Here's Your Free Ticket ... 50 Bucks Please

We have commenced upon another slippery slope.

Delta said it will ding customers $25 for frequent flier award tickets in North America and $50 for international award tickets starting Aug. 15. Delta calls it a "fuel surcharge."

Here's Delta's press release announcing the new charges for formerly free tickets. Note that it is headlined "Delta Continues to Adjust to Unprecedented Fuel Costs with Addition of Fuel Surcharge on SkyMiles Award Ticket Travel."

On June 12, US Airways made a similar announcement about charging $50 ($100 internationally) for award tickets.

The headline on its press release was: "US Airways Accelerates Business Model Transformation."

Hmmmm. "Continues to Adjust...with Addition" ... "Accelerates Business Model..." All these forward-sounding words!

Let me ask a question: Who the hell do these airlines think they're kidding? Why do they find it impossible to simply come out and say what they're doing in a straightforward manner?

I can't tell you the number of business travelers I have heard from lately who say: I wish the airlines would cut the crap, raise their fares to whatever it takes to stay in business, and stop nickel-and-diming us and insulting our intelligence. The leisure travel market is about to shrink substantially, and it's probably a really, really bad time to keep pissing off business travelers.

Hey airlines: Continue to adjust. To this.

###

Uh Oh (Cont'd): United Drops Some International Routes

Is that other shoe dropping?

United Airlines says it is killing a few international flights in the fall, including San Francisco-Taipei and Chicago-Mexico City, and reducing its Chicago-Tokyo flights to one a day from two.

Northwest Airlines, as noted here yesterday, also cut a few international routes, citing fuel costs and (uh-oh) sagging demand.

Most domestic network airlines are heavily invested in international travel, even as they slash domestic capacity. The thinking has been that international markets will hold up.

Place your bets, ladies and gentlemen.

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Show Us Your Books: DOT Denies Virgin America Request to Conceal Operating Data

The Department of Transportation denied Virgin America’s strange request to be allowed to withhold from public disclosure the financial and operating data that airlines are required to submit to the government.

Competing airlines objected strongly to Virgin America’s request to be able to conceal its balance sheet, cash-flow position, and a list of other data, including traffic and passenger origin-destination information. Virgin America had asserted that public release of the data would cause “substantial competitive harm.”

Virgin America began flying last August to good reviews, but it has not been clear whether the start-up carrier’s load factors, especially in coach, were holding up.

Here’s a copy of the Transportation Department’s denial, issued late this afternoon, of Virgin America’s request:

dot-virgin-america.pdf

###

Northwest Drops Some International Routes, Citing Sagging Demand

Uh-oh.

The major domestic airlines -- more heavily invested than ever in international routes at the expense of domestic capacity -- have been extremely worried that international traffic might begin to sag as oil prices keep rising.

Is the other shoe dropping? This afternoon, Northwest said it was canceling two transatlantic flights and suspending another in its joint venture with KLM, a division of Air France-KLM.

"Decreased customer demand" was one of two reasons cited.

Here's the announcement, which I guarantee you received serious attention at Delta and among other major airlines that have bet the farm on international travel:

EAGAN, Minn.-- Northwest Airlines, with its trans-Atlantic joint venture partner KLM Royal Dutch Airlines, today announced a seasonal suspension of flights between Minneapolis/St. Paul-Paris and cancellation of flights between Detroit-Dusseldorf and Hartford-Amsterdam – effective October 1, 2008.

With oil reaching a record-breaking $140 a barrel today, the reductions come in response to soaring fuel costs and decreased customer demand. Customers with advance bookings for these flights will be offered alternate NWA or SkyTeam alliance flight re-accommodations.

Selective frequency reductions and aircraft type changes may also be implemented on additional trans-Atlantic flights, depending on oil prices and ongoing customer demand.

Seasonal Suspension

Minneapolis/St. Paul – Paris

Destination		Flight Number		Departs		Arrives		Effective Date of Suspension
Paris		NW 62 / KL 6062		3:45 p.m.		7:20 a.m. +1		October 1, 2008
Minneapolis/ St. Paul		NW 61 / KL 6061		12:50		3:25 p.m.		October 2, 2008

Flights will resume between Minneapolis/St. Paul and Paris on March 28, 2009.

Cancellations

Detroit – Dusseldorf

Destination		Flight Number		Departs		Arrives		Effective Date of Cancellation
Dusseldorf		NW 94 / KL 6094		9:45 p.m.		11:45 a.m. +1		October 1, 2008
Detroit		NW 93 / KL 6093		1:15 p.m.		4:15 p.m.		October 2, 2008

Hartford – Amsterdam

Destination		Flight number		Departs		Arrives		Effective Date of Cancellation
Amsterdam		NW 98 / KL 6098		5:25 p.m.		6:40 a.m. + 1		October 1, 2008
Hartford, CT		NW 97 / KL 6097		1:25 p.m.		3:25 p.m.		October 2, 2008

###

American Airlines: Buh-Bye Albany, Providence, Harrisburg

More details today from American Airlines on the fourth-quarter capacity and route reductions that will leave the carrier with about 12 percent fewer domestic seats this fall that last.

American says it will eliminate all of its service, flown by American Eagle, in Albany, N.Y., Providence, R.I., and Harrisburg, Pa. It will also reduce service at LaGuardia, and in Chicago, Dallas and St. Louis.

Here's the announcement from American:

FORT WORTH, Texas – American Airlines and its regional affiliate, American Eagle, today announced additional details of their capacity reductions for the fourth quarter of 2008. The reductions are in line with American’s previously announced (May 21) plans of cutting fourth quarter domestic capacity by 11 to 12 percent and regional affiliate capacity by 10 to 11 percent versus fourth quarter 2007 levels. The changes are being instituted to reduce costs and create a more sustainable supply-and-demand balance in today’s high fuel-cost environment.

Today’s announced reductions involve additional schedule changes taking effect in November. Previously announced (May 27) reductions will take effect in September.

American is reducing flights at most of its principal operations. This announcement, combined with the previously announced round of schedule reductions, means American will close its operations entirely at three of its airports, while Eagle will close five of its airports, out of a combined total of 250 airports for both. The airports/cities being closed are:

--American: Oakland, Calif. (previously announced); London Stansted (previously announced); and Barranquilla, Colombia

--American Eagle: Albany, N.Y.; Providence, R.I.; Harrisburg, Pa.; Samana, Dominican Republic (previously announced); and San Luis Obispo, Calif. American Eagle will also close its maintenance base in San Luis Obispo.

