuts

Major airlines are further reducing capacity and raising fares again to offset fuel costs which seem to be here to stay.

Higher fares, more user and ancillary fees, and fuel surcharges will probably add another 5-10% to the average airline fare for the balance of 2011.

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The Tax Mess On Airline Tickets

Due to inaction by the U.S. Congress, the Federal Aviation Administration (FAA) reauthorization bill was not passed. As a result, the FAA began experiencing a partial shutdown at midnight on Friday, July 22, 2011.

As a result of this "inaction", airlines, while you were sleeping, immediately implemented fare increases to offset any potential savings for travelers.

Business Travel Coalition and Travel Management Companies (TMC's) are raising the issue that travelers who are traveling during the shutdown may be due tax refunds for taxes already paid when they purchased their tickets for travel prior to July 22.

Premiere Travel will be keeping track of these taxes paid by our clients in the event that a determination is made that refunds are due, and will file any necessary paperwork and claims on their behalf.

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Airlines Rush To Raise Fares As Taxes Expire

Not wasting one moment, American and USAirways among others, raised their fares to offset the expected savings that travelers should realize when Congress failed to pass legislation to keep the FAA running.

At 12:01 on July 23, airlines were not required to collect taxes, and so to avoid "confusion" and "inconvenience", some airlines raised their fares effectively wiping out any break for the traveler.

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Delta to Tighten Grip on LaGuardia and USAirways on Reagan National

The U.S. Department of Transportation rubber-stamped a deal between Delta and USAirways allowing carriers to swap slots at Reagan National and New York LaGuardia Airports.

With minimal adjustments, Delta will control half the slot pairs at LaGuardia and USAirways will tighten its hold at National.

Both airports are ultra-congested and the only opportunities for growth is through slot swaps by airlines.

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Better Disclosure of Airline Fees on Horizon

The U.S. Department of Transportation will require airlines to break down and disclose the revenue they derive from ancillary fees and report 14 additional categories that are currently tucked away under one large category.

Very soon, your airline ticket breakdown may resemble the sticker price of an automobile.

By disclosing these fees, which include the sale of items such as beverages, meals, pillows and blankets, airlines may be required to collect/pay federal excise taxes of 7.5% on some of these services resulting in more complications.

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Airlines Not Doing Well in this Customer Survey

The Atlantic Survey published recently for the "19 most hated companies in America" was not too kind to domestic airlines. Four carriers made it all the way to the "Top 10" portion of the list of 19.

Excessive fees, delays, poor customer service were the main reasons airlines competed with banks, cable and phone companies for this undesirable designation.

To see the survey, please click on the link below:
http://www.theatlantic.com/business/archive/2011/07/the-19-most-hated-companies-in-america/241344/

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The Future of Travel Distribution

As the second half of 2011 is under way, many important changes are already under way in how travel information, content and distribution will be shaping up in the near future.

The Travel Management Company (TMC) channel has lagged in keeping up with the technological advances. Global Distribution Systems (GDS) that agencies have relied on for so long, have not adapted to the changes in the airline distribution model and how content is offered.

It was only a matter of time before the latest innovations in information technology would offer some exciting opportunities that would revolutionaize travel as we know it today.

Organizations such as Openaxisgroup.org, with key membership and support from many major airlines is already out promoting the XML based electronic messaging structure for airline system connectivity worldwide.

American Airlines is the first carrier that is spearheading the movement to this great exciting technology with their "Direct Connect" that will transform the travel distribution ways for a better and more efficient future.

For corporate clients, it would be a welcome change in integrating all services and ancillary fees under one easily understood and clear format. It would represent a "one stop shop" geared to serve the specific needs of travelers.

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OnePass Program of Continental to Merge with Mileage Plus of United

United/Continental is forging ahead with merging their schedules and programs toward the final end of being one single carrier by the first quarter of 2012.

Continental's OnePass members will be rolled into the Mileage Plus of United and members will hold on to their respective statuses.

The result will be a large number of "elite" status travelers, but overall a better program for all.

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Over Taxing Travel

Travelers are getting over-taxed.

Here's why:
The U.S. Department of Transportation charges an excise tax of 7.5% of the airfare plus $3.70 per segment. That makes the average domestic ticket carry about 10% in taxes and "user fees". But what happens when the passenger cancels the trip and does not use the ticket for future travel?

The Department of Transportation imposes the tax for the "sale" of air transportation, not for the transportation itself. Airlines act as the tax collectors supposedly transferring collected taxes to the government. Interestingly, the Department of Transportation gives airlines the leeway if they choose to refund tickets to also refund the taxes, putting a hole in the theory that taxes are collected for the sale and not for transport.

