Airfares Up 9.2% in Top 175 Markets in 4Q of 2010; 2011 Passenger Demand Seen Declining

Fares keep climbing as jet-fuel prices top $3.33 a gallon. No firm handle yet on exactly how much fares are up overall in the first quarter of this year.

But an analysis by Boyd Group International of the latest available air traffic data indicates that average fares in the top 175 U.S. markets were up 9.2% in the fourth quarter of last year, compared with the same period in 2009.

The average one-way ticket, including federal fees and taxes, jumped from $157.63 to $ 172.22. This according to a quarterly traffic snapshot accomplished by Aviation DataMiner, the leading industry information and intelligence source, provided by Boyd Group, which added:

"The airport where consumers paid the highest fares on a per-mile basis was Dallas/Love, where Southwest is still restricted to relatively short-haul flying.

"The highest one-way total fare was paid at Fairbanks, at $350.05, where the average passenger trip is over 1,600 miles, one-way.

"'Care needs to be taken when comparing fares at airports. The geographic location will affect the distance people fly, and that affects the total dollars paid per passenger. The best metric is what airlines are charging at an airport on a per-mile basis,' said Tim Sieber, Boyd Group vice president.

"Using the fare-per-mile metric, Dallas/Love passengers paid 23.7 cents per mile, with an average passenger trip length of 553 miles. This compares to Dallas/Ft. Worth International, where the average fare-per-mile was 18.2 cents, with an average passenger trip of 1,053 miles.

"There are no indications that the cost of flying will go down in the future. 'We can expect another 8% to 12% jump in fares in 2011,' said Michael Boyd, president of the Colorado-based consulting and research firm. 'With oil going up, airlines will need to prepare for two key dynamics: higher jet fuel and a declining traffic demand.' This latter prediction comes in the wake of very strong traffic in the last part of 2010 and the early months of 2011. "By the end of this year, those rosy numbers will be a faint memory. The airline industry is in for a tough time," he added.

"Separately, Boyd Group International is forecasting a decline in US air passenger enplanements -- both international and domestic -- of between 1.4% to 3.5% for the full year of 2011. 'The fourth quarter could be a real downward spiral. It will depend on how much fuel goes up and capacity goes down,' according to Boyd."

The full Traffic Snapshot can be downloaded at www.AviationPlanning.com.

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St. Louis Airport Closed by Tornado

Airlines have steadily whacked away at service at the St. Louis airport in recent years, but a tornado has now shut it down. However, according to the St. Louis Post-Dispatch, airport officials now say they expect it to be operating tomorrow.

St. Louis usually has about 280 departing flights daily. All are cancelled now and till further notice. As of today, the top airlines at St. Louis and the numbers of their cancelled flights are: Southwest (67), American (25), Cape Air (15), Trans States (9), Delta (9).

By the way, the Federal Aviation Administration's hilariously useless airport-delays online page which some in the media credulously cite regularly, unaware that it is almost never accurate) is, of course, hilariously useless right now. It says:

Lambert-St Louis International Airport (STL)

FAA Status: Normal

General Departure Delays: Traffic is experiencing gate hold and taxi delays lasting 15 minutes or less.

General Arrival Delays: Arrival traffic is experiencing airborne delays of 15 minutes or less.

That, of course, is nonsense. The airport is shut right now.

Meanwhile, this notice was posted today by the St. Louis airport, which hasn't bothered to update it because, hey, who needs timely information about air travel?

Lambert-St. Louis International Airport is closed indefinitely due to severe storm damage on Friday, April 22.

All departing and arriving flights are cancelled until further notice pending full safety assessments of airport facilities.

Contact your airline for latest updates and options for all departing and arriving flights.

St. Louis City, St. Louis County and surrounding municipalities are actively assisting the airport with cleanup efforts and safety review of all operations in and around the airport complex.

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Beware of Credit Card Fraud After a Hotel Stay

I've written in the past about fraudulent credit-card charges that can quietly appear on your statement after a hotel stay.

Yup, just checked my American Express statement after a two-day stay at a hotel, and there it was: A charge for $23.76 from some outfit called Etunes LLC of Van Nuys, Calif. A quick Google search shows others complaining about non-authorized charges from Etunes -- a company I have never done business of any kind with and, in fact, would not know from Looney Tunes.

The last time this occurred, again after hotel stays, the phony charges, a bunch of them amounting to over $400 -- were from Itunes, a legitimate business. Investigators told me that hackers can readily access hotel point-of-sale computer systems and grab your data. They then often probe with charges, sometimes to legit businesses, to see if the info they've stolen is good. And to see how closely you're paying attention to alien charges.

As to this most recent fraud, I don't know yet what the hotel where I stayed this week has to say about it, so I won't name them till after I have spoken with them on Monday to see whether they know that they have a security problem.

And by the way, I have not been exactly thrilled with American Express recently. Today, when I phoned Amex Platinum to report the clearly fraudulent "Etunes" charge, the man on the phone sounded awfully casual about it. In fact, he was way more interested in trying to sell me American Express Fraud Protection services ("We'll notify you of suspicious activity") than in addressing the issue of doing business with obvious crooks who are seeking to defraud your best customers.

So be careful out there with your credit card statements, and especially check your statements after hotel stays. Be careful not to leave personal data, like that found on a hotel bill, lying around. Hotels are one of the most perilous places for credit-card fraud, and the hotel industry has been very remiss in not addressing this problem head-on.

I wrote a column about this last July and followed that up with a post here in August about the issue.

Here's my blog post in its entirety from last August:

***

Your credit card is far more likely to be hacked at a hotel than anywhere else you use it. According to a report in January by Trustway SpiderLabs, 38 percent of the hacking breaches it investigated last year occurred in hotel credit card systems.

That was way more than breaches in other hacker favorites, including retail and restaurants.

The most recent example of hotel hacking, discovered last week, occurred starting in May at the Doherty Hotel, a convention hotel in Clare, Mich. About 150 people have reported that fraudulent charges appeared after they patronized the hotel. A Secret Service spokesman told the Clare Times online (report is here) that the hotel's guest computer system had been identified as the target of the hacking attack.

It is clear that lots of hotels have these issues. It isn't clear exactly how many. But the reports are troubling.

