Several readers emailed links to me today to Scott McCartney’s Middle Seat column that argues airlines would be better off without frequent flyer programs. By giving away 10% of their product, major U.S. airlines missed out on some $25 billion in revenue between 2000 to mid-2003, Mr. Beyer says, doing a back-of-the-napkin calculation assuming travelers would have paid for trips taken with awards. Those same airlines posted pretax losses of about $28 billion over the same period. He sees a connection: “There is a cost to these programs, and it’s massive.” Of course this initial calculation is just silly. It makes little sense to add up the free trips and multiply by hypothetical fares. First, the awards wouldn’t all have been revenue tickets without the miles. Second, the bulk of the seats seats being taken…
Monthly Archives
Monthly Archives for February 2004.
Fair and balanced
I’ve criticized Chris Elliott’s columns in the past (see, for instance, this post) but I have to say that his “Fix My Trip” columns where he acts as an ombudsman between travelers and travel companies are exceedingly fair. There’s no pandering to the readership. Though Elliott has been no friend of industry, especially USAirways he also will tell passengers when they’re wrong. His February 1 column is a great example. When Hotwire was in the right, he was willing to tell a his correspondent so. Kudos, Chris!
Keith Alexander — and me — on USAirways woes
Keith Alexander has a column in Monday’s Washington Post on the disaster currently facing USAirways.Their costs are high and their yields are falling. After emerging quickly from bankruptcy protection, they have more or less continued the business model that led them to Chapter 11 in the first place.With the exception of the Northeast Shuttle (which USAirways is looking to unload for cash), I hadn’t flown the carrier in several years until this past weekend. And I can say that they have fallen behind their competitors in premium services. Their clubs, still nicely kept, have less food and fewer newspapers than before. Their planes are greying. I flew in first class from San Juan to Charlotte on Monday and the seats on my 767 were worn. The seatback wouldn’t stay straight up. And the personal video…
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