Similarly, airport aurorities supposedly get to keep "user fees" even if the passenger did not use the facilities.

Moving to international travel, it becomes even more pronounced. Airlines will not refund the "fuel surcharge" even if they did not transport the passenger. It is tantamount to paying a cab fare surcharge when no service or transportation was rendered.

Bottom line, taxes, user fees and surcharges may be refunded if the airlines want to.


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The New Normal in Air Travel: More Fees

We have now seen how creative airlines can be when it comes to concocting fees of all sorts for what used to be free not so long ago.

Every month, passengers are greeted with an ever increasing array of ancillary fees that are generating billions of dollars in revenue for the airlines. The golden goose is here and the milking process is in full swing.

Expect that this trend not just to continue, but to be further "enhanced". From TSA fastlanes to priority boarding and everything in between, passengers should expect to pay a higher percentage of their travel costs for fees that are still difficult to account for.

Taking this to a new horizon, programs are being rolled out so travelers can purchase "memberships" that require annual fees to prepay for a year's worth of certain ancillary services such as extra leg room seating or luggage.

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Airline Branded Credit Cards Increase Amenities and Benefits

Major credit cards have been aggressively promoting airline branded credit cards touting all kinds of privileges and benefits for those who apply.

Your "pre-approved" solicitation comes beautifully packaged and will bear names that evoke luxury such as "Gold", "Platinum", "sapphire" etc... and adorned with your favorite airline logo, promising sign-up mileage bonus of 25,000 to 50,000 miles.

The aggressive promotions will promise many things including checking bags for free for up to 9 passengers on the same itinerary to lounge passes and yes...more bonus miles and discounts for vacations and cruises.

While some of these benefits are worthwhile, especially families that travel together.
(One trip for family of four will result in $200 baggage saving), you may have consider other factors to get the biggest bang for the buck. For example if your status is high in your frequent flyer program, you may already be receiving all the promised benefits.

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So Why Use a Travel Management Company When You Can Do It Online?

The airlines and the plethora of online websites would like you to think that you can do everything online (on their websites of course) and pay little or no fees.

While this may be true for the simple domestic trips involving point to point, the theory does not hold up well in today's world of travel complexities.

Consider things like weather disruptions that cause delays or cancellations, industrial actions, civil uprisings, earthquakes, volcanic ash and travel warnings, and you will need an advocate on your side looking for your best interests. Anticipating problems, expecting the unexpected are the core values of a good travel management company. Websites and robots will not call you to warn you of potential disruptions to your travel and will not have alternatives for you. Changing online bookings are so difficult that many travelers once affected, realize the value of the special relationships that they can have with a professional that knows your personal preferences and can get you there and back safely.

The State Department has a new registration program called Smart Travel Enrollment Program (STEP). This enhanced program which requires registration on the part of the traveler, will enable embassies and consulates abroad to know your whereabouts in the event of emergencies and evacuations and can get in touch with you or your designated contacts. It is highly recommended for travelers visiting destinations that are considered high risk and have travel warnings and advisories.

For more details about the program, please click on the link below:
https://travelregistration.state.gov/ibrs/ui/

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Discount Vs. Legacy Airlines

Passengers have become accustomed to receiving lower fares when they ask for Southwest Airlines, Jet Blue and Air Tran. However recently, the legacy airlines, United, Delta, American and others have closed the gap.

The advantages that "low cost" carriers had in the past are vanishing. For one thing, their fleets are now aging, their maintenance is higher, and they have the same efficiency as the legacy carriers. All airlines have to cough up the dough at the gas pump as jet fuel prices have surged. In the past, Southwest Airlines have deftly played the hedging game to near perfection, but nowadays it is more of a level playing field.

Labor costs are trending to about the same, although Southwest still has the advantage.

Legacy carriers have also done a skilfull job in leveraging their presence worldwide through joint ventures, alliances and code shares.

IATA has just lowered guidance for airlines profitability in 2011 mainly due to fuel costs. Ancillary fees, the new cash cow for airlines are expected to generate a higher percentage of airline revenue going forward.

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Ancillary Fees Tab 2010: $22 Billion and counting

Airlines worldwide are ringing up ever staggering amounts of money from all those pesky ancillary fees. The Wall Street Journal reported on a study out Tuesday that tabbed airline revenue from add-on fees jumped to nearly $22 billion dollars last year. That's up 38 percent from a year earlier.