American plans to reduce its departures in Chicago by 28 flights with American Eagle reducing 34 departures. In St. Louis, American will reduce departures by 8 flights with American Eagle and AmericanConnection reducing 35 departures. American will reduce 19 departures at Dallas/Fort Worth along with 23 American Eagle flight reductions.

The company also has decided to eliminate five AA flights and 37 American Eagle jet departures at LaGuardia Airport. In addition to the expected cost savings, these changes, coupled with appropriate government action, could allow the airport to operate with less chronic disruption and improve customer experience at one of the nation’s most congested airports.

“Today, the dependability and delay issues that exist at LaGuardia have reached a crisis point and have a daily negative impact on the overall customer service and performance for every airline with flights at LaGuardia,” said Bob Reding, American’s Executive Vice President – Operations.

Historical data from the Bureau of Transportation Statistics on operational performance at LaGuardia highlights the issues. During the last five years, for example, delays at LaGuardia have increased 50 percent and now occur on one out of every four departures, with these delays averaging more than one hour. In large part, these delays are attributable to Air Traffic Control’s inability to handle the scheduled service levels.

Likewise, inbound delays have increased by 55 percent and occur on four out of every 10 arrivals, on average delaying arrivals by 60 minutes. In addition, cancellations at the airport now average over 5 percent, an increase of more than 50 percent.

American has called for the FAA and the Department of Transportation to reduce the number of operations allowed at LaGuardia by 20 percent – or approximately 15 operations per hour until FAA airspace redesign efforts, ATC modernization, and other steps increase the level at which LaGuardia can operate reliably.

“As airport utilization increases, on-time arrival performance at any airport declines,” Reding said. “The decline is particularly evident as airport utilization exceeds 80 percent. LaGuardia is scheduled at over 100 percent and has the worst dependability in the nation. With the retirement of American’s five operations per hour at LaGuardia, the DOT will be able to achieve more than one-third of the objective, and will be well on its way to providing a real solution to the operational problems plaguing LaGuardia today.”

American and American Eagle regret the potential impact these schedule changes will have on its people. The company is in the process of determining the overall impact on its employees, and it is the company’s intent to offer voluntary programs before moving to involuntary separations.

###

Repent!

Above: The Reverends Al Sharpton and Pat Robertson at the reception area, the first sight you beyond the Gates of Hell. (The ocean background is, of course, a cruel mirage.)

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They Kill Horses, Don't They? ( But Who's Counting?)

The national disgrace that is modern thoroughbred racing continues without much further media disruption, now that the ... uh, unpleasantries that marked the Kentucky Derby are forgotten.

Yesterday, two more horses were killed after injuries in separate races at Churchill Downs, site of the Derby. The sportswriters, waiting for the next tray of shrimp to be brought to the press box buffet, like to say that such horses are "euthanized," as if a kindness had been bestowed upon them.

The Courier-Journal newspaper in Louisville doesn't give much play to these things, but at least it does cover them when they occur literally on the home turf.

The term the sportswriters like to use for "horses killed for sport" is "fatal breakdowns."

So far this year during the 41 days of the spring meet, six horses have been killed at Churchill Downs, which is by no means the only race track where these atrocities occur regularly. Last year, during 73 days of racing, 17 horses were killed at Churchill Downs, and in 2006 (during 78 racing days), 18 horses suffered these "fatal breakdowns," as the Courier-Journal says.

That's just one race track. And that also tells you almost nothing about what goes on at the track when the crowds are not watching in thoroughbred racing, the so-called sport of champions.

The Associated Press, in a recent survey, found that U.S. thoroughbred tracks averaged more than three horse deaths a day last year and reported 5,000 deaths since 2003 -- and that's based on incomplete numbers, since some tracks didn't cooperate. The excellent AP story reporting the survey results last week was widely ignored by the media.

Nothing wrong with racing a soundly bred, full-grown horse under humane circumstances, as I have said. None of those modifiers apply to modern thoroughbred racing.

Horses love to run like hell, to a degree. If you ask me a quarter-mile is a good distance to gallop a horse. But then I'm a fan of quarter-horses, called that because after a quarter-mile or so of rip-ass galloping, they're likely to give you a look that essentially says, "If you want to keep running flat-out like this, Bucko, get the hell off my back and run along yourself, then."

On the other hand, I was once on an endurance-trained Arabian mare in Houston that willingly galloped in a small pack for three miles -- and when I say "willingly," I inferred that from the horse's disinclination to drop down to a nice sensible trot after two miles, despite my desperate pleading.

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Airlines Take Aim at Transportation Department

I’m glad to see the Air Transport Association of America, the industry trade organization for the leading U.S. airlines, taking aim at elements of the sorry legacy of the U.S. Transportation Department and the F.A.A. for its dereliction of duty in managing the nation’s air-traffic control system.

This week, the ATA president, James C. May, testified before the House Committee on Transportation on the need to increase capacity and reduce congestion in New York-area airspace. ATA denounced the Department of Transportation (DOT) congestion pricing and slot auction proposals that would ration capacity. The DOT, said the airline trade group, needs to “to stop talking ideology and experiments, and start leaving a legacy that will help, not hurt, this country.”

“Instead of moving forward with capacity enhancements and airspace redesign using every available resource with all deliberate speed, the DOT is pushing congestion pricing and slot auctions – completely unproven textbook experiments that no one in the aviation world has used successfully,” May said. “DOT seems intent on leaving a legacy of failed, but extremely costly, experiments that do nothing to reduce congestion and flight delays in New York or anywhere else.”

Ouch. And it’s about time the airlines started hammering the DOT for its manifest failures in air traffic control modernization – marked by breathtaking cost overruns and delays, by betting the farm on questionable technology that still won’t be in place for years, and by consistently coming up with lame publicity stunts like those risible borrowed-from-the-military sky lanes at Thanksgiving.

The ATA is supported by the Port Authority of New York and New Jersey in opposing the DOT proposals on congestion pricing and slot auctions.

The ATA, obviously, represents the interests of the commercial airline industry. Its position here is strictly in regard to slot auctions and air-capacity reductions, incidentally. Others, including low-cost airlines and foreign airlines that might want to buy those auctioned slots, will disagree.

May’s testimony (transcript here) is worth a read for anyone who wants to keep up with the dynamics of the air-space allocation issues, and where the major airlines stand.

