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Posts with tag airline

Would you pay extra for no screaming children? Airlines rethink fees

Filed under: Travel

Long gone are the days in which you paid a price for an airline ticket, and got a decent seat and a meal. Seats have been getting crammed closer and closer together to maximize airline revenue, and for many fliers, you can't even get a drink of water with your airfare. Commonplace fees now include: checked baggage, all beverages, all snacks, better seats (like exit row with a little extra leg room or non-middle seat), and blankets.

Would you pay a fee for additional "perks" on your flight? (As if the above can actually be called perks!) WestJet is surveying its customers and asking that very question. They're considering a $10 fee for things like: priority boarding and exiting, expedited baggage delivery, in-flight internet access, in-seat electricity access, guaranteed space in an overhead bin, and faster clearance through security.

Then there's the "would you like your ticket reduced by $10" for these items: not checking bags, not earning frequent flier miles, taking only one small carry-on, sitting in a middle seat, no free beverages, sitting in a seat that doesn't recline, and sitting near babies and children.

Some of these items are compelling. How I would love to be guaranteed that I don't have to sit near children. In-flight internet and electricity would appeal to me as well. I think that in some ways, rethinking these things makes sense. An airplane isn't meant to be a hotel in the air. It's more like a bus in the air, and a million perks during the flight aren't necessary.

On the other hand, the "nickel and dime" method of flying seems to be doing nothing other than irritating fliers. Many that I talk to would rather just have the "fees" included in the original price of a ticket, rather than being slapped in the face with an extra charge each time they turn around.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

United Airlines to customers: Check your bag for $150

Filed under: Budgets, Extracurriculars, Transportation, Travel


When it's backed into a financial corner, what's an airline to do? Gas prices are saner now, but they won't give our money back for the fuel surcharges because now they're using that cash to plug mortal wounds. Americans have grudgingly accepted the implementation of luggage fees, too. As consumers, we've all been led down the primrose path with the airlines, and they're finding that we're actually pretty compliant when it comes to these extra charges.

So why not try out a hefty optional one? United Airlines has partnered with FedEx to sell passengers door-to-door overnight delivery of your luggage. FedEx retrieves your luggage from your house, preferably the day before your flight, and you pick it up the next day at your destination, such as a hotel or at a specified address. The one-way price deviates from the usual FedEx rate scheme: $149 for flights under 1,000 miles and $179 for longer flights. As always, without this splurge fee, your stuff can travel in the cargo hold just below your feet for $15 each way for the first bag and $50 each way for each second bag.

Marketing-wise, I'm not sure what the message is here. With this new optional charge, United seems to be tacitly acknowledging that you might be better off entrusting your valuables to someone else. Is United admitting that paying ten times the usual price is the only way to make sure your bag actually makes it to your destination? Like the cruise lines' efforts to offer premium restaurants on its ships, United seems to be saying that its usual service isn't good enough. And it's not like the lack of a bag will speed your passage through security in any meaningful way, because you can only move through it as quickly as the person in front of you.

Game the system: How to get your money back if an airfare drops after you buy your ticket

Filed under: Budgets, Extracurriculars, Technology, Transportation, Travel


So you buy an airfare at a ridiculous price -- or even a good one. And a week later, the airline decides it hasn't sold enough seats. Rather than fly an empty plane, which would cost it money, it slashes the prices on seats. Come the day of the flight, you turn to the person sitting next to you and learn, to your disgust, that they paid $200 less than you did.

What can you do? Well, by the time you're on the flight, often nothing. But if you discover you've paid more than you had to before you have used the ticket, you can usually petition the airline for the price difference. Usually, that refund comes in the form of a voucher that you use for future travel, but that's still money you don't have to spend later on.

But, surprise! Some airlines have a nasty trick up their sleeve. Many charge obscene change fees since, the way they see it, they have to pull your old ticket and issue a new one to give you the better price. That means that for domestic flights on U.S. Airways, Continental, and American, the price has to drop by more than $150 in order to give you an ultimate benefit. But plenty of other airlines don't charge any fee at all (JetBlue, Alaska, United), or their fee is small enough to give you pretty good chances (Northwest's is $50, AirTran's $75). The fees are usually steeper for international flights, but then again, the price drops stand to be higher for those, too.