Ancillary fees have become a godsend to airlines. It is the oxygen in their tanks that keep them afloat. Airlines will continue to find creative ways to come up with new fees. For example, fast line security, a TSA function, is now another fee producer for airlines. To go to a shorter security line reserved for "Premium Passengers", you will have to cough up $19. Ancillary fees and how they are disclosed have become a solution looking for a problem.

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Volcanic Ash-Part 2

A plume of volcanic ash from Iceland's Grimsvotn volcano is causing anxiety in some parts of the U.K.

More than 500 flights had been impacted on Tuesday, and many others had to be diverted to avoid the affected area. Most of the delays are slight, as new paths are being charted.

The good news is that the volcano has lost the steam, and having learned from the gross over-reaction when most of European airspace was shut down last year, the impact of this one so far appears to be contained.

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Expiring Miles-Problems Redeeming Mileage Awards

Feeling like being chased by that gigantic red tape ball as in Southwest Airlines commercial? You're not alone....

Millions of "loyalty program" members don't receive the appreciation when the time comes to redeem their mileage that they worked so hard to accrue.
If lucky enough to find seats, they are greeted with lots of "ifs and buts" along with a slew of fees for the "free" tickets. Changes carry fees and penalties, making some free tickets quite costly.

Premiere Travel can assist in helping clients in managing their frequent flyer programs by offering redemption opportunities beyond travel and limiting the expiration of mileage awards.

Each year 30% of mileage balances expire. That is trillions of miles each year. Value added promotions, donations to charities, and merchandise are some of the opportunities missed by members. The award system is designed not to work in your favor.

For more information of how Premiere Travel can assist you in managing your mileage awards, please send us an email to:
support@premieretravel.com

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Airlines Expect An Increase in International Summer Travel

Higher fuel surcharges and fares do not seem to be deterring Americans' appetite for international travel. Airlines are predicting an increase in the number of passengers traveling from the U.S. abroad.

Advance booking indications are healthy and combined with 1% lower capacity, travelers should expect to see fuller planes and higher fares this summer.

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Southwest completes Air Tran Acquisition

While travelers in Atlanta will not see the ubiquitous colors of the Southwest 737's anytime soon, the airline sealed the deal to buy Air Tran, the second largest carrier in the Atlanta market with over 200 flights a day.

Southwest plans to keep Air Tran as a separate carrier at least through the end of the year and may be longer.

Delta said it "welcomed" the opportunity to compete with Southwest on its home turf.

Air Tran's network complements Southwest's as it adds markets not served or under-served by Southwest. It remains to be seen what strategy Southwest has as the two airlines have different business models. Primarily, in addition to the difference in baggage fee policy, Southwest does not assign seats while Air Tran does.

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Delta Plans 4% Capacity Reduction

Delta Airlines, stung by the high cost of fuel announced capacity cuts of about 4% of its schedule after the summer high season.

It also offered early retirements and buyouts to some of its employees. Among other measures, Delta is retiring many of its fuel inefficient airplanes, downsizing some and replacing them with smaller but more efficient equipment.

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Fuel Surcharge Reversal?

Price of crude oil and jet fuel has gone through a "mini crash" in the past few days. Prices have gone down about 10% in less than a week.

So what are the airlines going to do now? Historically, airlines have shrugged off declines in fuel costs, but are always very quick to react when the prices go up.

At the moment, no carrier is rushing to mark down their "fuel surcharge" which has reached a record $424 for a round-trip transatlantic ticket.

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Global Travel Alert Issued

The US State Department has issued a global travel alert to all US citizens following the death of al-Qaeda leader Osama bin Laden, warning of 'enhanced potential' for anti-American violence.

The US also put its embassies on alert, warning Americans of reprisal attacks.

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Mileage Redemption Harder to Redeem

With airlines downsizing aircraft and selling more seats, frequent flyer members are having a hard time redeeming their mileage awards.

Seats assigned for frequent flyer redemptions are being reduced or outright eliminated. On popular routes, travelers find it impossible to redeem their miles no matter how flexible they are.

If they do find seats, they are greeted with a slew of fees to redeem their "free awards".

The game has changed so much over the years with millions of new members raking in big miles even when they don't fly. Signing up for a new credit card will make the applicant eligible immediately for a domestic ticket. Purchases of any product or service are eligible to receive mileage credits.
The result is the worst of both worlds: way too many people competing for more scarce seats.

At some point, loyalty will be on the line if airlines cannot deliver opportunities for redemption.

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The Theory Of Relativity: Fuel Surcharges Then and Now

Back in 2008, when prices of oil and jet fuel soared to an all-time high, airlines scrambled to increase their "fuel surcharge" for international flights. At that time, the peak price of oil was $146.

