Posts filed under ‘Tony's thoughts’
CarryingOn didn’t say it, so hold off on the protests for any political correctness infractions, but in case you didn’t see it, this was reported today in the Sky News http://uk.finance.yahoo.com/news/airlines-charge-fat-passengers-more-014228613.html
Seemed a Dr. Bharat P Bhatta, writing in this month’s Journal of Revenue and Pricing Management, suggested it, and offered one of three formats for its deployment:
- Fare according to weight
- Base fare plus/minus an extra charge for heavier passengers
- Same fare if the passenger has an average weight, but discounted/extra fare for low/excess weight below/above a certain limit. This option results in three types of fares: high fares, average fares and low fares.
After reading the article, my mind was racing with blog post possibilities. But in this day of political correctness I was hesitant to tackle such a heavy topic. Some confidents warned, “Don’t chance it man, you must ignore the temptation to weigh in”, but throwing caution to the wind I replied “fat chance of that happening, I must engage”.
In my opinion, this one is a no brainer.
Aircraft fuel consumption is based in large part on the weight an airplane carries. The more weight the more fuel, ergo the more cost for the airline. So the rules of economics should hold here. You bring more weight you pay more and in fact, the airlines have already starting doing this with their checked bags policies, and now it’s time to get to the people.
But beyond the economics which are pretty easy to defend, there are other more personal reasons.
C’mon you know what I’m talking about, you’re just afraid to say it. How depressed do you get when you make you way to your seat and see a seat mate of size (was that the best PC way to say what I just said?).
The guy has put the arm rest up and given he is already encroaching halfway onto your real estate, there isn’t much you can do about it but slink your way in. It’s impossible to avoid contact, and after not too long you notice that the guy’s body seems to be throwing off the heat of a blast furnace, and you actually start to perspire three minutes into a four hour trip.
And that’s if you have an aisle and he has the middle, or heaven forbid you have the middle. What if you have the window and this guy is next to you and falls asleep? You’re now forced to refuse all requests to hydrate for fear you will have to climb mount fatso to get to the lav for some relief. Who among you can concentrate on email or your March Madness Picks when you’re thinking “I could be developing an embolism in my leg due to the lack of movement and fluids”. Now I ask you, is that any way to fly? No, of course it’s not and it’s time to take a stand! I say the airlines put a seat with two armrests right next to that thing that measures the size of your carry-on bag.
If Fatty Arbuckle can’t fit in the seat, he pays for two seats. Charge the guy a few extra bucks he might call Jenny Craig, and who knows maybe this becomes another way to deal with the obesity problem everyone claims we have here in America beyond another season of The Biggest Loser.
But this might make too much sense and will surely offend some, so I’m guessing this idea is destined to crash before takeoff.
I don’t want it to look like I’m picking on the TSA, but I can’t let these go without saying something….
Yesterday they missed a guy at JFK who had a stun gun in his bag (http://bit.ly/YdUSrI)
They eventually got him after his former girlfriend let the cops know he had stunned and then raped her repeatedly the night before. Bad guy caught but not without slipping through the TSA security checkpoint while trying to escape to London.
This while TSA Chief John Pistole was in Washington saying only an act of congress would prevent small knives from being allowed onboard (http://bit.ly/ZFuDaJ).
Ok, so a stun gun is not a small knife, but I’m not sure I’d be digging it on a position at this point if I’m Mr. Pistone.
In fact, this brings to mind the great scene towards the end of the original Rambo movie “First Blood”, when Colonel Trautman says to Rambo “IT’S OVER JOHNNY. IT’S OVER”.
If only it was!!
Ok CarryingOn fans if you’re still out there, I’d like to apologize for not being very active over the past few months. Chalk it off to a bunch of things we won’t go into here, but after observing the recent statements and actions of the TSA, even the Rip Van Winkle of bloggers would be stirred to life!!
It all started when I read that the sequestration forced budget cuts were going to cause chaos in air travel. It seems as if a 4% budget cut would result in everything from forced flight cancellations to reduce the workload on ATC staff, to dramatically longer security lines with a less secure environment to boot, and a quadrupling of the time it takes to clear customs at some of our bigger international gateways.
Homeland Security Secretary Janet Napolitano and TSA Chief John Pistole were the ringleaders of a clear effort that used hyperbole to create panic among the masses who use the air transportation system on a regular or irregular basis. They were quickly joined by a chorus of industry insiders and pundits who accepted their predicted outcomes without even the slightest pushback, and then decried the impact on the travel industry.