###

Good Times, Bad Times

Two items tonight illustrate the growing upstairs-downstairs separation in air transportation:


NetJets in $1.9 Billion Deal for New Gulfstreams

The business-jet leader NetJets said it will significantly expand its fleet of large-cabin Gulfstream G450s and Gulfstream G550s. In deal Gulfstream valued at $1.9 billion, NetJets will acquire 40 new Gulfstream jets - four Gulfstream G450s and four Gulfstream G550s to be delivered each year from 2012 through 2016.

NetJets has over 90% of the long-range cabin fractional-share market and is the largest operator of Gulfstream aircraft. NetJets’ worldwide Gulfstream fleet currently totals 110 -- with 21 Gulfstream G550/V; 55 Gulfstream G450/400/IV-SP and 34 Gulfstream G200s.

***

Boeing, Airbus Order Books 'At Risk'

Analysts estimate that 25-30% of the commercial aircraft backlog at Boeing and Airbus could be at risk as high fuel prices continue to batter airlines, Aviation Week reports in an article by Joseph C. Anselmo online today at http://aviationweek.com/aw/ and in Aviation Week & Space Technology's June 23 issue.

Many undercapitalized startups in Asia and Europe have overly aggressive growth plans that could cause the airlines to cancel or defer orders, Aviation Week reports. Robert Stallard, a director at Macquarie Capital, said, "The question that has yet to be answered is not whether there will be a downturn, but how bad it will be."

The article suggests two possible outcomes: the optimistic view that "Boeing and Airbus can afford to lose orders and still make it to the industry's next up-cycle with minimal pain;" and the more negative answer "that a steep change in global energy demand has created a permanent era of high prices and sent the airline industry into uncharted territory."

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Who You Callin' Cowboy, Cowboy?

My driver's license now says "Arizona" on it, which gives me even more cause to protest -- once again -- this continuing use of the word "cowboy" as a pejorative.

It's bad enough when they call George Bush a cowboy and mean it as an insult. It's a well known fact, as I have pointed out before, that the current president is not only unable to ride a horse, but is actively afraid of them. Plus have a look for yourself and see how much W behaves in a cowboylike manner, at least according to ol' Gene Autry, as quoted here in the Cowboy Code blog.

Now we have Arizona's own Sen. John McCain deriding the alleged "cowboy diplomacy" of Sen. Barack Obama. (Link via the breathless Drudge, who is not a cowboy, neither, despite his hat.)

Read Gene Autry's famed "Cowboy Code" and you'll see there's no reason for any sensible person to take offense at being called one.

In fairness, Sen. McCain, a former Navy bomber pilot, lives near spiritually chi-chi Sedona, Arizona, in an 8,300 square-foot house that the media hilariously refers to as "rustic," on 6.6 acres that the media equally hilariously refers to as a "ranch."

Sen. McCain is married to a rich beer distributor -- which, come to think of it, is a naval aviator's dream, not to mention a cowboy's.

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Can They Spell 'A-n-t-i-t-r-u-s-t?'

…They can spell it, but some observers don’t seem to grasp the historical concept in their eagerness to swallow everything the airlines tell them these days.

Way back in April, the tone was set for what is now developing when the Transportation Department announced a six-way antitrust-immunity deal for Northwest and its SkyTeam partners — Delta, Air France, KLM (Air France and KLM are owned by the same company, incidentally), Alitalia (stop that snickering right now!) and CSA Czech Airlines.

This wonderful gift was modeled on an exemption Northwest got from antitrust law in an alliance with KLM 10 years ago, followed by a similar deal Delta got from the feds in an alliance with Air France this year.

Dunno, I’m just a simple reporter who probably spends way too much time in the desert, but I seem to recall that antitrust law, as applied to airlines, essentially prevents them from colluding, especially in the matter of setting prices. International alliances have always operated in a kind of legal gray area in price fixing. But don’t forget, with Open Skies, the borders between international and domestic markets are disappearing.

And today we have word of still a new antitrust-law exemption — the new so-called “alliance” between United and Continental. Continental will join the Star Alliance, yada, yada, yada. All subject to (expected) approval from the feds. No downside at all, the experts proclaim.

O.K., you can call these things “marketing alliances” if you want, as if they’re just more of the same. But I call them quasi-mergers on select routes. And the key component of all these wondrous new partnerships, and the anti-trust exemptions that accompany them, is that the involved airlines will be able to collude to a degree that previously would have been illegal. Two words: Set prices.

I’d also suggest that the successive series of 14 across-the-board fare hikes this year by the major airlines — all done in remarkable lock-step — could arguably be looked at as price fixing. I know they didn’t all get in the same location to do it. With fancy technology and shared assumptions, they didn’t have to book a conference room at the Marriott. Res ipsa, as the tort lawyers say.

As I have said repeatedly, airlines obviously cannot survive charging last year’s fares with this year’s fuel bills. The days of cheap airline fares have ended. More fare hikes are inevitable, and by this fall we will be contending with a domestic air-transportation system that is significantly smaller and less reliable than we have been used to.

But that doesn’t have to mean that the days of airline competition in a free market need to be declared over. Not without some debate about antitrust law, it doesn’t.

I wouldn’t be surprised if Southwest, JetBlue, AirTran, Frontier, Virgin America and some of the other formerly low-cost carriers didn’t start pointing out more clearly some of the nuances of antitrust law which seem to be lost in the rush to ensure that the major airlines can avoid more bankruptcies.

I think they, at least, can spell a-n-t-i-c-o-m-p-e-t-i-t-i-v-e.

###

More Domestic Cuts at Delta

More than any other U.S. airline, Delta is betting the farm on robust international travel. This summer, 40 percent of Delta’s capacity will be seats flying internationally.

Meanwhile, like other U.S. airlines, Delta continues to shrink domestically.

Delta said today that it now expects to reduce domestic capacity 13 percent in second half of 2008 while “international growth remains on track.”

Delta had previously said it would cut domestic capacity by about 10 percent. As previously announced, Delta plans to remove 15-20 mainline and 60-70 regional jets from service by the end of the year.

Some markets are losing service altogether. Delta’s statement said:

“Delta in December began adjusting domestic capacity in light of record fuel costs. Previously announced route cancellations have included service between Orlando and cities such as Las Vegas; Fort Lauderdale, Fla.; and Little Rock, Ark., as well as nonstop flights between Boston and cities such as Charleston, S.C. and Greensboro, N.C.