The surcharges back in 2008 pale compared to the surcharges of 2011 which are now averaging $420 per ticket for European flights. Relative to today's oil price of about $112 for WTI crude, the airlines' surcharge is a whopping 50% higher than it was in 2008. Fuel surcharge has become another tool for airlines and it does not often show up in fare comparisons.


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St. Louis Lambert Limps Back

St. Louis Airport operated at near 70% capacity on Sunday after a devastating tornado made a direct hit causing substantial damage to facilities around the airport.

It is expected that most flights would operate z normal schedule by mid-week. Passengers would be well advised to check the status of their flights for delays and cancellations.

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Rare win for Travelers-Airlines Must Pay Up for Bumped Passengers

Airline passengers will see increased compensation for denied boarding from oversold flights. Additional consumer-friendly measures will also be implemented this summer.

Scheduled to be unveiled Wednesday, the rules drafted by the U.S. Department of Transportation also mandate an end to hidden fees tacked on to ticket prices and expand other passenger protections. Carriers must pay if they lose a suitcase after charging passengers checked-baggage fees.

Among the more consumer-friendly provisions, customers who reserve a flight at least one week before departure will be able to lock in the quoted airfare without payment for at least 24 hours after the reservation is made. They also can cancel a reservation within at least 24 hours without incurring a penalty.

Distribution Wars: More to Come

Battle lines are forming that could decide the way airline tickets, services and ancillary fees are distributed in the future.

The key players, aside from the airlines, are the Global Distribution Systems (GDS), Online travel companies, and travel management companies. All are jokeying for position to shape the future of travel distribution.

Multi-billion dollars of revenues are at stake, and one thing is for sure, changes are coming.

American Airlines has just filed legal action against Orbitz and parent Travelport alleging that Travelport and Orbitz have worked together and with others to exclude competition and maintain Travelport’s “monopoly power".

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Feeling Lucky? Google Travel!

The Justice Department gave the greenlight to Google to acquire ITA Software, the travel search engine, for $700 million dollars.

But regulators imposed a host of restrictions on Google, saying the deal as initially proposed would have violated antitrust law by giving the world's leading search engine "the means and incentive ... to foreclose or disadvantage" its rivals, such as Orbitz, Expedia, Kayak and Microsoft's Bing. Those companies use ITA's software to power their airfare travel searches.

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Airlines Try To Raise Fares for the 10TH Time in 2011

In baseball analogy, airlines are batting .600...
That's because they made 10 attempts in 2011, including one this week, to raise fares. The increase held up 6 times because all the carriers that need to match did.

Four times however, there were key airlines that were not quite ready, and when this happens, carriers that implemented fare increases, roll them back for fear of market share loss.

With the price of jet fuel going exponentially higher, and airlines not having the correct hedging strategies, the costs are increasing dramatically, and passengers are feeling the sting of the high fuel surcharges and fare increases.

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Air Fatigue: Today's Flying Experience

Road warriors, or should we say air warriors are experiencing some fatigue and outright irritation at things that have compounded to make the flying experience difficult, even for the battle hardened.

Here's some of the "irritants":

1) Longer lines at security
2) Intrusive, inconsistent and ever changing variations of security "requirements"
3) Overcrowded "VIP" lounges
4) Too many "high status" travelers competing for fewer upgrades
5) Less legroom and personal space
6) Nickeling and diming for every conceivable service
7) Delays delays delays
8) Completely full flights
9) Less and less choices

Add high fares and taxes to the mix and it becomes easy to realize that while travelers have learned to expect to pay more for less, they are approaching the point where they are fed up.

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Fare Increases and Ancillary Fees Taking a Toll on Travel Demand

Travelers are getting accustomed to paying an ever increasing number of ancillary fees that airlines keep dreaming of.

With the big increase in fuel costs, airlines did not waste any time in implementing seven fare increases in 2011 alone. Fuel surcharges have also moved up for international travel.

Airlines have also responded by cutting capacity further by an average of 1.5% of the available seats in 2011. Many discounted fares have been quietly removed from inventory.

While flights might appear to be jam-packed, let us not forget that the reduction in the number of flights and the downsizing of aircraft is giving the false appearance that things are going well for the airlines.

However, the sky rocketing fares are finally catching up with the cost conscious travelers and many are beginning to push back. Some fares to destinations with little or no competition are at historic highs.

Some airlines will probably log losses for the current quarter as many have been unable to hedge for their fuel costs which account for 35-40% of their total operating costs.