After you book a flight, you could keep returning to the airlines' websites to double-check the rate status of your booked flights. That will work. But one of the lesser-known airline booking sites, Yapta, keeps tracking the price of the stuff you've bought, and if it descends past the point where you can actually make some money back, it alerts you by e-mail. (The site, like Hotwire's Trip Watcher and Farecast, will also keep an eye on rates for flights you haven't bought.) Every bit helps, right? Maybe the amount you save will pay for a pack of peanuts. Barely.

'Duh!' of the day: United loses $544 million betting on the fuel market

Filed under: Borrowing, Extracurriculars, Transportation, Travel, Recession, Bankruptcy


Hedging fuel costs sounds confusing, but it's nothing new. Some airlines, like the budget model Southwest, have managed to claim a profit in no small part because their masters were clever enough to buy most of its fuel when it was still sensibly priced. That can work out really well if gas prices go up, because those smart airlines will still be paying an older, lower price. Some experts think Southwest has saved $3.5 billion by doing this since the late '90s.

United Airlines, which has a management as sharp as a box of hammers and aging seating about as soft, thought it could imitate Southwest by getting into the hedging game, too. But, whoops! Timing is everything. It got in way too late, as the market prepared to peak. Prices went down. And right now it's paying almost $13 more a barrel than oil is actually worth, which could rack up as much as $544 million in boneheaded, unnecessary losses.

It's a lot like the guy down the street who bought his house a year ago for $400,000, only to find in this self-correcting market that it's now worth about $250,000, which everyone in the neighborhood knew was a more realistic price all along. He intended to flip it, but now he's got to live in it. Of course, if gas prices go back up a bit, United's loss may be mitigated slightly.

Get ready to BE the full 'freight' when you fly

Filed under: Transportation, Recession

airline servicePaying extra for your heavy bag to fly is one thing. Paying for your bag to fly at any weight is another thing. But paying by weight for people to fly? It's not such a crazy idea according to Bloomberg News, which says the industry is actually floating proposals like this as it tries to cope with rising costs, and it points out that Southwest already asks large people to purchase two seats.

Are you ready to fly as freight? You may have no choice as airlines are considering every possible option, according to an industry expert Bloomberg quotes. They'll do anything to avoid going out of business, as eight carriers already have this year, or having to ground flights, like United announced today.

What else is on Bloomberg's list of unusual measures already in practice or being considered?

  • Using lighter plates and silverware (Japan Airlines)
  • Flying slower (Southwest Air)
  • Cutting out water (Singapore Airlines)
  • Using generators on the ground (American)
  • Washing frequently (Deutsche Lufthansa)
The option of being nicer to customers, as Tracey Coenen floated the other day, doesn't seem to be on the table.

Million dollar airline lawsuit is not warranted

Filed under: Travel

I'm the first person to admit that airlines treat their passengers like crap. And it's getting worse and worse. The airlines are all racing to see who can lose more money, mostly related to ever-increasing fuel costs. The passengers are merely a nuisance. Heck, they don't even seem to care if you have to sit on a disgusting toilet seat for an hour or two during your flight. (Blech.)

The one most predictable part of air travel now is that the customer is not in charge. The airlines are, and customers better make arrangements to deal with them. There is no more last-minute dash to the airport. Being assured of a seat on a flight isn't possible anymore either, as airlines frequently overbook flights and you might be the person left behind.

I'm not blaming airline passengers for being upset. But a million dollar lawsuit against Delta Air Lines because you weren't allowed on a flight and it ruined your vacation? I don't think so.

Animals and Money: Hey desperate airlines, please gouge us dog owners

Filed under: Budgets, Transportation, Travel

The Airline industry is desperate. They've packed us in as tightly as they can, cut service and comfort to the bone marrow, crunched schedules and now they're charging for checking bags. (This week American announced it would charge $15 for its first checked bag. Last month American and other airlines announced they would charge $25 for the second checked bag.)

American also upped its fees for traveling pets. Just a few years ago they were $50. Now they're $100 each way in the cabin and $150 in the cargo hold, which is where dogs over 20 pounds have to go. But on behalf of dog owners everywhere, I'd like to say that all the major airlines are missing out on a huge new opportunity to gouge customers --- customers who would line up to pay exorbitant fees.