In June, it was reported that Destination Hotels, a chain of 30 luxury hotels, had been the target of what ABC News called "an intense database attack" that compromised at least 700 customer credit cards. Also in June, Wyndham Hotels said that a "sophisticated hacker" had gained access to credit-card data at up to 31 of its hotels between last November and January 23, 2010, when the attack was discovered.

For Wyndham, it was the second time in two years that credit cards had been hacked.

Wyndham and other hotels named in recent reports on the problem have said they are improving their point-of-sale and other credit-card data technology systems in response.

After I wrote about the Wyndham and Destination incidents, I got a lot of calls from national and local radio stations asking me to discuss the issue. Why hotels? they all wanted to know. And what can we do to protect ourselves?

Well, the reason hotels are a good target is that hotels collect a lot of customer data that a hacker can fairly easily access through point-of-sale systems and readily score enough information to be able to steal a credit card's data.

Mainly, this is because individual hotels are often owned by small or regional entrepreneurs -- investors who actually build, develop and own the properties, many of whom have been frantic in recent years as rates and occupancy have plunged. (Big hotel chains like Hilton or Marriott mainly manage the various brands, and charge the actual owners hefty fees for being associated with, and adherent to the standards of, a given brand).

With less money coming in following the Wall Street collapse, after a heady period of the best prosperity in the hotel industry's history, many hotel owners were caught flatfooted. Even while revenue plunged, they had to invest heavily in improving technology in immediate guest-demand things like better Wi-Fi and high-definition TV. At the same time, global hackers discovered that hotel point-of-sale systems were particularly vulnerable. In many instances, hotel owners simply have not yet invested what they need to in making their back-office data-processing technologies more secure against the new breed of hackers.

It often takes a hotel months to even discover that its system has been hacked.

Consumers have a degree of protection in credit-card fraud -- assuming they notify their credit card issuer promptly of a fraudulent charge.

But I've been advising people that it's easy to get blindsided even with this protection. For one thing, frequent travelers often don't carefully review their credit-card purchases on the road and may overlook fraud. For another, we're all now so accustomed to whipping out that credit card for small purchases, even a coffee at Starbucks, that we are more likely to not notice on our credit-card activity-reports the kind of small, frequent illegitimate charges that hackers first start hitting your card with, just to probe it, or in a case of basic hit-and-run.

In the last six months, both my wife and I have had credit cards we use for travel hacked. In both cases, the fraud began with multiple small charges listed as being for numerous Apple iTunes purchases, all in a very short period. In both cases, the fraud totaled over $400 before we contacted our credit card companies. (Neither of us has an Apple iTunes account, incidentally.)

In both cases, the fraudulent charges were removed. However, in both cases, the credit card company canceled our existing cards and issued new ones. With new numbers, of course.

Oops, that led to a problem I hadn't anticipated. Like many people in recent years, especially travelers who are away from home a lot, I tended to put routine household and other bills on credit card "auto-pay." Works beautifully. But when your credit card number changes, those auto-pays suddenly can get rejected if you haven't gone to the trouble of changing them to the new card number. I thought I caught most of them in time, but I overlooked a couple like the water bill. That took more phone calls to fix than I cared to make.

The credit card industry 9to protect itself, not consumers, of course) is now pushing hard for hotels and other businesses to adopt uniform standards for data security. Consumers, meanwhile, need to be simply up to date on issues such as credit card fraud. The Privacy Rights Clearing House has useful information on this.

I spoke recently with one of the leading experts in credit-card fraud, Anthony C. Roman, a private investigator in New York who now specializes in high-tech fraud investigations, but who once worked as a bodyguard for the infamous hotelier Leona Helmsley.

Here's some of what he said about hotels and credit-card hacking:

Hotel credit card point-of-sale systems (which begin at the place where your card is physically swiped through the machine) often offer a hacker the greatest trove of personal data for the least effort, he said. Hackers can work on site, or more often remotely online, using readily available personal information, sometimes culled from customer receipts and bill print-outs.

In the hotel industry, "the collection, storage and transmission of credit-card information is of particular importance," he said.

At many hotels, "upper executive management is developing more secure systems and procedures with regard to personal-data security, including the personal data on the magnetic strip on the back of credit cards, including things like date of birth, Social Security number, home address -- that kind of thing. That stuff is actually on the credit card."

Credit card issuers are trying to crack down harder to comply with standards that encompass "maintaining a secure computer network, which includes the computer network from the POS, point of sale, from the card-swiper through the internal network and terminals at the front desk or in executive or administrative offices. And after that, the broader network between that particular hotel site and the corporation at large all need to be secure," he said, adding:

"The best method to protect the data is by having a POS [point-of-sale] system that uses a transaction code in which the data is immediately encrypted when it hits the machine, and therefore not hackable for most casual hackers. It is, though, still somewhat hackable for the geniuses -- but most hackers are not geniuses or even brilliant. So we're talking about mitigating the vast majority of attacks" with a more secure point-of-sale front-end system that is protected through encryption.

"It’s not a standard created by the hotel, it's a worldwide standard created by the credit card industry," he said. "It requires purchasing not only of software and hardware technology, firewalls, encryption programs, et cetera, it also requires putting in place standardized procedural methods that are administrative in nature." That includes procedures for complex passwords that change at "rate differential periods" so no regular pattern can be discerned, he said.

This means spending more dough, if you're a hotel owner.

Also, he said, "there should be an audit trail to everything, as well as standardized preliminary and ongoing training of staff, and an overall system reflecting when and if privacy-sensitive data is released, to whom, and under what circumstances."

Hotels are by nature customer-service friendly. This builds a weakness into the system. A hacker with one stolen (or otherwise obtained) document, even a discarded bill, can sometimes call a hotel and say he or she needs a new copy of a bill. Hotels tend to comply.

"RevPARS [revenues per available room] are down dramatically as result of the economic turndown," he said. Many hotels "simply don’t have the money, and aren’t making the investment [in better technology security] at this time," he said.

The message hotel owners are hearing from credit card companies and even hotel chain management is this: Find the money and fix your systems. And as these instances of hacking continue, consumers are going to be demanding the same.

###

Here's the FAA 'Emergency' Directive Mandating 737 Inspections: Never Mind

Here's a link to the .pdf of the awaited FAA compliance directive on the issue of 737s that need to be inspected for possible fuselage cracks.