In fact, in the days after the sequestration started, Napolitano suggested that the lines had already begun to build (this despite the fact that not one screener has been let go, since the law requires that federal workers must be given 30 days notice before a furlough, but we digress from the chaos).
It’s all political theatre designed to scare us into thinking that what amounts to a rather insignificant budget cut, would mean the end of air travel as we know it.
We’ve written a few times about the TSA and like tracking them because of their entertainment factor (http://bit.ly/YxteVQ),
but for those of you who might not scrutinize them as closely as CarryingOn, here are a few of data points to consider:
• The TSA now employs 62,000 people, 47,000 of which are screeners, and has an annual budget of $8Billion.
• In 2007 some 680 million flyers were screened by what were then 44,000 screeners, but in 2011 only 640 million of us took to the skies, yet there were 47,000 screeners.
If you’re keeping score on that one, a 6.2% reduction in the number of people being screened seemed to require a 6.8% increase in the number of screeners. Now I don’t claim to be a TSA staffing specialist or to know all the complexities of what the TSA does, but I did do a two year stretch at LGA Airport a few years back, when the airline was still responsible for the screening checkpoint (we hired sub-contractors), and I seem to remember that if we had less people coming through the place, we needed less people to handle them. Who knows, maybe the shoes in the bin part causes you to need more people.
The TSA has also said that the only way to manage the required cuts is by reducing staff. Obviously that’s one way to do this, but surely not the only way. Maybe they can cut something else. Like what you ask? To answer that, it’s time for some more TSA fun facts, these provided by a joint report by the House Transportation and Infrastructure Committee and the Committee on Oversight of Government Reform, which showed that among other things:
• The TSA has a warehouse in Dallas, Texas, where 5,700 pieces of unused security equipment sit in storage. The dormant equipment is worth $184 million.
• This equipment storage cost taxpayers another $23 million in depreciation, because nearly all of the 472 carry-on baggage screening machines in the warehouse have been sitting there unused for over nine months.
• The agency spends another $3.5 million every year just to lease and manage this warehouse.
In addition, under the recently renewed labor agreement, TSA employees will see their uniform allowances nearly double to $446 per year (by comparison, a combat Marine Lieutenant receives a one-time uniform allowance of $400). The cost of the increase in TSA uniform allowance is an estimated $9.63 million annually.
If we total this stuff up you could lop $220 million off the budget, which represents close to 3/4th of the required cuts, and not one TSA head was touched in the process! And I’m guessing they could find another $100 million to get to the required 4% reduction without too much difficulty.
But I guess I shouldn’t be too hard on the TSA because they are relaxing the restriction against carrying pocket knives, billiard cues, and a host of other items that make absolutely no sense being onboard.
So while it might take more time to get through security, once onboard at least I can go back to my favorite thing to do on a long transcon flight, whittling wood. I can see it now…..”Hey, look there’s Minnesota Fats in 32C . I’m going over and introduce myself and see if I can trade him my wood carving of Janet Napolitano’s head in return for some tips on how to play a better game of 9 Ball.”
An article in yesterday’s New York Post referenced a research report conducted by Airfare Watchdog.com. Now before I go further in describing the report’s findings, I feel it fair to add that Airfare Watchdog.com is not some government agency or non-profit that is tracking airfares for empirical reasons or to monitor injustice in the world of airline pricing. Rather, it is a cleverly named OTA. But hey, they have passengers and asked 1,000 of them some questions and then turned the answers into a research report that got noticed by CarryingOn and probably many others, so good for them.
Putting the source of the research aside for the moment, I thought it would be fun to conjure up what would happen if airlines actually starting selling this service. If as suggested in the survey, 1 in 6 travelers would be willing to pay more to exit the plane faster (10% said they would pay $10, 3% would pay $20, and another 3% an unspecified amount), the US Airlines would generate over $790Million annually in ancillary revenue. That’s a lot of dough and almost as much as the US Government will save under ObamaCare in one year (I’m sure some of you can sense the skepticism in that analogy, but I couldn’t help myself having just celebrated our country’s Independence Day).