“While a small number of additional market cancellations are expected as fall schedules are finalized, most reductions are being achieved through frequency reductions and by eliminating a number of unprofitable routes with particular focus on point-to-point flights that can more profitably and efficiently be served via Delta’s hubs. Sample cancellations, effective late summer, include flights between:

--- Orlando, Fla. and Nashville, Tenn.; Key West, Fla.; Raleigh-Durham, N.C.; Birmingham, Ala.; Columbus, Ohio; Lexington, Ky.; New Orleans, La.; Panama City, Fla.; Richmond, Va.; Louisville, Ky.; and Knoxville, Tenn.;

---Boston and Jacksonville, Fla. and Norfolk, Va.;

--- Las Vegas and Los Angeles;

---Pensacola, Fla. and Fort Lauderdale and Tampa, Fla.

xxx

Virgin America Trouble?

The only time I flew Virgin America was from San Francisco to New York earlier this year. I flew first class; the service was terrific, the seats were far more comfortable than most domestic first class seats, the food was great -- but the back of the plane was half empty.

Those shaky mid-week load factors have always been the big question about this airline, which started flying last August.

I'm rooting for Virgin America. But I don't like what I'm hearing: Unspecified capacity cuts of 10 percent, for one.

And now this, in the usually reliable Guardian newspaper in Britain.

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More Cuts at Northwest

As I said, this just gets worse. We are rapidly approaching a very real air-transportation crisis in this country, which depends on air transportation.

And if you hate the flying experience this summer, just wait till Fall.

Northwest Airlines just announced "reduced flying" for the 4th quarter:

---Systemwide capacity reductions, based on available seat miles: a decrease of 8.5 to 9.5 percent over last year's fourth quarter.

---Fleet reductions: 33 DC-9s, and a combined 14 Boeing 757s and Airbus narrowbodies.

In a statement, Northwest said it "has not yet finalized the specific employee impacts related to the reduced flying. However, vfor the resulting headcount reductions, NWA will first look to voluntary separation programs such as early-outs."

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Airlines to Public: This Ain't No Foolin' Around

I am the first to admit that, whatever public unhappiness might be associated with air travel, the airline industry is in one great, big fat fix -- and there are no easy ways out.

This just gets worse.

Oil at $130 a barrel is one thing. Oil at who-the-hell-knows a barrel is quite another. Airlines are up to their butts in alligators. But the airline trade association, the Air Transport Association, fixed today on one immediate and very-hard-to-pin-down problem: oil speculators. Basically, as David Castleveter, the group's spokesman, told me the other day, the industry needs some firm footing (at whatever level), to make any intelligent plans about how to get a grip on this mounting crisis.

Here's the full ATA report:

WASHINGTON, June 17, 2008 – The Air Transport Association of America (ATA), the industry trade organization for the leading U.S. airlines, today testified before the Senate Committee on Agriculture Nutrition and Forestry and Appropriations Subcommittee on Financial Services and General Government on the crisis facing the airline industry resulting from record-high jet fuel prices. ATA also called on Congress to act now to impose common-sense measures to ensure transparency and reel back the overwhelming odds now favoring index speculators and institutional investors, particularly those trading on foreign exchanges.

“The impact of these unprecedented jet fuel prices on the airlines is devastating and airlines may see 2008 losses nearing $10 billion, on par with the worst financial year in aviation history," ATA President and CEO James C. May said. “This year, airlines will spend more than $61 billion on fuel, slightly more than the total fuel bill combined for the first four years of this decade.”

May explained the inextricable link between the nation’s economy and the air transportation system and noted that if airlines continue to spiral downward, so too will the nation’s economy. Already more than 14,000 airline jobs have been eliminated and 100 communities have lost scheduled air service, with more job losses and service cuts inevitable. If oil prices continue their upward path, potentially 200 communities could lose all scheduled air service.

May stressed to Congress the importance of urgent, critical oversight by the Commodity Futures Trading Commission over the energy commodity futures market to curtail excessive oil speculation.

“Leading economic and commodities experts around the world believe crude oil prices today are unnecessarily high and distorted due, in large part, to market manipulation and excessive speculation,” said May. “We are asking for Congress to take steps now – not 60 to 90 days from now – to totally close the loopholes and make the market more transparent and balanced, to ensure a level playing field for all.” May concluded, “If Congress does not act soon, this country will not have a viable airline industry.”

ATA airline members and their affiliates transport more than 90 percent of all U.S. airline passenger and cargo traffic. For additional information about the industry, visit www.airlines.org.

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Public to Airlines: Drop Dead

The 2008 J.D. Power and Associates North America Airline Satisfaction Study, released today, has horrible news for the airline industry. Put simply: the public hates most of you even more than it hates high fares.

(Don’t worry, JetBlue: They still love you.)

Here’s the J.D. Power report:

“Overall satisfaction for the airline industry has declined in 2008 to its lowest level in three years.

The study finds that satisfaction with "people" factors -- including knowledge, courtesy and helpfulness of reservation and gate agents, check-in staff and flight crew -- has declined dramatically since 2007, and is the leading contributing factor to the overall decline in customer satisfaction with airlines in 2008. The decrease in satisfaction with people factors is more than twice as large as the decline in satisfaction with price factors.

"Across the airline experience, from check-in, to the flight, to deplaning, passengers are being affected by the ramifications of carriers making staff cutbacks and have expressed that performance and attitudes of airline staff are suffering," said Sam Thanawalla, director of the global hospitality and travel practice at J.D. Power and Associates. "In this unstable industry environment, it is critical that airlines invest in their employees as a means to enhance the customer experience, as there is a strong connection between employee satisfaction and customer satisfaction. Those airlines that focus on keeping their employees informed and motivated will be better able to change negative consumer sentiment and truly differentiate themselves."

The study measures overall customer satisfaction based on performance in seven measures (in order of importance): cost and fees; flight crew; in-flight services; aircraft; boarding/deplaning/baggage; check-in and reservation. Carriers are ranked in two segments: low-cost and traditional network. Low-cost carriers are defined as airlines that operate single-cabin aircraft with typically lower fares, while traditional network carriers are defined as airlines that operate multicabin aircraft and use multiple airport hubs.

Low-Cost Carrier Rankings

For a fourth consecutive year, JetBlue Airways ranks highest overall and also ranks highest in the low-cost carrier segment for a third consecutive year. JetBlue performs particularly well in six of seven customer satisfaction measures: aircraft; boarding/deplaning/baggage; check-in; cost and fees; flight crew; and in-flight services.

Traditional Network Carrier Rankings

Alaska Airlines and Continental Airlines each rank highest in the traditional network carrier segment, in a tie. Continental ranks highest in the segment for a third consecutive year.