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Major Fuel Fire Disrupts Miami International Airport

March 24-A major fuel fire erupted at Miami International Airport overnight. While the runways are far from the fire, the loss of some fueling operations will cause delays to flights leaving Miami on Thursday.

American Airlines, with a major hub in Miami will likely experience most of the disruption.

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Who's On First? Reagan National Control Tower Went Silent...

The control tower at Reagan National Airport went silent Wednesday, forcing the crews of two planes carrying 165 passengers total to land without any help. The two planes were communicating with controllers at a separate facility in the region that doesn’t handle landings, but the pilots of both planes had to take matters into their own hands. The incident is the second time in two years the control tower at Reagan National has gone silent for a period of time.

An investigation into the incident is underway, but there is still no version, what caused the silence from the tower. Shortly after the incident, U.S. Secretary of Transportation Ray LaHood ordered inspection of all airports in the country. He also ordered to have two, instead of a one, traffic controllers on duty at the control tower of the Reagan National Airport between midnight and 6 a.m.

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District Of Columbia Sues Online Booking Agencies

Attorneys for the District of Columbia filed a lawsuit Tuesday against online travel companies including Expedia, Orbitz, Travelocity and Priceline, alleging the companies owe the city millions of dollars per year in sales tax that they aren't paying.

The lawsuit in Superior Court in Washington is similar to more than 40 others pending around the country, and cities have met with mixed success in cases already decided by courts. The District's lawyers, like their counterparts elsewhere, contend the companies charge customers hotel tax on the full price of a room but only return tax to the city based on the wholesale rate the company paid.
(Associated Press)

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Boeing blames Japan Earthquake For Another Dreamliner Delay

Boeing said that it was assessing the impact of the Japanese earthquake disaster on aircraft production, warning of a potential supplies crunch if disruptions continued for several weeks.

The Chicago-based aerospace giant relies on Japanese companies for 35% of the content of the much-delayed 787 Dreamliner.

Factory disruptions may affect availability of key components for the Dreamliner.

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Tokyo Narita and Haneda Re-open for Some Outbound Flights

Both Airports have re-opened for limited outbound flights.

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Airlines Scramble to Cancel Flights to/from Japan

Commercial air service to/from Japan have been halted due to the massive earthquake that hit Northeast Japan this morning. Aftershocks and tsunami warnings may affect a much wider area potentially affecting travel not just in Japan, but in the rest of east Asia.

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A Fee to Recline Your Seat!

Another convoluted thought drummed up by some clever airline executive adamant to make the travel experience even more miserable than your worst expectations...seats that don't recline, or if they do, ka-ching!

This is meant to squeeze more seats into an already crowded cabin. Next step: Sardine seating..translation: No Leg Room!

Nothing surprises anymore. In this post, the upright seating was mentioned and so was the lavatory charge...

And yes, thank you for choosing our airline, we aim to please!

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(A Charlie Sheen-free website)

Airlines Hike Fares For the 6TH Time in 2011

In case travelers are wondering why domestic fares have become so high so quickly, look no further than six fare hikes just in 2011...

While we are still in the first quarter of the year, and the oil prices are making highs not seen since 2008 when oil hit $147/barrel, the quick-to-react airlines waste no time every week to take advantage.

When oil prices roll back on the other hand, airlines really take their time to roll back their fares and fuel surcharges.

The recent Department of Justice charges against 21 airlines for price fixing is the tip of the iceberg. Airlines do act in concert, and when one or more competitor would not "go along" with fare hikes, something amazing happens: those who do increase fares cancel those increases "for competitive reasons".

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21 Airlines Fined For Price Fixing

During the recession years of 2000-2006, airlines were scrambling to survive the downturn in the economy and stay alive. But according to federal prosecutors, what they came out with was a massive price-fixing scheme that artificially inflated "fuel surcharges" and cargo rates for international travelers and shippers.

The court cases brought by prosecutors alleges a conspiracy to fix rates and fees for flights originating and ending in the U.S.

The airlines accused have already paid fines in excess of $1.7 billion, and many executives involved have been charged by the U.S. Department Of Justice. Four executives are serving time in jail.

Among the culprits convicted are British Airways, KLM, Air France, and Korean Airlines.

All airlines, none of which are U.S. flag, were convicted in violating the Sherman Anti-Trust Act.

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Not "Up In the Air"...American Airlines Cuts Flights

American Airlines is continuing the trend of airlines trimming capacity as the industry tries to grapple with rising fuel costs by reducing flights and hiking fares.

Capacity would be reduced by about 1% overall.