But before the industry starts debating whether this new GOF Fare (Get Off First, because we do love our acronyms) can be sold in the GDS’s, let’s consider a few things. Having often wondered how I would fare in the fictitious Olympic event “Airport Steeplechase” as I dodged, weaved, and sprinted from Gate B27 to Gate E3 to make a connection, I asked myself if I would have paid an extra $10 bucks to get a head start. Given I’ve missed my fair share of connections, and been put through the “reaccomodation” process, a process by the way, that I liken to being paroled from prison, I would pay the $10.
Now before you say “no way I would pay”, reflect a bit on your worst missed connection and the likely reaccomodation process you encountered….
”Sir, you will have to wait your turn, all these other people in front of you also need our help”, which was followed by,
“Sir, we are working as fast as we can…you will simply have to wait your turn”, only eventually to hear an hour later,
“Sir, I’m sorry but the only thing we have for you is a connection tomorrow morning, and no, there are no hotel rooms available in the area”.
So you would probably pay the $10 too, but before our airline friends start salivating at the prospects of all that new revenue, they might want to consider the practical aspects as well. In previous posts we’ve talked about the boarding process and how complicated and unruly it has become, but in the case of getting on a plane at least you have referees (in the form of gate agents), a bigger playing field (the boarding area), and some easily identified rules (your boarding pass for one), that help control the process somewhat.
Now envision yourself onboard a packed 757 and having paid the $10 to get sprung from jail (aka the middle seat in Row 38) faster. Now think about an announcement that goes something like this, “ladies and gentleman, certain individuals onboard have paid for the privilege or exiting first, so I would like the rest of you to sit in your seats while they do that.” I envision everything from looks of confusion, to stares of hatred, followed by a host of people who didn’t listen, barely understand English, or choose to ignore the announcement, getting up and into their overhead retrieval routine, thus impeding your sprint to the exit. And what if you don’t end up getting off first after having paid for the privilege? Is your money refunded? Is there an arbitrator that rules on such things (“sir, you might not have been first per se, but you were in the first “wave” to exit, so technically we complied with the rules of carriage as outlined by IATA, ARC, the DOJ, EU, and Kevin Mitchell”). I can just see the mayhem in the aisles, the Tweets on Twitter, and the status changes on Facebook to something like “still in line”, or “just ripped off by the airlines”.
As a result, to save the airlines and everyone else a lot of trouble, CarryingOn is going to recommend a quick death to this idea, because if you really want to get out of a plane before everyone else you can do it today and it works just fine. After all, it’s not called First class for nothing :-).
As a follow-up to our last post, looks like the FAA is going to take the lead on updating the rules with respect to the use of electronic devices in-flight.
Being as thorough as they are, they plan to bring together manufacturers, consumer electronic associations, aircraft and avionic manufacturers, airlines, pilots, flight attendants and passengers, but, and this is a BIG but, they have yet to secure funding for the project.
CarryingOn therefore expects we’ll get a definitive ruling at some point in 2018, or a full year after Mariano Rivera is enshrined unanimously on the first ballot to the Baseball Hall of Fame.
Actually, I’m thinking Mo will be introducing Derek Jeter to the Hall in 2019 before you’ll know for sure if you can turn on your iPad and watch the induction ceremony from 35,000 feet.
After a 7+year run, I’ve decided to leave Rearden Commerce effective at year’s end.
It’s been a great ride….one that saw us grow from not even having a Travel application or a distributor of any kind, and when we could fit all our customers into my 1978 Cadillac, to where we stand today….over 7,000 customers, 50+ Travel Management Company Partners, processing over 14 Million transactions annually, and being a recognized, well respected brand, and leader in the space.
I was blessed to have the help of a fabulous team of co-workers, along with the support of our partners, customers, and my many industry contacts and friends, and I sincerely thank you all for helping with my success.
Never fear, CarryingOn will continue to carry on with me at the helm, backed by occasional guest bloggers—including some of those you’ve come to know and love on this blog. You might also start to hear from the Carrying On bloggers on Rearden Commerce’s Deem Blog. I want to thank my partner in almost crime Mike D, and the Rearden Marketing folks behind the scene: Brent Cohler, Alicia diVittorio, Yoni Meron, and Allison Jeannotte, for helping get it started and for giving me the inspiration to post on a regularly basis (some would call what Allison does nagging, but it’s all good and without her you might not see another post for months ).
I’ll be taking a short break primarily to get my bowling game back in order, but will also be looking for my next opportunity and challenge, so I’m sure I’ll see you all out there very shortly.