Alaska performs particularly well in five of seven measures: aircraft; boarding/deplaning/baggage; check-in; flight crew and reservation, while Continental performs well in the cost and fees measure.

"While nearly all of the carriers in both segments experience declines in satisfaction since 2007, Alaska Airlines has managed to improve, particularly in satisfaction with the overall check-in experience," said Thanawalla. "Alaska Airlines and Air Canada are the only two carriers that improve overall in 2008, which is a particularly impressive feat in the current volatile industry environment."

The study also finds the following key patterns:

--- The percentage of flight reservations made online has increased from

87 percent in 2007 to 92 percent in 2008. Among traditional network

carriers, 51 percent of reservations were made on the airline Web site

in 2007, compared with 66 percent in 2008. For low-cost carriers, 78

percent of reservations were made on the airline Web site in 2007,

compared with 85 percent in 2008.

--- While complimentary meals are the most-desired amenity for Pre-Boomer,

Baby Boomer and Generation X air travelers, in-flight movies are most

desired by Generation Y passengers.

--- The percentage of travelers who say they chose a particular carrier

because of its rewards program has increased to 22 percent in 2008

from 14 percent in 2007. Price is the most frequently reported reason

for choosing a carrier in 2008 at 39 percent, down from 42 percent in

2007.

The 2008 North America Airline Satisfaction Study measures customer satisfaction of both business and leisure travelers with major North American carriers. The study is based on responses from 19,701 passengers who flew on a major North American airline between April 2007 and March 2008.

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Virgin America Spin

Nice try, Virgin America, but the way I read this announcement from you today, I would say you are in serious retreat, 10 months after you started up. Bottom line: Virgin America is cutting capacity 10 percent (I'd read transcon on that, which is where Virgin America has to compete).

And for cryin' out loud, ain't nobody in town going to buy this jive about the need to "adjust for seasonal consumer demand."

The announcement:

SAN FRANCISCO, June 17, 2008 (PRIME NEWSWIRE) -- Virgin America, the California-based carrier, today announced it will add flights on select high-demand routes, while reducing capacity on off-peak flights this fall, to adjust for seasonal consumer demand for air travel amid high fuel prices. The carrier will add select flights on new and high demand routes. Other than targeted cuts to off-peak flying, the carrier's business model remains the same with no changes to fleet or growth plans, planned new routes or cities, or cuts to its still growing workforce.

"These temporary schedule reductions and strategic additions better reflect the industry landscape we anticipate, given that consumer demand for air travel will be affected by seasonality and, potentially, by higher gas prices in the fall,'' said Virgin America President and CEO David Cush. "As a small, growing carrier, we can trim schedules from less profitable, off-peak flights and add limited capacity on high-demand routes. These are smart business changes that allow us to continue to offer the high-value service we are known for, and support our plans to expand into new markets and add new routes.''

System-wide, Virgin America plans to trim mid-week flights during off-peak periods.
As a result, the carrier will fly at 10 percent less capacity in the fourth quarter than its previously projected fourth quarter capacity. At the same time, the carrier will add flights and frequencies in high-demand markets and continue to grow into new markets. Its year-over-year growth percentage will still be a net positive of 88 percent.

Virgin America will add daily frequencies on its SFO-LAS route on high-demand travel days. On September 4, Virgin America will launch daily non-stop flights between New York's John F. Kennedy (JFK) and Las Vegas McCarran (LAS) International Airports. Recently, Virgin America also announced its hopes to launch multiple flights a day from both San Francisco International Airport (SFO) and Los Angeles International Airport (LAX) to Chicago O'Hare International Airport later this year, pending government approval.

"We have a strong business model and financing, the most fuel efficient fleet in the U.S., and an upscale, competitively-priced service that has been embraced by the traveling public,'' added Cush. "We are in this for the long-haul, and these targeted adjustments will allow us to grow and remain well-positioned and competitive.''

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Roll-a-Boards: Why Did It Take So Long to Invent Them?

Now that we're all lugging all of those bags, I've always wondered:

Why in the world did it take so long for someone in the luggage industry to figure out to employ a wheel, which strikes me as a brilliant, if somewhat early, innovation. Why did it take so long to invent the roll-a-board?

I remember a time not very long ago (I mean the 70s and 80s) when you had to pick a suitcase up to lug the sucker around -- and if you had several, it was a misery and a curse.

So the following question comes from my and my wife's great and good friend, Kim Scott, our horseriding pal from memorable, rain-sodden treks with the legendary Willy Leahy in privative Connemara, Ireland.

Anyway, Kim is a firefighter in Breckenridge, Colo. She and her husband Bryon and their two beautiful babies live at what, to me, is the astonishing altitude of 11,500 feet -- though I am writing this from Tucson where my thermometer this afternoon said 111 degrees at 3 p.m -- which Kim would consider equally astonishing.

So here is Kim's question, which evidently has been passed along in e-mails:

"Why is it that we put a man on the moon before we figured out it would be a good idea to put wheels on luggage?"

I have heard tell that the idea for the perfectly obvious idea of wheels on luggage came from ... flight attendants.

###

DayJet 's Eclipse 500s Keep Flying

DayJet, the single largest operator of Eclipse 500 very-light jets, continued its air-taxi operations normally today after the F.A.A. ordered all Eclipse 500s nationwide inspected following an incident in Chicago last week.

Anxious DayJet customers worried about their travel plans today when press reports said that the F.A.A. had "grounded" all Eclipse 500s after a throttle problem caused both engines on an Eclipse 500 to become temporarily stuck at full power during a landing. The plane eventually landed safely at Midway Airport last week.

DayJet, which now has 28 Eclipse 500s and more than 200 others on order, flies the small planes on air-taxi routes, selling seats on demand, in Florida and elsewhere in the Southeast.

"We got the directive around 9 o'clock last night, and the F.A.A. required full inspection of the fleet because of the incident in Chicago a week earlier. We were aware of the incident and prepared for the air directive that came down last night, and we fully inspected the fleet and completed that in time to service our customers uninterrupted today," said Vicky Harris, a spokeswoman for DayJet.

There are over 200 Eclipse 500s now flying. The planes are manufactured by Eclipse Aviation of Albuquerque, which has said it has orders for more than 2,500.

Recently, DayJet said it had curtailed its ambitious expansion plans and laid off about 100 of its 260 employees because of a tight credit market.
###

Silverjet Gives It Up

No one really believed those "new financing is on the way and we'll get back into business soon" reports this week from Silverjet, which finally threw in the towel today, two weeks after it stopped flying its all-business-class service between London Luton and Newark and London and Dubai.