Ah, just as Southwest Airlines has insisted, the directive gives Southwest a pass on the 79 737s it grounded for inspection over the weekend. The "emergency" order, called an airworthiness directive, clearly indicates that nearly all of the aircraft that are covered by the order -- mostly involving Southwest 737-300s with a certain number of cycles (landings and takeoffs) -- have already been sufficiently inspected.

So, despite alarmist media stories saying that the FAA was rushing to issue an emergency order today for airlines to inspect 80 U.S.-based 737s -- with the clear implication that these planes might all need to be grounded -- what we actually have is a mainly retroactive order that provides FAA paperwork for what Southwest has already done.

That is, no additional major groundings (some airlines with one or two 737-400s or 500s might need to take them out for inspection). No air-travel disruptions.

They could have told us that yesterday.

Under "compliance," the FAA directive issued this afternoon says:

--"Comply with this AD within the compliance times specified, unless already done.

Some other excerpts:

--"This AD applies to the Boeing Company Model 737-300, -400, and -500 series airplanes, certificated in any category, as identified in Boeing Alert Service Bulletin 737-53A1319, dated April 4, 2011...."

--"This AD was prompted by a report indicating that a Model 737-300 series airplane experienced a rapid decompression when the lap joint at stringer S-4L between body station (BS) 664 and BS 727 cracked and opened up due to cracking in the lower skin at the lower row of fasteners. We are issuing this AD to detect and correct such cracking, which could result in an uncontrolled decompression of the airplane."


Apropos this situation, I like this reader comment on the airline blog of the Dallas News newspaper (Dallas being Southwest's hometown):

"Southwest is handling the situation correctly. They didn't wait for the FAA to force their hand at inspection as did with American Airlines a while back. Southwest went to Boeing and identified the aircraft to be inspected. You want a proven track record, look at how many crashes Southwest has had that resulted in fatalities to passengers = 0. In fact, they have had only 2 incidents, both on landings. The only passenger death to date is when a 19 yr old guy tried to storm the cockpit of the plane and 8 passengers beat him to death."

###

FAA Inspections of 737s: Who? What? When? Where? Why?

Let's just say I'm skeptical about the seriousness of this "emergency directive" coming today from the Federal Aviation Administration that supposedly will require intense inspections of about 80 Boeing 737s in the U.S.

I seem to be the only reporter in the country who's asking the basic Five W questions -- Who? What? When? Where? Why? Not that that makes me such a hotshot, because frankly I haven't managed to get answers yet.

The FAA Web site is still highlighting yesterday's announcement that this "emergency directive" is coming today, but with no sign of said emergency directive as of early afternoon today. And here is what I saw a minute ago when I clicked onto the FAA's "airworthiness directives" (ADs) link: "The ADs site is temporarily down for maintenance."

Beautiful!

Here are some basic questions that need answers:

Who among the airlines will need to do something to comply with this FAA directive? What specifically will need to be done? When will this need to be done? Where will it occur? And, why now?

Southwest flies most of the older-model 737s that evidently are covered in the directive. Southwest says it's already in full compliance with the directive, thanks to the inspection procedures that followed its grounding of 79 Boeing 737-300s over the weekend after a 5-foot hole ripped open on one on a flight at 35,000 feet over Arizona.

If that is the case, and no one has given me any reason so far to doubt it, then what exactly is the purpose of this FAA directive, which the FAA has said will cover three models of older, high-turnover 737s -- mostly in the 300 series, but including 400s and 500s? And if it's an emergency, why the confusion and foot-dragging over the basic details of how air travel might be affected by the government's ordering intensive inspections of a large number of 737s? Wouldn't that require the grounding of those airplanes?

But if, as Southwest seems to be saying, the directive is actually moot on arrival, why does the FAA announcement about the forthcoming emergency directive say [italics mine] that it "will require operators of specific early Boeing 737 models to conduct initial and repetitive electromagnetic inspections for fatigue damage?"

Here's the strange FAA press release, sent out yesterday, announcing the forthcoming release, today, of this baffling "emergency directive."

It's afternoon in Washington, and so far the emergency seems to be rumored more than defined, which is never, ever a good thing in emergency procedures.

###

FAA Orders Emergency Inspections On Older, High Turn-Around 737s -- Most of Them Flown by Southwest

The Federal Aviation Administration will issue an emergency directive tomorrow that will require operators of specific Boeing 737 models to "conduct initial and repetitive electromagnetic inspections for fatigue damage" on those planes.

"This action will initially apply to a total of approximately 175 aircraft worldwide, 80 of which are U.S.-registered aircraft," said the FAA. Most of the aircraft in the U.S. covered in the directive are operated by Southwest Airlines, the agency said.

It is not immediately clear if this directive will affect the Boeing 737-300s that Southwest has said it has already inspected for possible cracks, and returned to service, since the weekend.

Southwest said today that as of 3:30 p.m. Central Time it had inspected most of the 79 Boeing 737-300s it grounded Saturday. Inspection has been completed on 67 aircraft, 64 of which were returned to service.

"The remaining three aircraft did have findings of subsurface cracks and will be out of service until Boeing recommends an appropriate repair," Southwest said. As usual, Southwest makes it a point to include the aircraft's manufacturer, Boeing, in its updates on the problems.

Southwest also said today that it believes the inspections over the weekend and on Monday put it already in compliance with the emergency directive that the FAA will issue tomorrow. "With our knowledge of what the FAA has planned, we believe the 79 aircraft already identified for inspection will accomplish this directive for Southwest Airlines," the airline said in a statement this afternoon.

Southwest said it expects to be able to operate its full schedule tomorrow.

During the inspections of the grounded jets, Southwest said it found "small subsurface cracks" in three planes, which are being repaired. Southwest is continuing to inspect the remaining grounded 737-300s.

If Southwest is wrong about being in compliance already with the new FAA emergency directive, it might need to re-inspect some of those planes, and maybe ground some others, and cancellations and delays that have been affecting the airline since Saturday could continue.

The planes covered by the new FAA directive are 737s with high flight cycles (the number of takeoffs and landings), in the 300, 400 and 500 series. Southwest's flies 25 of the 500-series 737s, none of which had been affected by the airline's decision to insect the 79 Boeing 737s. Most Southwest's 737s are later-model 700 series.