Until then, I wish you all the best.
I read with interest a recent article suggesting that the European Union was about to start making foreign airlines pay for their carbon emissions. The program has been widely criticized by many including the Air Transport Association, and the International Air Transport Association, which represents 230 airline across the globe, for many reasons as you will read in the piece.
Now putting the scientific discussion of the impact of carbon emissions aside for a moment, I don’t think anyone would disagree that air transportation is a significant driver of the world’s economy, and beyond the economic impact, has changed the world for the better. But for as much good as it does, air transportation is one of the most heavily regulated and taxed industries, and this new regulation is yet another example. EU officials admit as much and recognize that this program will ultimately cost consumers more (as much as $16US per long-haul flight, according to The New York Times), but they simply suggest the airline pass the cost of their emissions off on passengers, as they do with fuel price increases.
Now anytime CarryingOn hears the word “price increase” we get concerned, but the whole carbon emissions issue really came home for me this past week.
I was flying to MSP on Delta 2119, an 810am departure from LGA. The flight was full, the boarding typical for New York, with lots of crowding and a few “we haven’t called your group yet” boarding infractions, but was otherwise routine. Having logged a few miles in my day, I’m usually not that interested when the various in-flight announcement are made, not because they aren’t important, rather because I know most of them by heart, but on this particular day they caught my attention. Our MD88 aircraft was piloted by Captain William J. Botella, who during his normal announcements also made some very interesting comments that made me think of the EU carbon emission story I had read a few days earlier.
What Captain Botella said was the following:
The MD88 with 130 passengers, would use 2,730 gallons of fuel over the 1,200 mile trip between LGA and MSP.
By contrast, to carry 130 passengers in automobiles (assuming 2 per car, and a 20 Miles Per Gallon vehicle), would consume 3,900 gallons of fuel.
So by flying, we saved 1,170 gallons of fuel, not to mention that we all got there in 2½ hours versus the 20 hours it would have taken had we driven non-stop at 60 MPH (and that doesn’t include a few Waffle Houses stops we would inevitably make along the way). And the good Captain didn’t even talk about any cargo that might have been onboard, cargo that otherwise would have been on trucks that burn even more fuel.
His comments got me thinking that maybe this air transportation thing isn’t so bad for carbon emissions after all, particularly when you look at it as Captain Botella suggested. Sure, you can take the position that any carbon emission is bad (and again science aside), but does anybody really think we can stop emissions altogether? The answer is no, but in this case maybe there is a different perspective we should take. One that considers the alternative, because I don’t know about you but one thing I don’t think we need is another tax on our industry, so I’ll close by quoting the old Beatle classic Taxman, which if you don’t remember went like this:
If you drive a car, I’ll tax the street,
If you try to sit, I’ll tax your seat.
If you get too cold I’ll tax the heat,
If you take a walk, I’ll tax your feet.
… and will add my own new verse to help shed some light on this one as only CarryingOn can.
If you fly today, I’ll tax the ride.
If you will not pay, you’ll have to drive.
If you drive your car, the fumes will flow,
Even more than if you flew you know.
Feel free to sing along, and maybe we all karaoke it with our favorite Congressman.
Research organization Gartner, Inc. made some very interesting predictions relative to IT for 2012 and beyond. Check out the complete list of prophecies here. But what struck a chord with me was the overall tone of the report — which suggested the continuing influence of the consumer/end user, and the power that impact will have on influencing IT Managers. This pull-out gives you the gist:
“The continued trends toward consumerization and cloud computing highlight the movement of certain former IT responsibilities into the hands of others … As users take more control of the devices they will use, business managers are taking more control of the budgets IT organizations have watched shift over the last few years. As the world of IT moves forward, CIOs are finding that they must coordinate their activities in a much wider scope than they once controlled. While this might be a difficult prospect for IT departments, they must now adapt or be swept aside.”
CarryingOn has talked about this trend towards consumerization in business travel in the past, and if we extrapolate some of the predictions Gartner is making, it sounds like the days of corporate mandates could be ending. Ponder for a minute: just a couple years ago, would you have envisioned your company not only supporting multiple operating systems, but allowing employees to select which devices and applications they use at work, or to store their data in “the cloud”? (Your 2009 self would likely be confused by the “cloud” and you would also have no idea the impact that Apple would soon have on your life.) It used to be: you started at a company and they provisioned you a desktop or PC, in some cases a smart phone, and in just about 100% of the cases, provided you access to the company’s “network,” a highly guarded environment that was vetted by security, sourced by procurement, maintained by operations, and used by 100% of the employees. Today, it’s becoming an entirely different ballgame.