When the latest promise of new financing collapsed, Silverjet laid off its 300 workers and folded up shop.

It was a nice try, and the founder, Lawrence Hunt, was a gentleman throughout.

###

OK: Some Good News. Air France Fare Sale

Here's one manifestation of the Open Skies treaty that greatly deregulated flying by internaitonal carriers between the U.S. and Europe. A pop Air France fare sale (and note that the fuel surcharge, which can be as much as $300, is included in the listed price):

"NEW YORK – June 12, 2008 – Air France announces fantastic summer fares, offering passengers amazing deals from its U.S. gateways to numerous destinations in Europe during the peak travel season. A perfect opportunity to treat yourself to a European getaway.

Fares are valid in economy class and must be purchased by June 18, 2008 for travel from June 18, 2008 to August 31, 2008. Fares are available for purchase by visiting our website, www.airfrance.com/us, calling Air France Reservations at 1-800-237-2747 or by contacting your travel professional.

Sample one-way fares based on round-trip purchase:

FROM	TO	ONE-WAY FARE*
Houston	Amsterdam	$521
Boston	Budapest	$530
New York	Madrid	$541
Chicago	Barcelona	$547
Boston	Prague	$582
Washington	Bucharest	$585
Philadelphia	Athens	$591
Chicago	Rome	$623

Terms and Conditions

*Fares are valid for departures from 06/16/08 through 08/31/08. Tickets must be purchased by 06/18/08, 11:59PM EDT. Tickets must be purchased 7 days in advance. Valid for Mon -Thurs. departures. Fri - Sun travel is an additional $20 each way. A minimum Sunday night stay is required and a maximum one-month stay is permitted. Travel must be on Air France-coded flights departing from the U.S. Fuel surcharge is included in fares. Government-imposed fees and taxes of approximately $140 are additional, including the September 11th Security Fee of up to $10 per round-trip. Fares are non-refundable and changes are $200. Additional conditions may apply. Fares are subject to class of service availability and may be changed or withdrawn without notice. © Air France 2008.

###

A New Fare Hike and Other Depressing News ...

Sheesh, the bad news never ends. Consider the latest round of fare hikes. Then have a look at the details on Continental's plan to sharply reduce service this fall.

First, this just in from Graeme Wallace at Farecompare.com

"Fare Increase #19 can be declared successful as at 12:30p EDT, both US Airways and Northwest joined in the American initiated

$20 fuel surcharge increase.

Summary of this years activity. 13 Successful increases out of 19 attempts.

1. January 3rd, initiated by United, $10 roundtrip, base airfare hike, successful

2. January 11th, initiated by United, $30 roundtrip, fuel surcharge hike, unsuccessful

3. January 17th, initiated by American, $20 roundtrip, fuel surcharge hike, unsuccessful

4. January 24th, initiated by Continental, $20 roundtrip, fuel surcharge hike, successful

5. February 22nd, initiated by United, $10 roundtrip, base airfare hike, successful

6. February 28th, initiated by Delta, $10 roundtrip, base airfare hike, successful

7. March 7th, initiated by United, $10 roundtrip, fuel surcharge hike, successful

8. March 14th, initiated by United, $4-$50 roundtrip, base airfare hike, successful

9. March 19th, initiated by Delta, $10 roundtrip, fuel surcharge hike, unsuccessful

10. March 27th, initiated by Delta, $10 roundtrip, fuel surcharge hike, unsuccessful

11. April 9th, initiated by United, $4-$30 roundtrip, base airfare hike, successful

12. April 15th, initiated by United, $10-$20 roundtrip, fuel surcharge hike, successful

13. April 24th, initiated by United, $4-$70 roundtrip, base airfare hike, successful

14. April 28th, initiated by Delta, $10 and $40 roundtrip, fuel surcharge hike, successful

15. May 7th, initiated by Delta, $20 roundtrip, fuel surcharge hike, successful

16. May 22nd, initiated by United, $10 - $60 roundtrip, base airfare hike, successful

17. June 7th, initiated by American, $20 roundtrip, base airfare hike, unsuccessful

18. June 9th, initiated by United, $20 roundtrip, base airfare hike, unsuccessful

19. June 11th, initiated by American, $20 roundtrip, fuel surcharge hike, successful

***


And next, the details on Continental's plans to shrink its routes and services. Here.

###

United Adds Charge for First Checked Bag

All truly bad ideas, it seems to me, eventually prevail. So it is that United Airlines has decided to follow American Airlines and charge for the first checked bag.

Here's United's announcement:

"CHICAGO, June 12 -- United Airlines today announced two changes to its domestic checked bag policy. The service fee to check one bag for domestic travel will be $15 each way and the fee to check three or more bags, overweight bags or items that require special handling will increase from $100 to $125 or from $200 to $250, depending on the item.

These changes apply to customers who purchase a ticket on or after June 13, 2008, for travel within the U.S. and to/from Canada, Puerto Rico and the U.S. Virgin Islands on or after August 18, 2008. The $15 service fee does not apply to customers who are flying in United First or United Business or who have premier status with United or Star Alliance. Details on United's checked bag policy are available at united.com/baggage.

"`With record-breaking fuel prices, we must pursue new revenue opportunities, while continuing to offer competitive fares, by tailoring our products and services around what our customers value most and are willing to pay for,' says John Tague, executive vice president and chief operating officer.

United estimates that the new $15 service fee will apply to one out of three customers, and the potential revenue from baggage handling service fees, including those for checking a first and second bag, will be approximately $275 million a year.

The fee to check a second bag is $25 each way and applies to customers who purchase Economy tickets for travel exclusively within the 50 United States, Puerto Rico, U.S. Virgin Islands and Canada, and who do not have premier status in Mileage Plus or Star Alliance.

For itineraries that include international flights (except Canada), checking a first and second bag will continue to be free, and the cost to check more than two bags or items that are overweight or require special handling varies by destination.

Customers may pay these service fees at an airport Easy Check-In(SM) kiosk with a credit card or at the check-in counter with a credit card, check or cash. To ensure smooth operations at the airport, later this year, United will have developed the ability for customers to pay for baggage fees via united.com when they check-in online."

###

Silverjet Redux?

Dunno what exactly to make of this announcement today that Silverjet, the all-business-class airline that ceased operations two weeks ago, is planning a re-launch. In this market?