Southwest flies a total of 548 Boeing 737s of all models.

Transportation Secretary Ray LaHood said of the Southwest incident, in which a five-foot hole ripped open on a 737-300 over Arizona late Friday afternoon: "Last Friday’s incident was very serious and could result in additional action depending on the outcome of the investigation."

FAA Administrator Randy Babbitt said, “The FAA has comprehensive programs in place to protect commercial aircraft from structural damage as they age. This action is designed to detect cracking in a specific part of the aircraft that cannot be spotted with visual inspection."

The FAA airworthiness directive will require initial inspections using electromagnetic, or eddy-current, technology in specific areas of the aircraft fuselage on certain Boeing 737 aircraft in the -300, -400 and -500 series that have accumulated more than 30,000 flight cycles. It will require repetitive inspections at regular intervals.

My pal Joe Brancatelli at Joesentme.com speculated that mostly 737-300s would be affected by the FAA order, because Southwest typically uses that model on shorter-haul routes, where planes take off and land more often, and thus log higher use cycles.

Why issue an "emergency" directive that doesn't take effect till tomorrow? Unclear to me at this point. A cynic might suspect that the FAA could be hoping to retroactively cover itself on the Southwest incident with the new directive.

Last November, the FAA published a rule designed to address widespread fatigue damage in aging aircraft. The rule requires aircraft manufacturers to establish a number of flight cycles or flight hours a plane can operate and be free from fatigue damage. The rule requires aircraft manufacturers to incorporate the limits into their maintenance programs.

###

Southwest Still Cancelling Flights As 737-300s Get Closer Looks; Another Southwest 737 Is Diverted

Southwest is cancelling fewer flights today than on Saturday and Sunday -- 77 as of mid-morning, compared with about 600 total over the weekend.

On Saturday, the airline grounded 79 of its Boeing 737-300s for inspections for structural cracks after a five-foot hole ripped open Friday on a 737-300 with 118 passengers and 5 crew aboard at 35,000 feet over western Arizona. The plane made an emergency landing in Yuma.

Meanwhile, another Southwest flight had a problem last night and was diverted to Los Angeles with 142 aboard when an electrical burning smell permeated the cabin. That flight was bound from Oakland to San Diego.

Initial reports don't say whether that plane was a 737-300 model, but with 142 aboard it most likely is, as later model 737s have slightly smaller capacities.

The 737-300s are no longer in production by Boeing, but are still widely used by world airlines. Some of them also have been converted to private jets and some are in use as freighters.

Paul Sheridan, the head of risk for Ascend, the aerospace investor advisory firm, pulled together a list of all of the 737-300s currently flying.

Here's the breakdown:

Africa--35

Asia--200

Australasia--25

Europe--220

Latin America/Caribbean--71

Middle East--14

North America--196

Unknown area--1

Total--762

Operators with more than 10 aircraft. Figures are aircraft currently In Service and include freighters and other uses:

Southwest Airlines--169

Lufthansa--33

Air China--28

China Southern Airlines--25

Jet2--24

Webjet--23

Norwegian--19

Europe Airpost--18

US Airways--18

China Eastern Airlines--16

Air New Zealand--15

Batavia Air--15

Viva Aerobus--14

bmibaby--11

Shandong Airlines--10

###

Southwest Cancellations Increase Today As Inspections Continue for Fuselage Cracks

After a harrowing incident late Friday afternoon when a five-foot-long hole ripped through the fuselage of a Southwest Airlines 737-300 airliner at 36,000 feet over Arizona, disruptions and delays continue on Southwest today. In fact, Southwest is cancelling more flights today than it did yesterday.

Yesterday, Southwest grounded 79 of its 737s to check for fuselage cracks. Southwest cancelled 252 of its 2,901 departures yesterday and had long delays throughout its network.

Today, as of 2 p.m. EDT, Southwest has already canceled 279 of its 3,089 scheduled departures, about a third of which had departed by 2 p.m., according to Flightstats.com

###

4 Dead in Crash of Gulfstream G650 on Test Flight in New Mexico

A Gulfstream G650 crashed Saturday morning during takeoff-performance tests in Roswell, N.M. Two Gulfstream pilots and two Gulfstream flight-test engineers died in the crash, Gulfstream Aerospace said.

The G650 is Gulfstream's newest and most luxurious long-range large-cabin jet, with a price tag of $64.5 million. Gulfstream has more than 200 firm orders for the private jet, which is expected to be delivered starting next year.

###

After Hole Rips Open in 737 Fuselage In Flight, Southwest Airlines Grounds 79 Planes

[Blogger Shawna Malvini Redden was on the flight and took this photo of the hole that ripped open on the 737. Here's her report with more photos on her blog The Blue Muse.]

A Southwest Airlines 737-300 flying from Phoenix to Sacramento had a sudden rupture in its fuselage at 36,000 feet yesterday afternoon and made an emergency landing in Yuma, Ariz.

Today, Southwest is experiencing flight delays and cancellations throughout its system as the airline grounds 79 of its 737-300s for inspection. Southwest's top 10 departure airports are Chicago Midway, Las Vegas, Phoenix, Baltimore-Washington, Denver, Houston Hobby, Dallas Love, Los Angeles International, Orlando and Oakland.

{UPDATE -- As of 8 p.m. EDT tonight, Southwest had canceled 251 flights and was running an average of only 67 percent on time for the 2,169 flights that did depart, according to Flightstats.com

On its Web site, Southwest claims that it is "experiencing relatively few flight delays and cancellations while we are proactively inspecting some of our Boeing 737s." The numbers show how "relative" that assertion is, but I have to say, the use of that word "proactively" in this particular context annoys the hell out of me. I mean, consider the alternative.}

The plane, with 118 passengers on board, diverted to Yuma "due to loss of pressurization in the cabin," Southwest said, adding: "Upon safely landing in Yuma, the flight crew discovered a hole in the top of the aircraft."

Well, here is a news flash for you, Southwest: Your passengers actually "discovered" that rupture somewhat sooner, as some of them have posted photos of the gaping hole in the overhead of the cabin as the plane suddenly lost pressure and the oxygen masks dropped.