The New York Times recently reported on the consumerization of IT: “[Corporate IT departments] are now in retreat. Employees are bringing in the technology they use at home and demanding the IT department accommodate them. The IT department often complies.” The Times reports that Forrester Research found that 48 percent of information workers buy smartphones for work “without considering what their IT department supports.” Apparently, flexibility = productivity. So, let’s extrapolate these trends to travel.
The fact is, the Managed Travel program has always been “challenged” by the end user. In the good old days before the web, it was fairly common to hear an employee say (and many times that employee was a “C”-Level type), that they had a friend “in the business”, aka, a local Travel Agent that they had dealt with for years, and they often avoided the company mandated TMC. Today, it’s “I found a better deal on the web,” but the point is that when it came to Travel, there has always seemed to be more of a willingness to challenge the company program in some way.
Today, technology innovation has created a more informed and demanding end user whose experience in their personal life shapes their expectations at work. They proudly suggest they can find something better, because they feel only they know what they want, need, like, or all of the above. And, on some levels, they are probably right. We’ve heard of entire Travel programs where the end user is given great latitude in making decisions, and in general there seems to be a trend towards accommodation that cannot be ignored.
The trends all point to a need to re-think some of the basics of your program to ensure the decisions you are making, especially those related to the technology you put in a users hands (think online tool and mobile travel application), need to be informed by what the end user thinks is best for them. Ignore the trend and face the potential wrath of a more informed and empowered employee. Remember, Business Travel is not their end game; it’s a means to a greater end. How they do it matters. How you build your program to accommodate for that matters as well.
Tony D. first redefined “logical” when he recycled old newspapers by reselling them at the local junkyard. Today, TheBeat.Travel features TD’s latest challenge of all things logical. “Travel managers are missing the mark!,” he shouts, insisting that the definition of “Lowest Logical Airfare” must change forever. Today’s travel managers must expand their definition of “logical” beyond price, scheduling and corporate discounts — to benefit both business travelers and their organizations. Let’s be real: companies that keep their road warriors happy with in-flight wi-fi and priority boarding have more productive business travelers, at minimal incremental cost. Read more here, then please answer for us: what is the most logical way to help your business travelers succeed? And if I may quote Tony: “Soldier On, Travelers.”
I’m not sure if you caught the CNN article, but a number of airlines are checking out alternative fuel sources such as algae and cooking oil — and it struck me as intriguing. I’m all for anything that can reduce the general dependency on oil, given the dramatic impact it has on the Travel industry, but it sounds like we have a ways to go here before we should start getting too excited. The cost for alternative fuel sources is still somewhat prohibitive, but what CNN identifies as just as challenging is that there is no “supply chain” for these alternative fuel sources. So even if the industry can figure out how to get all the kinks out, they’ll still have a pretty big hurdle: there is no efficient way to get the product from producer to consumer.
That got me to thinking about a topic I’ve blogged about in the past, namely the concept of a T&E Supply Chain. In case you don’t want to hit the link and read the post, according to Wikipedia a supply chain is “a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer.” Think about yours, and when you consider game-changers like fragmenting content, new sources of distribution and payment (think Mobile), and new players and processes (think Daily Offers, Gamification, and Social Networking), ask the question “What will our new T&E Supply Chain look like in a year or two?” Which of these new processes or platforms are most likely to stick and become part of the new Travel Program? Which will attract users, and which will become distractions that fall by the wayside? Attraction or Distraction? That is the question, when thinking about your new T&E Supply Chain.
Alaska Air is now testing alternative fuels, running test flights powered by cooking oil, which the airline claims is reducing CO2 emissions by 10 percent. Meanwhile, that fuel costs six times as much as conventional jet fuel. (It simply is not cheap to filter the fried bits out of cooking oil before reclaiming it to power a jet.) I see the attraction of trying to reduce carbon emissions from a corporate social responsibility perspective, but I fall down on the side of distraction on this one due to supply chain issues … because the idea of running a plane on fryolator grease is worthless until McDonald’s makes their drive thrus big enough to accommodate a 757. So the next time you are considering the latest and greatest idea, ask yourself – attraction or distraction?