Anyway, here's what they say in a statement from Silverjet founder Lawrence Hunt:

"Nigel Atkinson and Mark Fry of Begbies Traynor, joint administrators for Silverjet plc and its subsidiaries, confirm that the principal terms have been agreed with Kingplace Ltd. to acquire and relaunch Silverjet, subject to contractual completion which is expected by 13 June 2008.

Mark Fry, senior partner from Begbies Traynor and joint administrator for Silverjet commented:

“We are pleased to have agreed principal terms with Kingplace to relaunch the airline. This agreement is excellent news for the Company’s suppliers, staff and loyal customers.”

Ian Ilsley, Chairman of Heritage and a Director of Kingplace comments:

"Kingplace can confirm that it has agreed terms with Begbies Traynor to acquire Silverjet. If these negotiations are successful, we expect to take on all of the existing staff, to honour Silverjet’s existing customers’ tickets and see Silverjet return to the skies in a matter of weeks.”

Lawrence Hunt, Chief Executive of Silverjet comments:

“I am personally delighted that we now have the necessary backing from a long term investor to relaunch Silverjet. We have received fantastic support from our staff, customers and partners in helping us put this deal together. We will be working around the clock to launch our New York and Dubai services as quickly as possible and we will make an announcement about the date for re-launching our services in due course.”

The agreements are subject to regulatory approval."

###

Trivialities

"One ringy-dingy. Two ringy-dingys. A gracious good morning to you. Have I reached the party to whom I am speaking?"




Way, way too many travel reporters are hamstrung by their inability to do original reporting or analysis, and mired in the level of humor characterized by the inane chitchat of local TV anchorpeople. Or, you can almost hear Lily Tomlin as Ernestine the telephone operator snorting at her jokes.

Thus we had all that giddy attention several weeks ago on the fact that Frontier Airlines had raised the charge for carrying antlers on board -- while the same reports generally overlooked the fact that Frontier had used the predictable yuks to quietly slip in the real news that it was it was adding a fee for a checked bag.

And thus the attention, day after day it seems, to the comic proposition that airline passengers might be charged by their weight, like cargo. Hardy har har.

Last week, the Philadelphia Inquirer, which used to be a grown-up newspaper till a couple of real-estate hustlers bought it, ran phony ads from a made-up airline called Derrie-Air in which tickets were purportedly priced per passenger pound.

Forget the fact that a once-respected newspaper now thinks nothing of jerking its readers around with fake ads. The Inquirer -- where I once worked -- is Philadelphia's problem, and it's hardly the biggest problem faced by a town with a murder rate that causes people to call it Killadelphia.

Instead, consider that the strained joke is still being reported in major media, as if this is the biggest knee-slapper since Spiro Angew got exposed as a bagman.

Let's get serious, media. The airlines have a very limited number of realistic options left. None involve inanities like weighing people in. All of them involve severe reductions in flying -- parking planes, cutting routes, reducing schedules, raising fares to the point where large numbers of people won't fly.

By fall, the national air transportation system will probably be 20 percent smaller than it was last year.

And that's going to be nothing to snort about.

###

More Media Horse**** on Horse Racing

I had one look at the No. 6 horse passing the grandstand before the start of the Belmont Stakes today and it was obvious that little sucker was planning to run like hell, any way it was pointed.

Terror in a three-year-old colt accounts for much of that -- but several horse people I know also spotted Da'Tara as the horse to watch during the post-parade as they headed to the gate.

At 38 to one, it was also the horse to bet on.

And the favorite, Big Brown, looking like he was hung over, was obviously not the horse to bet on, odds be damned. The horse had a cracked hoof to start with, and I'd say there was something else wrong with him, too. It was wrong to race him, but then right and wrong don't count in the ugly thorougbred racing world.

Naturally, lyin' eyes, seeing the obvious, had no effect on the sports-prattlers on ABC, desperate to fan the execrable Triple Crown hype. Big Brown was the hero!

"It seems like the stars are lining up," one of them gushed even as lyin' eyes showed Big Brown obviously disinterested in loading into the gate. You could practically see the poor horse saying, "Been there, done that."

"That's one beautiful, unbeaten athlete," burbled the sportscaster hypemeister.

Then Big Brown lumbered from the gate and folded like a cardboard suitcase, finishing dead last in a field of nine (Casino Drive was a scratch.)

The No. 6 horse, Da'Tara, ran like his butt was on fire, steadily widening his distance all the way to the finish line.

Dang! All of those grandiose TV fanfares, wasted!

Well, at least nobody got hurt.

Now, some of the early online press stories are sobbing that Da'Tara denied Big Brown his Triple Crown. Uh, Da'Tara and seven other horses did that. But anything to keep the phony narrative drama alive.

Incidentally, where did they find that scary 9-year-old kid in the tuxedo singing "New York, New York" at the track like some Vegas lounge lizard? How do you get a 9-year-old boy to do that?

Just askin'

###

Critters On Parade

[Top left: Some nasty, stinky javelinas. Right: The mighty Guardian Surefire M6 line]

I'm off to Tucson today, and this terrific, funny story in the Times yesterday, brilliantly headlined "Peter Rabbit Must Die," reminded me of the critter problem we all face at home and when we travel.

It's outta control. At our house in New Jersey, a groundhog family has been in residence for some years under the deck, from whence they assault not only our herb garden but the neighbors' as well.

Meanwhile, a neighborhood cat who roams free waited on a neighbor's doorstep to murder two wild ducks who waddled up from the creek down the hill. Not to mention the raccoons, who merely laugh at any trash can labeled "raccoon proof."

If there weren't laws about these things, plus dangers to passersby, I'd get a shotgun and wait Elmer Fudd-like behind a bush at dawn.

Now I head to Tucson. I'm worried that in my absence (my wife is staying behind this time, and she has no practice in raccoon policing) the critters will think it is safe to run wild, so to speak.

Meanwhile, in the Arizona desert, critters of another kind roam the earth.

A herd of wandering javelinas can often be encountered. Javelinas are nasty, stinky critters with sharp tusks. They look a bit like wild boars, but apparently are not related (in that you would need to be desperately hungry to eat a javelina, though a cowboy told me he's heard tell).

Their favorite food is prickly-pear cactus, which tells you something about how tough and mean they are, because a prickly-pear is something you don't even want to touch, let alone chew on. (Yes, I know some people make prickly-pear jelly. It's inedible, even in jelly form without the needles, in my opinion).