One passenger, Larry Downey, told a Phoenix TV station that he was directly below the hole when the fuselage ripped open. "You could look out and see blue sky," Downey said. Pilots quickly brought the airplane down to 11,000 feet as they headed for Yuma.

As Southwest grounded the 79 aircraft for inspection, major disruptions roiled its system -- and it's expected that there will be significant cancellations and delays on Sunday as well.

Southwest flies only Boeing 737s, and has a total of 548 of them in its fleet -- and 171 of them are older 737-300 models, which are no longer in production.

In 2009, a Southwest 737-300 had a similar fuselage rupture during a flight from Nashville to Baltimore. That plane made an emergency landing.

A year earlier, the Federal Aviation Administration had ordered Southwest to pay a fine of $10.2 million, the largest it had ever sought against an airline, for failure to fully inspect older 737s for cracks, and for flying them before inspections were completed.

Today, Southwest said it is "working with Boeing on an inspection regimen for the 81 affected Boeing 737 aircraft in the fleet [Southwest later revised that number to 79], which are covered by a set of Federal Aviation Administration Airworthiness Directives aimed at inspections for aircraft skin fatigue. These aircraft will be inspected over the course of the next several days."

Kind of interesting, by the way, how Southwest is stressing that word "Boeing."

In a statement earlier today, Southwest said: "Overnight, the airline worked with engineers from the Boeing Company to further assess the damage to the aircraft and develop an inspection regimen to look more closely at 79 (not 81 as was previously reported) of its Boeing 737 aircraft which are covered by a set of Federal Aviation Administration Airworthiness Directives aimed at inspections for aircraft skin fatigue. Those aircraft will be inspected over the course of the next several days at five locations. ..."

Southwest is known (and admired) for rapid turnaround of its 737s during its intense daily operations. In December 2010, a Federal Aviation Administration "Airworthiness Directive" that covered various 737 models spoke of concerns about "fatigue cracks at certain frame sections" in 737 fuselages, "... caused by high flight-cycle stresses..."

Here's a copy of that directive.

Today, the National Transportation Safety Board has a team in Yuma to investigate the damage to the airplane that diverted there yesterday.

###

Teaching Your Daughter How to Curtsy And Other Vile Notions

As I always say, every truly horrible idea eventually has its day, and here, via the reliably fatuous AP, is further proof of that, as if we didn't need it at a time when Donald Trump claims he is running for president.

Gushes the AP: "A scene from "My Fair Lady" is playing out in a posh London hotel ahead of this month's royal wedding -- a princess boot camp." Parents of "pint-size wannabe princesses" are paying over $4,000 for a one-day seminar to teach their little girls how to behave like "princesses" -- in a walk-up to the imminently cringeworthy media hype about a royal wedding that is soon to gag us all.

According to the AP, the little princesses are being taught "how to act if they meet the queen," which I presume is a reference to Elizabeth II and not to the Prince of Wales.

The AP reporter also seems to badly misread "My Fair Lady," based on the George Bernard Shaw play "Pygmalion," which is a lampoon of English class snobbery and a celebration of independent, smart, strong-willed young women. No one fitting that description, incidentally, will be found among the horse-faced Hanovarian grifters who will assemble in London with their big hats on later this month to pull another publicity stunt to keep those tourist bucks coming in.

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Brazil Midair Collision Testimony Update

I thought this article in today's New York Times deftly and accurately captured the nuances of the moment as two American pilots, on trial in absentia in Brazil for the 2006 Amazon midair collision that killed 154, began testifying via videoconference from Long Island.

Alas, the judge on the other end of the shaky audio-video system in Brazil has now pronounced himself unhappy with the American reporting. From the estimable Globo news organization in Sao Paulo comes this report today:

CUIABÁ - North American pilot Joseph Lepore is testifying at this moment, by videoconference, in the trial which investigates responsibilities in the accident between the Legacy jet and the Flight 1907 Gol Boeing, which resulted in the deaths of 154 people in September of 2006. Lepore, who is in New York, responded to questions put by federal judge Murilo Mendes, of the Regional Federal Tribunal (TRF) of Brasília, and denied that any of the Legacy's equipment had been manually turned off during the flight. As was the case with copilot Jan Paul Paladino, heard this Wednesday, also by videoconference, this is the first time the pilot speaks to representatives of the Brazilian courts.

... During the [session], the magistrate showed himself to be very irritated with an article published by the American newspaper "The New York Times" about Jan Paul Paladino's testimony [yesterday].

Mendes considered the material to be "full of irony." The [article] cited the videoconference connection problems, saying that it was impossible to understand the Portuguese at some moments. The material also said that the case is treated as an obsession with anti-American sentiment. The judge, in today's videoconference, sent a message to the journalist for "The New York Times" saying that he "would not find work in a reputable newspaper in Brazil."

Well then.

Anyway, now that both pilots have testified, the judge's verdict is expected in April. The American pilots face up to five years in prison if convicted, but they cannot be extradited to Brazil under existing treaties. A conviction could, however, cause them grave difficulties in some international flying.

Nothing new came from the testimony yesterday and today, though the Brazilian media continue to quibble over the words "on" or "off," as heard once in the 290-page transcript of the cockpit recording on the Legacy. I've heard the muddy recording, and it's unclear to my English-language ears whether the word uttered is "on" or "off" -- but I also can't for the life of me see that this constitutes evidence of misfeasance or malfeasance either way.

The cockpit voice recorder, as has been known for two years, clearly confirms that Brazilian air traffic controllers instructed the American pilots to fly at 37,000 feet (where the collision occurred) -- routinely overruling a flight plan filed before the plane took off on its planned route from near Sao Paulo to Manaus. The flight plan routinely had the altitude at 36,000 feet at the point route where the two planes collided over the Mato Grosso in the Amazon. All pilots everywhere are required to follow air traffic control directions, which always take precedence over a pre-filed flight plan.

It is also not at all clear why the Legacy's transponder failed to send an anti-collision alert as the two aircraft approached each other at 37,000 feet -- but no evidence has been produced to indicate that the American pilots were at fault, let alone criminally culpable, in the matter of the evidently malfunctioning transponder. The charges that they were are based on conjecture.