I'm talking about dog owners who would be willing to pay full-priced human fare to have a big dog fly safely in the cabin. The space of one seat could easily stack three or four crates. Hey, airlines executives and shareholders, are you getting excited yet? I'd eagerly pay hundreds of dollars extra. You could make me show up for a flight at 5 a.m. or 11 p.m. You could sit me in the middle seat in the last row behind a chatty family who reclines and between sales reps. You could offer up your most surly staff and flimsiest excuses for delays. And I'd still be thrilled if only I could get my 70-pound dog safely in a crate in the back of the cabin.

Airlines in danger of being wiped out?

Filed under: Travel

The airline industry is clearly in a crisis situation, thanks to the high oil prices. Several have filed bankruptcy. Others are talking about merging with others. All of them are hiking fees and fares, but it may not be enough to save them. How many airlines will be left standing in the next year or two? No one seems to know.

American Airlines is reportedly losing $3 million a day, and that can't go on indefinitely. Experts say that the industry just can't survive if oil is going to cost $120 per barrel. They say passengers won't pay the kinds of fares it would take to keep the airlines profitable with fuel that expensive. There is a certain amount of fuel that must be used in the airplanes currently flying, and that amount of fuel means flights can't be profitable.

Even mergers, which typically can help beat-up companies as they are able to collectively cut costs by eliminating duplicated jobs and services post-merger, might not help. And even though the concept of airlines losing money isn't a new one (haven't most of them been losing money for years on end?) they're now in a unique position: Most cost-cutting measures have been taken and there is little else to cut.

One bright spot on the horizon for air travelers?

Filed under: Transportation, Travel

I moan a lot about how poorly the airlines treat their customers. And with the addition of all sorts of fees for everything from a drink of water to bringing two suitcases on your trip, the race is on to see which airline can treat its customers worst.

UK company Thompson Solutions has created a better airline seat they call the "The Cozy Suite." I already know what you're thinking. First class doesn't need another perk on their trip. But these seats – believe it or not – are made specifically for coach travelers.

The key to comfort for these seats is their staggered design. Three people are no longer crammed directly next to each other. Each passenger is slightly in front of or behind the person next to them, giving the illusion of more room. The seats even add seating capacity to some flights (depending on the configuration the airline chooses) which should make them more appealing to airline management. If airlines choose the configuration that does not add capacity, the seats then end up being two-inches wider than a normal coach seat. Yahoo!!!

A lot of design time went into these seats, with the most important part of the process... watching passengers to see how they sat and slept while on flights. Wired reports that Delta is the first airline that will be using the seats. They're scheduled to install them in 100 airplanes used for transatlantic flights, beginning in 2010. I'm all in favor of anything that will offer some level of comfort on flights!

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

What more airline troubles mean for you, the consumer

Filed under: Transportation, Travel

The bad news for the airlines just keeps coming, doesn't it? Today, Delta announced a loss of over $6 billion for last quarter. Northwest announced a loss of over $4 billion for last quarter. And the two want to combine to make a double-digit billions per quarter loser of an airline.

Fuel costs are killing the airline industry, although I don't think many would disagree that for several years now, the management of most of the airlines has been sketchy. The airlines have simply had cost structures that made it hard to consistently make money.

As airlines go out of business, file for bankruptcy protection but continue operations, or try to combine to form more powerful companies, the consumers are the big losers. Never mind how much shareholders of the airlines stand to lose. Consumers are the ones who feel the direct pinch of airline industry problems.

Additional airline fees driving passengers crazy

Filed under: Travel

Does it feel like each day you hear a news story about another airline fee? Well it sure seems like it to me. Your airline ticket allows you to be hauled like cattle to your destination. Of course you only get hauled if you pay the ever-rising fuel surcharge. (Remember the days when the cost of your ticket actually included the fuel to get you there?)

Want to talk to a person to book your flight? Fee. Want to bring a couple of pieces of luggage on your trip? Fee. Want to eat or drink something? Fee. Want to be able to use a certain airport? Fee. Want to fly at a certain time of the day? Fee. Want to change your flight time? Fee. Want to blow your nose on the flight? Well, no fee for that just yet. (Oops. Didn't mean to give the airlines another idea!)

The latest fee is being implemented by U.S. Airways. Do you want a "better" seat? You will have to pay an extra $5. The fee is going to be charged starting May 7, and it will be for aisle or window seats in the first several rows in coach. So you're still crammed in a coach seat, but you're paying extra for being crammed at the front of the plane instead of the back.

I'm sorry, the additional fees for everything under the sun are driving me crazy. Soon the airlines will be charging an extra fee simply for the privilege of being able to buy an airline ticket from them. Imagine that... paying a fee so that you can have the opportunity to pay more fees. Marvelous!