In addition to sky rocketing fuel prices, airlines had to contend with serious weather disruptions in January and February that increased costs and will likely result in some losses.

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Airlines Respond To Fuel Costs By Increaseing Fares And Reducing Capacity

The geopolitical situation in the Mideast has caused oil prices to sky rocket over the past few days causing airlines more headaches with the fuel costs.

A new round of fare increases have taken hold this week, and fuel surcharges are being implemented or increased on international flights.

The airlines have no choice but to increase fares, reduce capacity, frequency and eliminate or cancel flights.

Already the high fares are resulting in reduced demand. The situation is most dire for the last minute business traveler as some fares have gone up by an average of $80 over the last round of increase announced just two weeks ago.

Airlines often are caught on the wrong side of fuel hedging. Most airlines purchase fuel on the spot market or near term contracts. The double digit increase in the past two weeks will dampen demand.

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Good News Fare...Bad News Taxes and Fees

On a recent search for a fare from Washington Dulles to London on Virgin Atlantic, passengers would have been thrilled to see how deeply discounted the winter fares are this year.

The example below is to demonstrate the absurdity of taxes and fees:

01MAR DEPARTURE DATE-----LAST DAY TO PURCHASE 23FEB/2359
BASE FARE TAXES TOTAL
1- USD130.00 482.10XT USD612.10ADT
XT 292.00YQ 32.60US 5.50YC 7.00XY
5.00XA 2.50AY 96.20GB 36.80UB
4.50XF
130.00 482.10 612.10TTL
ADT-01 OLXSLE
WAS VS LON65.00OLXSLE VS WAS65.00OLXSLE NUC130.00END ROE1.00
XFIAD4.5
NONEND/PENALTY APPLIES
VALIDATING CARRIER - VS

For an itinerary leaving Dulles on March 1 and returning on March 8, the fare that Virgin charges is $130...yes, you are reading this correctly...$130! Then the fun begins...Take a look at all these obscure codes that you will see on your e-ticket...each one will jack up the cost of your fare to the final cost of $612.10. While this is still a very good deal, it may explain how some airlines lose money and how your taxes and fees are charged.

For those who like to explore the labyrinth of the tax, and fee system, here's enough for you to feast on:
YQ = Fuel Surchage fee
XA = APHIS User Fee
XF = Passenger Facility Charge
US = Transportation Tax
AY = Passenger Civil Aviation Security Service Fee
YC = Customs User Fee
GB = Air Passenger Duty (APD) Fee
XY = Immigration User Fee
UB = Passenger Service Charge
XT = The aggregate total of all taxes, surcharges and fees

So next time you see a "promotion" for a $130 to London, hold on to your hat as the airline, airport authorities, FAA, TSA, Immigration and Customs, and Uncle Sam will all have their palms extended to lighten up your wallet...

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United/Continental to Downgrade Trans-Atlantic Service at Dulles

It did not take long for the new management at United to start tinkering with the Dulles hub.

Starting in June 2011, service to/from Paris will reduced to a 757-224, an older aircraft owned by Continental, replacing 767 and 777 service on the late daily second flight to/from Paris.

The bigger United aircraft will be shifted to Newark airport where Continental will add to its already beefy presence there.

Amsterdam is the other city that will be affected, and that too will be serviced by Boeing 757. The bigger United aircraft will also be shifted to Newark.

When service is reduced to/from Paris in the fall to once a day, Continental will be servicing Paris with a single daily 757 service.

The two cabin service with single aisle aircraft will likely be unpopular on flights that will take between 8-10 hours, and will open up opportunities to competitors such as Air France, KLM and others to take market share from United/Continental.

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While Dreamliner is Delayed, Boeing Unveils a new 747

The latest version of the most recognized airplane in the world was introduced yesterday in Everett, Washington.

The bigger, quieter and more fuel efficient 747-8 is configured to seat 400-500 passengers, with a more pronounced upper deck (big top).

The 747-8 will have many of the technological breakthroughs and features of the Dreamliner. Lighter alloys, lesser carbon emmissions, and lower operating costs are the key selling points. 33 passenger jets are already on order.

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Citing Increase in Fuel Costs, Airlines Raise Fares

Fare increases targeting the business and premium travel were quietly implemented in the past few days.

Airlines have blamed the need for the increase on fuel prices. It is the good old cause and effect. Airlines are quick to respond to fuel price increases by implementing "fuel surcharges" on international flights and fare increases on domestic flights.

The opposite is not true. When fuel prices decrease, the trickle down takes much longer to reach the traveler.