Globo also reports today that American pilot Paladino "confirmed" that he had never flown a Legacy jet "before the accident that resulted in the deaths of 154 people who were aboard a Boeing Brazilian airline..." That's obviously not an accurate report, because Paladino and Lepore flew the same brand-new Legacy aircraft on a long test-flight from Embraer headquarters at San Jose Dos Campos on Sept. 28, the day before the crash. I know because I was on both flights.

Meanwhile, it is not in dispute by any serious aviation authority that both pilots were fully qualified to fly the Legacy type of aircraft, and had more than adequate experience to qualify on that type of plane.

On another matter, prosecutors and the Brazilian media have made much of a portion of the cockpit recordings that shows Lepore and Paladino speaking with some confusion about how to operate an unspecified piece of equipment during the flight. Actually, as all investigators are aware, that "equipment" they couldn't figure out how to work was the in-flight cabin-videoscreen system called Air Show. That's an entertainment device for the passengers and it had nothing to do with the operation of the aircraft.

I am also quite taken by Brazilian media choosing to continually make a point of the fact that the American pilots "do not speak Portuguese," and hence could have been culpable in not understanding unspecified verbal communications from Brazilian air traffic control.

One of the many serious criticisms made of Brazilian air traffic control, which is run by the military, has been that controllers there are not adequately trained and supervised, that equipment is outdated -- and that many controllers lack basic skills in communicating in English.

English, as the aviation world knows and universally agrees, is the required language of international aviation. Air traffic controllers and pilots the world over are required by international law to communicate clearly in English.

The reason for having a standard language in the world's skies is quite simple: Aviation safety, which was the critically important issue that got short shrift in Brazil four years ago, in the emotionally overwrought rush to scapegoat the Americans.

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2 American Pilots Testifying At Criminal Trial in 2006 Brazil Mid-Air Collision That Killed 154 Over the Amazon

The two U.S. pilots who flew the Legacy 600 business jet that collided with a Brazilian 737 commercial airliner over the Amazon in 2006 are testifying in their own defense today and tomorrow in a criminal trial being held in Brazil.

An investigation by the U.S. National Transportation Safety Board (NTSB) found that the probable cause of the horrific accident was operational errors by Brazilian air traffic control, which put the two airplanes on a collision course at 37,000 feet. But the Brazilians nevertheless charged the American pilots with criminal offenses.

The American pilots, Joe Lepore and Jan Paladino, are being tried in absentia in Brazil. Their testimony is being heard at a federal courthouse in Long Island, N.Y., via teleconference with the criminal court in Brazil.

The Brazilian prosecutors had initially demanded that the pilots testify at the Brazilian Embassy in Washington, but finally agreed to take testimony instead on U.S. territory, at a federal courthouse.

After the collision on Sept. 29, 2006, the seriously damaged Legacy jet managed an emergency landing at a remote Amazon airstrip, about 25 minutes after the 737 plunged into the jungle with 154 on board. I was one of the seven survivors on the business jet.

In a politically charged atmosphere at the time, the Brazilian military (which runs air-traffic control) and the federal police rushed to criminalize the accident, against the judgment of the international aviation community. A Brazilian investigation found some fault with air traffic control, but laid most of the blame on the Americans. The NTSB, which concluded otherwise, had the authority to conduct its own investigation in Brazil because an American-owned plane was involved.

Basically, the charges against Lepore and Paladino center on allegations, for which there has been no evidence produced, that the Americans turned off a critical piece of cockpit equipment called the transponder. The transponder triggers the aircraft anti-collision warning system that would have been the last possible chance to avoid the collision.

Catastrophic aviation accidents usually occur as a result of a chain of errors which typically come to light during an objective and lengthy investigation. Criminalizing an aviation accident is considered to be a mistake because it obviously impedes a thorough investigation, with key witnesses on the defensive.

There is no dispute that the Legacy's transponder was not operational for almost an hour before the crash, perhaps because of a malfunction. During that time, the aircraft was also mostly out of radio and radar contact, partly because of well-known communications "dead zones" over the central Amazon where the collision occurred. Aviation experts have said that a transponder like the one in the Legacy that goes off-line gives no obvious signal to the pilots that it isn't functioning.

Brazilian prosecutors are trying to prove their case that, for some reason, the American pilots turned off the transponder, causing the disaster. The pilots deny that they turned the device off, or were otherwise negligent in operating the airplane.

In testimony today, Paladino reiterated that, and said that he and Lepore followed Brazilian air traffic control instructions to maintain altitude at 37,000 feet during the flight from takeoff near Sao Paulo, diagonally across the Amazon to the planned destination, Manaus. The collision occurred about midway, over the Amazon state of Mato Grosso.

The Brazilians have charged that the American pilots ignored their flight plan, which called for routinely descending to 36,000 feet on the portion of the flight where the collision occurred. The American pilots have maintained that they were at the assigned altitude, and that under aviation protocols, air traffic control instructions automatically take precedence over a flight plan that is routinely filed well before takeoff.

Testifying today, Paladino noted that air traffic controllers commonly overrule flight plans. In the cockpit, "I rely on air traffic control," he said.

Lepore is scheduled to testify tomorrow.

After the crash, the pilots were held for two months in Brazil, and released only following an international furor about Brazil's handling of the incident. They, and several low-ranking air traffic controllers, were then charged with criminal offenses, which carry prison terms on conviction.

[Here's my initial report on the crash as it appeared on the front page of the New York Times. I later wrote a lengthier report in the Sunday magazine of the Times of London.]

Lepore, 46, is still a pilot with Excelaire, the Long Island charter company that had just purchased the $25 million Legacy jet in Brazil on the day of the crash. Paladino, 38, is now employed by American Airlines.

In a much smaller matter, I was sued for defamation in Brazil because of my own reporting and commentary on the crash. That reporting and commentary occurred in mainstream print, in television and radio interviews immediately after the accident, and subsequently on blog posts in which I argued forcefully against the Brazilian rush to judgment. During the two months after the crash, I also pressed for the release of the pilots from Brazil and severely criticized Brazilian authorities for what I asserted was a rush to scapegoat the Americans and cover up poor operational systems in Brazilian air traffic control.

Till Paladino's testimony today, I was the only one of the seven survivors who was able to speak publicly about the disaster.