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

Check your airline's financial health before buying a ticket

Filed under: Travel

With airlines filing for bankruptcy in rapid succession, it's hard to know what to do as a consumer. Each time you book a ticket, do you feel a bit of apprehension, wondering if you'll really get where you're going? If an airline isn't having money troubles, there are always weather and safety concerns to disrupt your flight.

So what can consumers do? Well it's important to know that when an airline stops flying, if you've paid with a credit card, you'll most likely get your money back. That alone should be incentive enough to pay for all airline tickets with a credit card. If you pay any other way, your chances of getting your money back decrease significantly.

But even if you get your money back, the inconvenience and cost of trying to find a new flight may be very painful. I don't want to be put in that position. So as silly as this sounds, I'm not booking an airline ticket to anywhere without checking the financial health of the airline first.

ATA Airlines customers left hanging

Filed under: Travel

If you've got a ticket to anywhere on ATA Airlines, you're going nowhere. The airline canceled all flights yesterday, and is essentially out of business for good. Most of the Indianapolis-based airline's flights were between Hawaii and a handful of west cost cities or Chicago Midway.

What do you do if you've got a ticket for an ATA flight? Use it as scrap paper, because that's about all it's worth. The airline is saying "too bad, so sad" to customers, who will be forced to buy tickets on other airlines if they want to complete their travels. If you paid for your ticket with a credit card, however, you have a pretty good chance of getting a refund. If you paid with cash or a check, don't count on getting much (if anything) after the airline is liquidated in bankruptcy.

ATA officials said they're trying to see if other airlines will help their (now screwed) customers. But I don't think much help will be coming. Rumor has it that Southwest Airlines might be honoring some of the tickets for flights that were codeshared, but the availability is sketchy. Other than that, about the best you can hope for is a small discount if ATA is able to get other airlines to agree. But I wouldn't even count on that, as the airlines are all struggling lately with the massive increases in fuel costs.

Skybus summer fares: Incredibly cheap, incredibly limited

Filed under: Transportation, Travel

Upstart discount airline Skybus is out with its incredibly cheap summer fares -- only problem for most of us is that the bulk of its flights originate from Columbus, Ohio and Greensboro, North Carolina and go to just 17 cities. It does offer a few non-stop flights from Boston to cities in Florida, however, and promises to add more cities soon.

But, oh, the deals! First of all, how bout $10 seats? The airline promises $10 tix (plus taxes and fees) to the first 10 buyers on every flight. Hence the rush this morning when it's June and July flights were just released for sale.

The regular fares are quite amazing too. I checked flights from Newburgh, New York to Greensboro in late March when we're contemplating a family vacation to North Carolina and saw the airline was offering flights for $55 a seat! Only problem is that there were no seats available on the days of our vacation.

If, like me, you're new to Skybus, first check out where Skybus flies. Then quickly see if you can snag one of the $10 fares for some point this summer. You may already be too late, but let us know here in the comments if you have any luck.

If you live in an area served by Skybus, you may want to sign up for the company's email alerts so you can jump on the cheap fares as soon as they become available. I'll be interested to know if these deals are as hard to obtain as frequent flyer seats to Cancun over Spring Break.

Worst on-time airlines for 2007

Filed under: Travel

The Department of Transportation, Aviation Consumer Protection Division has released its 2007 report on the airlines, called the Air Travel Consumer Report. I love to pick on the airlines. They make it so easy by providing us frowning faces, filthy airplanes, late flights, canceled connections, and non-existent comforts like food and leg room.

If you had to pick the bottom five airlines in on-time arrivals, which would they be? These are the big winners for 2007... Atlantic Southeast was the worst, with less than 65% on-time arrivals. Next were ComAir, US Airways, and American. Bringing up the rear of the rear is the fifth worst airline, Frontier.

I suppose no rant on airlines would be complete unless I mentioned a few of the top airlines. The best airline for on-time arrivals in 2007 was Hawaiian, with over 93% on-time. Next was Aloha with over 92% of flights on time. (Hmmm... makes me think I might need to go to Hawaii soon.) The number 3 airline was Southwest, but they only had 80% of flights on time. Disappointing to be so close to the top with such an unimpressive percentage.

Overall the airlines averaged just over 73% of flights arriving on time for the entire year. I hope you're not trying to make a connecting flight any time soon.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.