May 162014
 
The incredible shrinking US airlines.  See article, below.

The incredible shrinking US airlines. See article, below.

Good morning

A couple of happy birthday notes this week, the older first.

It is 60 years ago since the Boeing 707 prototype first rolled out of its hangar.  The 707 can be said to mark the transformation of aviation from the elitist era of smaller slower planes with comparatively limited range and much higher costs per tickets, and the new jet age – safe, comfortable, fast and convenient air travel for everyone.  Today, sixty years later, we still have safe air travel, but planes are slower than the 707, much less comfortable, and the overall travel experience decidedly less convenient.  Progress is such a fickle thing.

The 707 prototype was named the Model 367-80.  The 367 was an invented nomenclature that perhaps, on the basis of 3+6 = 9, hinted at the plane’s origins, the C-97 Stratofreighter, and the -80 means it was the 80th design in the development series.  When it appeared, it was an enormously bold move by Boeing – they developed the plane without a single up-front order, and still had none when the ‘Dash 80’ (as it was popularly termed) was rolled out 60 years ago.  The boldness of this move is all the more apparent when you realize that this was the second attempt at a passenger jet – an earlier model, the 473-60, was a total failure and didn’t win any airline orders at all.

But Boeing’s confidence in the plane was validated.  It went on to sell 1009 units, plus another 732 to the US Air Force as tankers – some of which are expected to remain operational all the way to 2040.

It is interesting to appreciate that when this plane was rolled out by Boeing, it was at a point where Boeing essentially had absolutely no commercial passenger planes at all.  Instead, the brand to beat was Douglas, which at the time not only still had thousands of DC-3’s in the air, but also many hundreds of DC-6s (still in production then) and DC-7s (also in production), to say nothing of the lovely Lockheed Super Constellation too.  Boeing’s most recent attempt at a passenger plane, the 377 Stratocruiser, was a failure, and only 55 were built, of which only about 41 went into commercial airline service.

In addition, Douglas was also at work on its own jet, the quite similar DC-8, and although it got to market three years later, until 1958 both Boeing and Douglas were more or less equal in orders for their two planes.  However, the 707 soon took over the market, and ended up outselling the DC-8 two to one.

Did this mark the pivotal moment when Boeing leapfrogged over Douglas, Lockheed, and other less well-known airplane manufacturers to become the world’s most successful airplane manufacturer?  Quite possibly, although of course its initial momentum from the 707 was boosted by the enormous success of its 727, 737 and 747 programs as they unfolded in the 1960s.

Think of that.  In little more than ten years, Boeing went from zero passenger jets and zero market share, to four totally different models – all extraordinary successes – and owning the majority of the market.  Talk about ‘the good old days’, indeed!

Or, perhaps, not so old.  Two of those planes from the golden days of the 1960s are still in production today (the 737 and – although only just hanging in there – the 747).

Here’s an interesting retrospective on this watershed moment, and here’s a fascinating article from May 1954.

Now, for the second birthday, flash forward a mere 20 years, and in 1974, another epochal event occurred.  New company Airbus delivered its first ever jet, and it wasn’t just any old jet, it was also the world’s first ever twin-engine wide-body jet, the A300B.

Today, twin-engine wide-bodies have almost vanquished all four-engine jets (only the A380 struggles to stay as a viable option, with the 747-8 all but moribund), but 40 years ago, it was another brave and bold move.

It is easy to forget, at the time of Airbus’ founding, in the late 1960s, that starting another airline company at that time required very large sized cojones.  Boeing was sweeping the board with its planes, and had vanquished all European competitors, and was in the process of doing the same to its American competitors, too.  Concorde had pretty much destroyed its British and French parents.

To start a new company in competition with Boeing – a company that had knocked four home-run hits out of the field in a row with its 707, 727, 737 and 747 planes – each and every one revolutionary in its time and an extraordinary success – and to do so with another brave new design, too, actually took considerable bravery (or should one say ‘substantial government backing’?).

No-one can deny that the rise of Airbus has not been a plus to the industry as a whole, and has helped keep at least some slow development of new airplane types proceeding, albeit at a snail’s pace.

Here’s a quick background on Airbus and its first 40 years.

Talking about watershed events that happened long ago in the past, it is now ten years beyond the date that Sir Richard Branson said would see a reusable rocket taking up to ten people at a time to his orbiting ‘Virgin Hotel’.