The complaint against me falsely claimed that I had referred to Brazil as "most idiot of all idiots," among other demonstrably untrue allegations. The complaint, filed by the widow of one of those killed in the crash, rested on the assertion that an alleged insult to the honor of Brazil constituted an actionable injury against every citizen of Brazil. Till the lawsuit was filed, I had never heard of the plaintiff.

A judge threw out the suit last year, but the plaintiff's attorneys have appealed, and are also seeking criminal charges against me for alleged defamation of the nation. Last year, mostly because of libel-suit abuses in England but partially because of the strange Brazil libel case against me, Congress unanimously passed, and the president signed, a federal law that prohibits enforcement in the U.S. of foreign libel judgments that are considered to be an affront to the U.S. First Amendment.

I'll file an update tomorrow on the pilots' testimony. If convicted, the Americans are not subject to extradition to Brazil under U.S. law. But a conviction in Brazil would carry grave implications for a pilot who flies internationally.

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Want to Buy An Airline? Show Me the Money

There are a few half-baked reports around today saying that some investment company has "made an offer" or "a bid" to buy American Airlines (rather, its parent company AMR, to be precise). For an alleged $3.25 billion -- for a company that is worth $2.2 billion in market capitalization, as of the close of trading on Wall Street yesterday.

Actually, not many people seem to have heard of the investment firm, Sterling Global Holdings. And the "bid," so far at least, seems to be nothing more than talk and media speculation. Heck, you or I could send a letter claiming we plan to buy Google, right? All we need is the dough.

In this report, Terry Maxon at the Dallas News talked to Allen Weintraub, the general manager of Sterling Global Holdings, and Maxon asked the key question right off the bat:

Q. Do you have $3.25 billion?
A. Oh, we have more than that.

O.K. -- and sure, Donald Trump says he's running for president, too. Easy to say, since we're not at the point yet in the presidential primaries where a candidate needs to put up or shut up. It's all cheap publicity right now -- though some business reporters are starting to look into the alleged would-be AMR buyers a little more assiduously than most political reporters are looking into Trump's presidential "bid."

And it's easy to get the publicity machinery going over airline takeover bids that never quite materialize, as the media genius Trump himself knows.

Back in 1989, Trump got himself a lot of publicity by saying he had made a bid of $7.5 billion for AMR, though he also conceded that he had no commitments from banks to finance the "offer," which never came to fruition.

So show us the money.

P.S. -- and see this from a M&A law professors blog.



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Airline Capacity Growth Curtailed by Oil Prices

I'm just catching up to this important report in Business Travel News that airlines are planning to curtail their (modest) capacity-growth plans for the rest of this year.

According to the BTN report, American, United-Continental and Frontier this month "revised downward their 2011 capacity growth plans as crude oil traded above $100 per barrel." That follows Delta, which in February was the first major U.S. airline to cut back on 2011 growth plans.

[Here's the report on American's capacity plans, via Dow Jones.]

Unless air-travel demand falls off significantly, and there is no sign of that, capacity cuts mean that flights will be more full than ever. Meanwhile, service in many markets will be further reduced. That trend is exacerbated by the move to retire fuel-inefficient 50-seat regional jets, which are the mainstays of air travel in many medium-size and smaller (but even some major) markets.

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At the Gun Show in 'Baja Arizona'

Went to a gun show in Tucson yesterday, and here's the first thing we saw when we came in the door [photo, above]. Yikes! Nazi flags.

I went to the show with a young friend, a businesswoman who is a foreign-born Tucson resident. She was interested in purchasing a handgun for personal protection. She also happens to be Jewish. Guns and ammo are one thing. Nazi-era paraphernalia -- the real stuff, not replica material, incidentally -- is quite another.

On the other hand, to apply Andre Gide's maxim to Tucson, "please do not understand me too quickly." This being Tucson and not Phoenix, nothing is quite as pat as it might seem on first glance.

For example, at the same stall that had the Nazi flags on display, there was a cornucopia of military memorabilia, including scores of trays of insignia from U.S. troops in World War II, war medals from all over the world, and even a selection of antique postcards ... from places like Ocean City, N.J.

They also had used books, including one assessing the explosion of Nazi terror that followed the Reichstag fire in Berlin in 1933. So I was quite willing to regard the Nazi flags as nothing more than weird memorabilia -- though they did focus the attention right off the bat.

In fact, unlike at some gun shows elsewhere in the country, none of the books being sold at various tables seemed to be works of crazy right-wing extremism like the "Turner Diaries" copies often peddled at such events. One used book on display at one counter at the Tucson show: Tom Friedman's "The World Is Flat."

There also was a big display by volunteers who provide foster care for pets that U.S. military personnel need to leave behind for a year or so. (Tucson has a big Air Force base that deploys troops to Iraq and Afghanistan.). Here is the Web site for that group, which is called Operation Noble Foster.

There were tables upon tables piled up with surplus military gear, including camouflage jackets and boots. It occurred to me that we have not been at war for so long that surplus GI equipment is flooding the market, much as it did in the 1950s, when massive quantities of World War II gear was sold at retail shops called Army-Navy stores.

Naturally, there were thousands of weapons of all kinds for sale at the gun show. My friend got very informative, sensible advice from reasonable gun experts on what to look for in a personal handgun, and how to assess things like recoil.

All of the gun dealers we spoke to, by the way, said they required a background check and paperwork for any sale.

Outside in the parking lot were only a handful of cars, pickups and SUVs with blatantly extremist bumper stickers. There also were a few with "Proud To Be a Tucson Democrat" stickers. One SUV had Fraternal Order of Police sticker and National Rifle Association stickers on the front bumper, and stickers that said "Keep Your Theology Out of My Biology" and "Obama '08" on the rear bumper.

Most of the people at this weekend's gun show (they occur throughout the year), sponsored by a company called Roadrunner, seemed like normal citizens. On the other hand, there was a couple circulating the exhibition pushing a baby carriage with an infant in it, and propped beside that infant, literally tucked into the swaddling clothes, was a rifle with its barrel sticking up. The mother told me the baby was two weeks old.

But rather than crazed and dangerous extremists, the hapless couple just struck me and my friend as amiable chowderheads, proud of their tiny, red-faced infant -- who was, we agreed, adorable, despite having to share his baby blanket with Daddy's brand new rifle.