Most mornings, I see a pack of maybe eight javelinas, including babies (or whatever you call a young javelina) wandering around. Neighbors of ours, both physicians, live in a house that once was occupied by Paul McCartney and his wife, Linda, while the McCartneys were building the ranch in the foothills where Linda eventually died. They report routinely seeing a herd of javelinas that number over 20.

You don't want to mess with a javelina, incidentally. When they feel threatened, they will charge and "tear your leg up," said another neighbor, who wrangles horses.

One morning last winter, I went out to the garage and had trouble opening a closet door. Investigation showed why: A pair of adult javelinas was huddled in the corner, blocking the door, and they were indignant about being disturbed. I retreated, hitting the automatic garage door-opener on the way, and the critters trotted out into the sunlight without further incident.

The next morning, I got into the car, noticing that I'd left the passenger-side door a bit ajar overnight. I was reaching across to close it when a small rattlesnake who'd curled up on the passenger seat objected.

Another hasty retreat.

A gun is one precaution, but it's hard to hit a snake, and shooting at them just pisses off javelinas.

Another option, I learned, is a very bright flashlight. Thus it is that I own a Guardian Surefire M6 anodized tactical flashlight, capable, I believe, of illuminating the summit of Mt. Lemmon, 20 miles away. I'm talking S.W.A.T.-team, Navy-Seals-combat bright, by the way.

"It'll freeze a lion in his tracks at 50 yards," said a man in the gun shop where these flashlights are available at a shocking price.

Which is good, because the latest news is that a couple of mountain lions have wandered down from the hills and have been spotted sunning themselves on Tucson patios. Out our way, the Neighborhood Watch is on the case, however, advising everyone to bring walking sticks on the Monday morning hike.

It's always something.

###

The Incredible Shrinking U.S. Air Transportation System (Continued)

Just asking: When are the words "national air-transportation crisis" going to sink in in Congress and in the media?

A national air-transportation crisis is what we're facing, after all.

The latest indication comes this morning from Continental Airlines, a day after United Airlines announced major domestic capacity and fleet reductions.

In a desperate sounding letter this morning to its 45,000 employees, Continental says the current airline business model "doesn't work" and that successive fare increases this year have not been sufficient to address the crisis.

So, Continental says, it is:

---Reducing flights, with fourth-quarter domestic mainline departures expected to be down 16 percent from last year's fourth-quarter. That will translate into a mainline seating capacity reduction of 11 percent.

---Cutting its fleet. By the end of next year, the airline will have removed an additional 67 Boeing 737s from the fleet -- 27 of them in September alone.

---Eliminating about 3,000 jobs.

Despite what you may have been reading, the airline story is not about stock prices and mergers and those pant-loads occupying the executive offices of the major airlines.

Incidentally, while some major airlines are run by incompetents, I do admire Continental's Larry Kellner and Jeff Smisek, who have run the best major airline, and who have honorably chosen not to accept salaries for the rest of this year. And I also admire the people running Southwest, who were smart enough to sacrifice cheap short-term stock market gains and instead look down the road beyond the next quarterly report and invest in hedges on oil.

The airline story is about transportation, the national economy and the American travel culture.

It's about the increasing difficulties you and I are going to have getting from here to there in the United States.

***

Here is an excerpt from the Continental letter:

"Dear Co-worker:

We've always said that you deserve open, honest and direct communication. This letter and the attached employee bulletin and Q&A are part of that commitment.

The airline industry is in a crisis. Its business model doesn't work with the current price of fuel and the existing level of capacity in the marketplace. We need to make changes in response.

While there have been several successful fare increases, those increases haven't been sufficient to cover the rising cost of fuel. As fares increase, fewer customers will fly. As fewer customers fly, we will need to reduce our capacity to match the reduced demand. As we reduce our capacity, we will need fewer employees to operate the airline. Although these changes will be painful, we must adapt to the reality of today's market to successfully navigate these difficult times.

The attached employee bulletin and Q&A outline some of the steps we are taking to address this industry crisis. The situation for all airlines is serious, and the actions we are announcing today are necessary to secure our future. We regret the loss of jobs caused by this crisis, and we will do our best to minimize furloughs and involuntary terminations.

These actions will help Continental survive this crisis. You have our ongoing commitment to keep you informed as the industry evolves and adapts to these unprecedented challenges. It is important that we all keep our focus on working together during these difficult times."

###

###

United Slashing Capacity and Fleet; Buh-Bye, Ted

The march to a smaller, less reliable national air-transportation system picked up its pace today as United Airlines announced a sweeping series of reductions in its fleet, capacity and service routes. United also said it was killing its boutique product, Ted, an airline-within-an-airline that never quite took off.

United emerged from bankruptcy in early 2006 calling itself a "smaller, more efficient" airline, and offering a five-year business plan that projected the price of oil at an average of $50 a barrel -- at a time when oil was already trading at over $55 a barrel.

Among the cutbacks announced today by United:

---Pulling 100 airplanes -- 94 Boeing 737s and six 747s -- from its fleet of about 460. (United had previously announced that it would retire 30 of its 737s.) About 80 of those planes will be out of service this year, and the rest next year.

---Reducing domestic seats in the fourth quarter by 14 percent over the fourth quarter of 2007, and further reducing capacity in 2009.

---Eliminating Ted, which has a fleet of 56 Airbus A320s that are included in the overall United fleet figure. Those A320s will be redeployed as mainline United aircraft.

United's hapless CEO, Glenn Tilton, said that the cutbacks were intended to "leverage capacity discipline" and "develop new revenue streams."

Tilton did not elaborate on what he imagined those "new revenue streams" might be, but the major U.S. airlines have been betting the house on international routes, on the assumption that international flying will remain profitable and demand will hold up.

Here's the full text of United's statement today.

United was spurned repeatedly by competitors this year in its attempts to find a merger partner.

Two things to watch closely at United:

---1. Most of those planes United plans to pull out of service are leased, not owned. United says it is trying to negotiate a deal with its leasing companies. Remember, the payment on a leased airplane comes due each month whether you're flying it or not. (Of the total 460 aircraft in its mainline fleet as of Jan. 1, 205 were leased outright. Another 142 of the owned aircraft were listed as "encumbered." The vast majority of the older 737s are leased.)

---2. United's very close financial relationship with Chase bank, which props up its frequent flier program with its affinity credit cards by buying huge volumes of United miles to offer customers. Chase certainly is giving some thought to its exposure through that United link.

Meanwhile, as I have been saying all year, prepare for a significantly shrunken domestic air travel system that will significantly impact business and leisure travel, and the $750 billion domestic travel industry, for a very, very long time.

###