Now of course, the orbiting hotel has been quietly forgotten (and the entire world can barely manage the ISS, with only one nation able to fly to it, and that nation – Russia – now deciding it may discontinue its involvement in 2020), and the notion of any sort of orbiting hotel seems sadly even more fanciful today than it was when the movie ‘2001 A Space Odyssey’ came out in 1968.

As for the reusable rocket, that has now scaled down to six passengers, and rather than taking its passengers to an orbiting hotel, it will instead merely do a brief sub-orbital flight.

When will this now happen?  Your guess is as good as mine, and whatever you do, don’t look to Sir Richard Branson for any meaningful advice as to when to expect it.  In January he was predicting flights this summer, and as you know, next weekend marks the traditional start of our summer season.  He is now saying that he would be ‘very very disappointed’ if the flights don’t start this year, whatever that means.  As too probably will be the 700 people who have already paid deposits on their tickets.

Here’s a fascinating timeline of broken promises and fanciful projections by Branson.  Please don’t get us wrong.  We admire the audacity of hope inherent in Branson’s concept, but we do wish it were layered with a more reliable and realistic set of promises and accomplishments.  A bit like a different audacity of hope….

Are we eager to ride his spaceship ourselves?  We’re more sympathetic to William Shatner’s perspective.

Meanwhile, Branson is boldly telling people ‘After we’ve done the space program, we will be producing supersonic planes, which will go far, far, faster than Concorde’.  He is promising 19,000 mph, and less than an hour for New York to Tokyo.  Will any of us be alive to see that, I wonder?

Actually, quite possibly yes.  But few of us would afford to fly it.  It seems that this super fast plane is simply his sub-orbital ‘spaceship’, repackaged and repurposed.

People sometimes ask me why I started The Travel Insider, and what its prime purpose is.  My reply is first to suggest there are multiple purposes – with the internet, why limit yourself to only one.  To answer the question head-on, it has always been my intention to provide a more fully informed commentary than so often is found in the main stream media.  Whether it is in the form of replacing inappropriately gushy reviews with more realistic reviews that point out product weaknesses as well as strengths, or responding to articles that are little more than one-sided press releases; these are the things that give me greatest pleasure.

So you can imagine how pleased I was to write a piece this week that looks at an article boldly headed ‘Why You Should Pay Frontier’s Carry-On Bag Fee’ in the NY Times.  Although the article actually is not really about the Frontier carry-on fee at all, it makes a very brave claim – that we shouldn’t complain too much because we are still getting close to the best deal we’ve ever had when it comes to air travel.

Well, talk about a red rag to a bull!  You can read my response in the article below.

There’s another article as well, this time exposing some more of the ugly under-belly of TripAdvisor and its review/rating system.

New Zealand has been in the news a bit this week.  Their government has just announced their latest budget, with a surplus instead of a deficit (remember those?), and New Zealand scored as the most desirable ‘dream’ destination in the world to visit if money were no object in this survey.

Talking about money being no object, here’s a 40 day tour being offered to people who wish to have a high-end drinking experience.  How high-end?  Ummm – $1.27 million worth of high-end!  Details here.

Now to tie these two seemingly unrelated threads together, did you know you don’t need to spend $1.27 million to enjoy some of the world’s best wines, and you don’t need to have a requirement that money be no object before going to New Zealand.

Our October 2014 New Zealand Epicurean Extravaganza offers you the best of New Zealand – the country and its wine and food – for a mere $3000.  We have, I believe, a wonderful balance between common tourist experiences and uncommon ‘Travel Insider enhancements’, between free time and organized experiences, and plenty of chances for plenty of gourmet food and great wine.

So why not consider joining 18 of your fellow Travel Insiders on what promises to be a wonderful experience in a lovely country.

Although all Travel Insider tours are always good, I like to think that on the very rare occasions I take you to my home country of NZ, that is an extra special experience, for both you and me.  I hope you’ll decide to join me and a great small group of fellow Travel Insiders, this October.

What else this week?  Please read on for :

  • MH370 Underwater Search Was Less Thorough than Expected
  • What Does an Airline Do When a Country Refuses to Pay It?
  • Southwest – ‘We Have More Opportunities than We Have Planes’
  • A Reason for the Opportunities Southwest Sees
  • More Proof that Fewer Airlines Means Higher Fares
  • Premium Economy Comes to Singapore Airlines
  • A Terribly Bad Idea
  • A Really Bad Idea
  • A Dubious Idea
  • Amazing Hotel Designs
  • Does the US Have a ‘Hands Off’ Terrorist List?
  • And Lastly This Week….