So as always, and especially in a place like Tucson, impressions made in a flash, or through easy stereotypes, are usually not accurate impressions. At least here in what the locals have begun to call "Baja Arizona," to distinguish it from the nut-farm territories up north in Phoenix.

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Continental Adding WiFi Next Year on 737s and 757s

Continental Airlines finally has committed to inflight WiFi, saying today that
it's going to to install the service on 200-plus 737s and 757s on domestic routes starting next year.

As I noted many months ago in assessing Continental's plans, the provider is LiveTV, offering WiFi via Ka-band on aircraft with DIRECTV, which also has 95 channels of live television programming. Ka-band will use ViaSat’s ViaSat-1, which will be the world’s highest-capacity satellite after it is launched later this year.

"Ka-band will be able to offer higher transmission speeds for more extensive onboard connection capabilities, including browsing of content-rich websites, sending and receiving e-mails and downloading files," says United Continental Holdings, the somewhat clumsily named corporation that now owns the merging United Airlines and Continental Airlines. (Well, thank God they didn't name it "Uncontinental," at least).

United Airlines currently offers inflight Internet service on 14 aircraft, including on its so-called p.s. premium service flights between Kennedy with Los Angeles and San Francisco.

On those flights, United uses Aircell's industry-leading Gogo WiFi service, which is installed on almost 1,100 mainstream domestic aircraft.

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Airlines, Please Spare Me the Song and Dance

Listen, no good comes of having anyone "perform" or otherwise behave on an airplane like those New York street people who used to wait till the subway train left the station and then stand and loudly demand your attention on behalf of one cause or another.

We're captive audiences here, airlines. I know civility is at a minimum in air travel, but please, let's put a stop to this trend of staging creative "entertainment" in the aisle, instead of calling attention to the standard, boring and very important recitation of the flight safety procedures.

Up there is John Travolta, intruding in a supposedly entertaining video on Qantas flights, for example. [UPDATE: The embedded link to the video has mysteriously disappeared, and I have replaced with a screen grab]

Now, I know that Travolta is a skilled private pilot himself, but what if I don't want to have to be forced to attend a Travolta performance on an airplane?

I see this guy and the first thing I consider is that he believes that we are engaged in a battle with Xenu, the ruler of a galactic confederacy 75 million years ago, who is in league with vile psychiatrists and has devised an evil plot to ... oh, screw it, the man is a prominent Scientologist. Instead of listening to safety information that could save my life, I'm going to be fixed on how anyone as smart as this guy seems to be can buy such crap. What if he tries to sell me a book when I am supposed to be learning where the floatation device is located?

Qantas flight crews are said to be unhappy with the Travolta video in lieu of the actual safety demonstration by flight attendants, and I don't blame them.

Where I do blame flight attendants is on airlines that encourage them to sing and/or dance the safety demonstration. Or to in any other way engage in performing live entertainment for a captive audience.

Yes, this seems to be a trend.

Capital Airlines now does it, following Cebu Pacific's allowing flight attendants to sing and dance the safety demonstration to a loud Lady Gaga song.

You know what? If Lady Gaga did it herself on a plane, I (and I suspect many others) would tell her to sit down and shut the hell up.

Southwest Airlines, meanwhile, has encouraged some flight attendants to do the safety demonstration as a rap song.

At this time, please listen up, flight attendants and pretend airline captains. Most of us don't care to be forced to watch a performance, and a cringe-worthy one at that. Lots of us, believe it or not, have never even seen reality TV, and have no desire to see a version of it on an airplane.

Kindly save the song and dance routine for karaoke night at Olive Garden, on your own time, please. Meanwhile, where are those exits again?

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The Perils of Travel Magazine Journalism...

You've got to feel for editors of those slick monthly travel magazines, commissioning all those twee, relentlessly positive stories on places all over the world -- and then having local conditions abruptly go to hell in one, while the magazine is already at the printer's or merrily on its way to subscribers' mailboxes and newsstands.

Consider Conde Nast Traveler, which had a rah-rah story in its February issue, "Egypt: Secret Pleasures of the Nile." Alas, notes editor-in-chief Klara Glowczewska in her "Editor's Letter" at the front of the April issue, the February issue was arriving on the newsstands "right around January 25" -- just as revolution was breaking out on the streets of Cairo.

But you also gotta hand it to travel magazine editors for looking on the bright side of life, as is their wont. The Egypt story "all seemed like spectacularly bad timing," Glowczeweska writes in the April issue, as "elements of the old regime were ready to sacrifice Egypt's vital tourism industry to stay in power, allowing the Internet to show mobs (government-sponsored thugs, we now know) attacking foreigners and riding horses and camels through Tahrir [Square] ..."

But yet, look on the bright side! The editor's note quotes the author of the earlier Egypt story, now brightly suggesting that, post-revolt, Egypt offers "an opportunity to witness history being made..."

To which the editor exults: "Indeed. Good morning Cairo!"

As I said, this all is contained in the April issue of Conde Nast Traveler -- the one with a story titled "The 15 Best Places to See Right Now."

And place No. 10 on that list is (wait for it) ... Libya.

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State Department: Avoid Travel to Japan

As the post-tsunami conditions worsen in places, as the nuclear-plants crisis continues, and with reliable emergency information difficult to come by, U.S. citizens should avoid travel to Japan at this time, the State Department said in a travel alert issued today.

Here is the full text of the State Department travel alert for Japan, issued today.

Excerpts:

"The Department of State requests all non-emergency official U.S. government personnel defer travel to Japan and urges U.S. citizens to avoid tourism and non-essential travel to Japan at this time. Temporary shortages of water and food supplies may occur in affected areas of Japan due to power and transportation disruptions. Telephone services have also been disrupted in affected areas; where possible, you may be able to contact family members using text message or social media such as Facebook or Twitter.

Flights have resumed at all airports that were closed by the earthquake, except Sendai, Sado, Iwate-Hanamaki, and Misawa Airports. In Tokyo, most public transportation including trains and subways are operating. Many roads have been damaged in the Tokyo area and in northern Japan, particularly in the Miyagi prefecture where government checkpoints have been established on damaged roadways. In Iwate Prefecture, toll road highways are restricted to emergency vehicles only. ..."

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