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Next Generation Air Transport System Caught in Congressional Gridlock

Air traffic delays, flight cancellations, pollution, and endless frustrations with travel delays can be fixed through a bill in front of Congress known as the Federal Aviation Administration Reauthorization Bill (FAARB).

This $35 billion dollar bill, which has bipartisan support has been languishing for years, and it has been debated repeatedly with nothing to show for it.

The bill would fund the implementation of Next Generation Air Transport System that would change the current controls from ground based to satellite based, taking advantage of major technological advances in precision GPS technologies.

The benefits include a more streamlined and efficient air traffic control network that would save airlines money by burning less fuel, cut down flight distances and unnecessary bottlenecks, cut pollution substantially and provide safer flying environments with more advanced imagery.

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Mother Nature and Travel

As many seasoned and discretionary travelers have now realized, ice, snow, volcanic eruptions, thunderstorms, wind and more are playing a bigger role in disrupting a very sensitive air travel ecosystem. Snow in Houston has forced hundreds of flight cancellations and delays that impacted a major U.S. hub that will reverberate for days to come.

Once you add international geo-political complications, equipment failure, tight schedules, and congestion, it is not hard to realize that small and seemingly unrelated events can converge to be a disrutive force that can become a huge inconvenience to tens of thousands of travelers.

Airlines, airport authorities, and the FAA must work together to bring air travel to the 21st century. We have relied far too long on outdated methods, equipment and procedures that cannot handle today's and tomorrow's needs.

www.premieretravel.com

When They Close Schools in Chicago....

...They close airports and cancel flights too.

A massive storm is paralyzing most of the country as blizzard conditions are prevalent.

Travel, yet again, is severely disrupted as airports, airlines and passengers struggle to deal with another blow to travel plans this winter.

Airlines are now accustomed to issuing travel waivers to travelers affected, and it will take a while to sort through this mess.

Before heading to the airport, travelers are well advised to check the status of their flights.

www.premieretravel.com

U.S. set to evacuate American Citizens from Egypt

The U.S. State Department has announced plans to evacuate Americans stranded in Egypt.

The U.S. Embassy in Cairo has over 52,000 Americans registered in Egypt. Over 2400 have already requested assistance in leaving the country.

The State Department will be deploying chartered aircraft and will be relying on friends and relatives in the U.S. to reach starnded Americans in Egypt.

For more information on this fluid situation, please check:
http://www.state.gov/

www.premieretravel.com

New Travel Advisory for Egypt

The U.S. Department of State has issued a "Travel Alert" for Egypt in light of the on-going violent demonstrations and social unrest that appears to gain momentum on Saturday.

Almost all tours, cruises and travel are being severely disrupted and travel to Egypt should be avoided for the time being.

U.S. citizens currently in Egypt should remain in hotels and residences until the situation stabilizes.

www.premieretravel.com

Winter Weather Advisory East Coast- Another Chapter

The mid-atlantic region once again is bracing for yet another winter storm that is moving from the south and expecting to disrupt travel across the eastern seaboard.

United Airlines has issued travel waivers for travelers to/from/through:

DCA – Washington D.C.
IAD – Washington Dulles
BWI – Baltimore, MD
PIT – Pittsburgh, PA
MDT – Harrisburg, PA
PHL – Philadelphia, PA
AVP – Wilkes Barre/Scranton, PA
EWR – Newark, NJ
JFK – New York City, NY
LGA – New York City, NY
HPN – White Plains, NY
ALB – Albany, NY
BDL – Hartford, CT
PVD – Providence, RI
BOS – Boston, MA
MHT – Manchester, NH
PWM – Portland, ME

For tickets purchased on or before January 25, 2011 and travel covering January 26-27.

Please check your flight status with at www.premieretravel.com or your airline's website.

www.premieretravel.com

Lavatory Fee...Why not?

Airlines executives are looking at their financial results for 2010, and they do see things that they like...ancillary fees recorded their best year ever, with a total that may have well exceeded $10 billion.

With reduced capacity, comes fuller airplanes, and along with reduced competition due to mergers, code sharing and alliances, it is not that consumers have real choices left when it comes to air travel. So airlines can choose to charge what they want when they want it, and travelers have to open their wallets.

So why not think of the unthinkable? First, when the concept of charging fees for checked-in bags, meals, drinks, enhanced seats, etc. were gradually rolled out, vanguard airlines were worried their competitors would not match and they would have to roll back, but soon almost all, with Southwest as the notable exception, did. So how do you top that phenomenal source of revenue in 2011? One thing one airline started is complaining about the "high cost" of distribution and display of its inventory. So under the guise of a "better traveler's experience", they want the distribution to go to a "direct connect" and cut the "middleman" out.

