The business model of US airlines is broken. That may sound strange since US airlines made nearly $8 billion in the first half of 2017. But they’re stagnating. They aren’t earning their profit by innovating or delivering more value to customers. And profits are down substantially from two years ago.
A week ago air berlin filed for Germany’s version of bankruptcy. The carrier has been in trouble for some time, has lost billions of dollars, and their patron Etihad has turned off the spigot.
Germany itself stepped in with a loan guarantee to keep the airline afloat while they figure out options. Most likely that involves selling off pieces of the airline, rather than finding an investor for the whole oneworld airline. Now things are getting really bad.
A roundup of the most important stories of the day. I keep you up to date on the most interesting writings I find on other sites – the latest news and tips.
American Airlines became the first US airline with an international premium economy product last October when it brought its first Boeing 787-9 into the fleet.
American has beaten their September-projected start for beginning the Airbus A330 project, with the first one — tail number N279AY — having been flown from Philadelphia to Paine Field today.
I absolutely love the introduction of premium economy as a product. Eventually I expect it not to be great for upgrades (that in the future upgrades will be from coach to premium economy, and not to business class). And I absolutely love American’s direct aisle access seats, especially the new Super Diamond seats which are the best seats I’ve flown in business class.
The Boeing 777-200s are interesting because they run the gamut and tell a story of the evolution of American’s thinking over the past half dozen years.
We now know a lot more about the airline bomb plot that was foiled in Sydney. The plan was to blow up an Etihad Sydney – Abu Dhabi flight. As usual much of the initial reporting was wrong.
The story at the beginning was that the bomb was hidden inside a meat grinder in a passenger’s luggage, but as luck would have it the bag was too heavy and didn’t get checked. Now that story has changed, and the bomb was supposedly hidden inside a large barbie doll.
There’s a new OTG restaurant at Newark that’s invitation only for United customers. It’s called Classified and the fact that it’s exclusive appears to be the primary thing that’s special about it.
American, though, didn’t just take away benefits from their most loyal (lifetime) customers. They took away travel benefits from legacy American Airlines retirees, too. Retiree travel priority changed in September 2014.
American Airlines travel waivers — the ability to change your travel when the air system is disrupted, such as because of weather or strikes — won’t fully apply to customers booking Basic Economy fares.
This is something American Airlines explicitly promised wouldn’t happen with new Basic Economy fares but that I predicted.
Under the new regime whether it bolts down onto the plane or not it’s for sale and nothing’s free. American has changed their policy, and effective August 30 full fare customers and AAnytime awards no longer receive complimentary Main Cabin Extra and they no longer receive complimentary preferred seats either.
No free extra legroom, no free seats closer to the front of the plane. Buy up, sit in back, or take what’s left.
Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel -- a topic he has covered since 2002.
Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »
