Airlines Announce A Robust Second Quarter 
Overall, the second quarter of 2010 is shaping up as the airline industry’s best in three years, primarily because of a solid rebound in business travel, both in economy class and business class, though still lower than 2008 levels. The Air Transport Association (ATA) reported that passenger revenue, based on a sample group of carriers including Alaska, American, Continental, Delta, JetBlue, United and US Airways rose 25 percent in June 2010 compared to the same month in 2009. This increase marked the sixth consecutive month of revenue growth. "It is clear from these positive results that the recovering U.S. economy is enabling airlines to dig out from the very deep hole of a year ago," ATA President and Chief Executive Officer James May said in a news release. Although traffic has increased for most carriers, the revenue per passenger is up due to tighter inventory, higher prices, and increased ancillary fees. American is the only major U.S. carrier that reported a loss for the second quarter, although is was much less than previous periods. Even for the suddenly profitable airlines, there is still plenty of cause for caution. Most carriers say they will continue to hold down capacity by refusing to add large numbers of new flights. Such discipline is keeping the supply of seats low and the price of fares high.
Source: Seattle PI, Cleveland.com, ASTA
Ancillary Airline Fees Cause Frustration for Travelers, Travel Agents and Corporate Managers
Since airlines began to add new fees for such extras as checked bags, pillows and food, passengers have been struggling to know in advance the total cost of their tickets. Travelers, corporate travel managers, and travel agents are all frustrated that the fees are not disclosed through computer distribution systems and independent travel agencies that they use to compare airline fares. This growing concern over airline ancillary fees prompted an aviation subcommittee in the House of Representatives to hold hearings last week on the subject. The American Society of Travel Agents (ASTA), Interactive Travel Services Association (ITSA), Consumer Travel Alliance (CTA), and the Department of Transportation (DOT) were united in arguing that airlines should make these fees easier to find. Even the Government Accountability Office (GAO) was critical of the airlines, issuing a report to the committee calling for regulations to compel airlines to disclose ancillary service fees through all distribution channels. The agency also suggested that Congress consider taxing some or all of the airline fees. A representative of the Air Transport Association, representing the nation’s largest airlines, said most airline fee information can be found on the airlines' websites and that it’s up to the distribution systems to gather that information and provide it to consumers. According to a recent report by Amadeus and IdeaWorks, the 2009 airline ancillary revenue tidal wave increased a whopping 43% over 2008 with more carriers disclosing millions in fees, including new a la carte fees and commission-based services through their frequent flyer programs.
Source: Los Angeles Times, Business Travel News, Amadeus
Tarmac Delay Rule Creates Controversy
The Transportation Department's new rule banning lengthy airport tarmac delays is a mistake, according to a recently released study from two aviation consultants. The rule, which took effect April 29, requires airlines to let passengers off domestic flights when they've waited three hours on the tarmac. Violations of this rule could result in airline fines up to $27,000 per passenger. According to Joshua Marks of Marks Aviation and Darryl Jenkins of The Airline Zone, their study concludes that forcing flights with lengthy delays to return to a passenger terminal will tax the already congested gate resources and would result in additional flight cancellations, creating significant public harm. The DOT, however, disagrees, stating the study "offers a misleading and premature assessment of the impact of the new passenger protections." It further said the study is "far too narrow to yield defensible conclusions about future airline trends." The most recent government data — for May 2010 — show a reduction in tarmac delays greater than three hours, so the jury’s still out on this issue. The Government Accountability Office said it would need months of data before making any conclusions.
Source: USA Today
US Approves American/British Airways/Iberia Alliance
The US Transportation Department gave their final approval on the antitrust waiver for a transatlantic alliance between Oneworld members, American Airlines, British Airways and Iberia. Fellow Oneworld members Finnair and Royal Jordanian also received antitrust immunity from DOT. This new joint venture will allow these carriers to coordinate scheduling and pricing, while sharing revenue and costs on those routes. The DOT required that a limited number of landing slots at London’s Heathrow airport be surrendered to competitors in exchange for the joint venture approval. According to the DOT, the new arrangement will enable these Oneworld carriers to "compete more vigorously" with the Star Alliance and SkyTeam, alliances that already have immunized joint ventures for transatlantic routes. Also, the DOT said the Oneworld joint venture would benefit travelers with "lower fares in some markets, new nonstop routes, improved services and better schedules." Customers also will receive numerous benefits, including expanded opportunities to earn and redeem frequent flyer miles and elite tier benefits and continued reciprocal airport lounge access.
Source: American Airlines
Full-body Scanners to Be Plentiful by Year-end
About 450 full-body scanners will be used in airports nationwide by the end of the year, and 142 have already been installed in airports such as Boston, Dallas-Fort Worth, New York-JFK, San Francisco and Miami. The controversial machines are part of enhanced passenger screening to detect hidden weapons and liquid explosives. Passengers’ concerns over graphic images generated by the equipment have prompted federal authorities to take steps to assure anonymity. TSA officers viewing the images are located at remote locations and do not see or come in contact with the screened passenger. A privacy filter blurs the faces and privates of screened passengers, says the TSA, and the images are immediately and permanently deleted. Some critics have raised health concerns, but TSA officials said that the amount of radiation emitted from the machines is the equivalent of two minutes of flight aboard a jetliner. Passing through the equipment is optional. Passengers who opt out of the scan must submit to a physical pat down by a TSA officer, which slows their trek through security.
Source: WPXI-TV, Daily Breeze, Houston Chronicle
Secure Flight Program Matches 100% of Passengers Against Watchlist
Department of Homeland Security (DHS) Secretary Janet Napolitano announced this month that 100 percent of passengers traveling within the United States and its territories are now being checked against terrorist watchlists through the Transportation Security Administration's Secure Flight program—a major step in fulfilling a key 9/11 Commission recommendation. Under Secure Flight, TSA prescreens passenger name, date of birth and gender against government watchlists for domestic and international flights before a boarding pass is issued. The program also helps prevent the misidentification of passengers who have names similar to individuals on government watchlists. According to DHS, 99 percent of passengers will be cleared by Secure Flight to print boarding passes at home by providing, at time of booking, their date of birth, gender and name as it appears on the government ID they plan to use when traveling. Some airlines will not allow ticketing if the Secure Flight information is not included in the reservation data. Individuals found to match watchlist parameters will be subjected to secondary screening, a law enforcement interview or prohibition from boarding an aircraft, depending on the specific case. The TSA expects all international carriers with direct flights to the U.S. to begin using Secure Flight by the end of this year.
Source: TSA.gov
New In-flight Entertainment Takes To The Skies
According to Sky Guide e-Alert, airlines are trying out new options for in-flight entertainment in their never-ending quest to keep passengers entertained. Among the most recent:
- In Australia, Qantas subsidiary JetStar will begin loaning out Apple iPads to passengers on select flights. The devices will permit users to access the Internet, along with movies, TV programs, games, e-books and music for a fee of $8.40. Jetstar will expand the iPad rentals to more aircraft if the test program is successful.
- A U.K.-based provider of in-flight entertainment systems, IFE Services, is teaming up with Sony Computer Entertainment America to market Sony PlayStation Portable (PSP) units to airlines. It has signed agreements with six airlines so far. Passengers can use them not only for a variety of games but also to access movies and TV programming.
- United Airlines is overhauling its in-flight audio service. The airline said it is now working with Zune, Microsoft’s digital entertainment service, to provide new in-flight audio for all its aircraft. “In addition to familiar channels such as Classic Rock, Contemporary Pop and Classical, United now features distinctive options such as Soundtracks, Electronic Dance, Opera and Piano Jazz,” a spokesman said.
Azumano Travel Makes Travel Weekly Power List
Travel Weekly, a leading travel industry publication, named Azumano Travel to its 2010 Power List of the nation’s top-producing travel agencies. This year 52 agencies made the $100 million threshold for inclusion, down from 61 in 2009. The Power List is all about size and represents an effort to rank the nation’s top travel sellers in the terms of the total dollar volume of annual sales. Azumano Travel has been included in Travel Weekly’s ranking many times since it’s inception in 1992 as the Top 50 agency list; it later changed it name to to the Travel Weekly Power List.
Azumano was also recently ranked at number 15 nationally in the 2010 Business Travel Survey conducted by Business Travel News, an authority on corporate travel. This ranking of U.S. travel agencies is based solely on airline sales volume reported through the Airlines Reporting Corporation (ARC). Both publications are members of the Northstar Media group.