On the fee side, it won't be long before we see a card swipe type of lock on your aircraft lavatories should you wish the privilege of using it. Airlines always claim that they are only recouping costs and that passengers who do not use "services" would not have to pay for them.

www.premieretravel.com

Dreamliner by Boeing Coming Soon!

Boeing announced that the first delivery of the long anticipated and much delayed Dreamliner 787 will happen in the third quarter of 2011.

The delivery time takes into account all the additional testing that still needs to be performed to complete the certification process.

Boeing badly needs the 787 to regain lost market share to European rival Airbus.

The price tag (MSRP) of the Dreamliner ranges from $185 million to $218 million.

www.premieretravel.com

Cheap European Travel?

Flying to Europe this winter may be cheaper than flying to Boston! As the tradition goes, fares to Europe from the U.S. are again very cheap. The only crazy thing is that you end up paying more in taxes and user fees than the actual fare.

There are so many deals out there. While airlines keep trying to reduce capacity, many seats are still going unfilled.

To add yet another incentive to travel, you don't have to stay in one city. The wide proliferation of discount carriers in Europe means that you can go to a second, third or even fourth city for less than a $100 per stop.

Hotels are also rolling the red carpet with "specials". For example some chains have 50% off or: "stay 2 nights get the third for free"....

With a euro that declined year over year versus the dollar, this may be too good to pass up.

www.premieretravel.com

More Weather Disruptions on Tap

A new weather front that wreaked havoc in the south on Monday is now making it's way to the mid-atlantic region and will likely impact air travel in the Washington, Philadelphia, New York areas.

Passengers should double check their flight status this afternoon and evening. Airlines will issue waivers for airports that will experience cancellations or major delays.

Delta and other Atlanta based carriers had to cancel hundreds of flights yesterday and today. Road conditions in the south remain treacherous.

www.premieretravel.com

Social Media Powers Into Travel

Travel Suppliers, Airlines, Hotels, Tour Operators, and yes, even Travel Management Companies can no longer deny the powerful role of social media in travel choices and decisions.

Strategies are being crafted with facebook and twitter in mind. The trend is overwhelming and unmistakable...social media are destined to play a very big role in travel.

This trend is becoming a fast reality. Print media publications seem to be the clear loser, as suppliers shift their attention to the internet's new media and reducing their advertising budget in "traditional media".

Facebook has in excess of 600 million members, and twitter's growth is in the exponential stage. The nature of the travel experience favors social media perhaps more than most businesses.

www.premieretravel.com

Distribution Wars: American Airlines Vs. The World

The skirmish that started between American Airlines and Orbitz (the online booking engine) in November of last year has now turned into an ugly and expanded war between Global Distribution Systems and American Airlines.

Expedia joined the fray in December in solidarity with Orbitz by removing American Airlines availability from display or "downgrading" it to secondary pages.

Now Sabre Travel Solutions, one of the largest travel distribution systems, and Travelport, have also fired back at American. Sabre will downgrade American's availability, and some agents will not even see the American options.

While nobody know how this scenario will continue to unfold, one thing is for sure, that we are on the cusp of major changes in how airline seats are distributed and the air travelers will once again be victimized.

www.premieretravel.com

At Your Service...

Normalcy seems to have returned to the mid-atlantic/New York,and New England regions after the blizzard and the resulting air travel disruptions.

Airlines, as expected, did a terrible job in their preparedness and response to such predictable events such as weather...

One group of travelers that did not quite suffer are those who are customers of travel management companies who scrambled mightily to accommodate their customers and be on their side when needed most.

Joe Sharkey agrees. In his "On the Road" article published in the New York Times yesterday, he drove the point home.
http://www.nytimes.com/2011/01/04/business/04road.html


www.premieretravel.com

Travel 2011- Wish List

Top 10 Wishes for a great 2011 travel year:

* Airlines would treat travelers as valued customers, not sheep

* TSA would operate more efficiently

* Airlines do a better job accommodating stranded and delayed passengers

* Airlines avoid the temptation of adding more ancillary fees and make them easier to account for by corporate clients

* Airport Authorities do more with the tax dollars by improving crowded facilities

* Common Sense ticket pricing

* Make frequent flyer awards easier to redeem

* Cities, municipalities, airports and other taxing authorities to avoid the temptation of punitive taxation of travelers

* Hotels to control and adopt common sense pricing for their room inventories

* For all travel facilities providers and operators to provide a better "traveler experience"