MH370 Underwater Search Was Less Thorough than Expected

Here’s an article from the WSJ that is interesting two different ways.  First, it confirms part of my comments last week that the apparent black box pings were perhaps not from the black boxes at all, although this admission is filtering out slowly rather than positively.

The other interesting point in the article is buried towards the bottom of it.  Remember when we were getting daily progress report after each Bluefin-21 search dive, and then we were told the search was ‘complete’ with nothing found?  Well, it seems that ‘complete’ is a relative rather than an absolute term, and in the region deemed to be the most likely zone where the plane – or at least its black boxes – might be found, only about two-thirds of the area could be searched, due to the uneven nature of the ocean floor making it difficult/impossible for the Bluefin to survey the balance of the area.

So – the search has been completed?

(If you can’t open the WSJ link, try searching for its headline in Google – that usually brings up an unblocked WSJ link).

What Does an Airline Do When a Country Refuses to Pay It?

Alitalia announced this week it was discontinuing service to Venezuela.

The problem is that the country requires international airlines to sell their tickets in local Venezuelan currency (the bolivar) but is not allowing airlines to then convert the money to any currency of international value and move the money out of Venezuela.

Apparently the country owes some $4 billion in total to airlines, and so Alitalia has declared ‘enough’ and is ending service due to not being able to get its money out of Venezuela.

The Venezuelan president has asked airlines to trust his country’s promise to allow them to get their money out of the country at some point in the future, but to be patient in the meantime.  And he has also threatened to deny any airline that stops flying to Venezuela the right to subsequently return there when the country’s troubles are at an end.

AA and DL continue to fly there, as do other international airlines such as Lufthansa.  Air Canada stopped flying in March, but claims this was due to ‘security concerns’.  Their ‘security concern’ claim didn’t work, and Venezuela has now severed its relationship with AC.

Details here.

Southwest – ‘We Have More Opportunities than We Have Planes’

Southwest is feeling very bullish about its future, in part due to the expiry of the Wright Amendment limitations on where flights can go from Dallas/Love Field, scheduled for 13 December this year.

Southwest plans to add flights from Love Field (airport code DAL – perhaps it is one we’ll increasingly need to recognize) to 15 new cities once the restrictions are lifted.  We expect that these flights will generally be to cities it already has a presence in.

But Southwest also says it plans to add service to ‘up to’ 50 new destinations over the next ‘few years’.  It sure sounds good, but as we well know, ‘up to’ includes all numbers less than 50, and ‘few years’ is a very vague sort of time frame.  The airline has already hotted up an excuse if it fails to meet these vague targets, when CEO Gary Kelly said

We have more opportunities over the next five years than we have planes.

If that is indeed so, perhaps he might choose to buy a few more planes – or at the very least, cancel the delivery deferrals that Southwest announced last year.  That would definitely delight Boeing, particularly because there are some nasty whispers in the background that the order books for both Boeing and Airbus have some soft orders that are likely to be cancelled sometime between now and whenever the planes would otherwise be delivered.

While Boeing sort of has a six-year backlog for 737 orders – more than 3000 are on order, and it is producing them at a rate of 42 a month – it can probably also supply some planes at short notice.  This is because its backlog isn’t like, eg, a Tesla backlog, where you have thousand of impatient buyers all wanting their cars asap.  Instead, with Boeing (and Airbus), an airline will order planes with a preplanned and staged set of deliveries.  The last thing any airline would ever want is to suddenly have half a dozen new planes dumped in its lap, without all the many complex additional things needed to instantly start making money from the planes all in place.  So the backlog is patchy rather than solid.

So, go ahead, Southwest.  Put your money where your mouth is, and don’t let your claimed shortage of planes limit your ability to take advantage of the opportunities you say you have.

Details here.

A Reason for the Opportunities Southwest Sees

You don’t have to be a rocket scientist, or even an airline executive, to see the opportunities that Southwest is hinting at.

As you can see in the image at the top of the newsletter, in 2005, the airlines operated a total of 11.56 million flights (an average of 31,700 every day).  In 2013, the airlines operated 9.73 million flights (ie 26,650 flights a day).  That’s almost a 15% reduction in flights, even though passenger numbers are very slightly up in 2013 compared to 2005 (743 million in 2013, 739 million in 2005).

Surely it is time for Southwest to try out its famous ‘Southwest effect’ once again.  This is the name given to the phenomenon that has been demonstrated countless times in the past, by Southwest and other airlines, that when a new airline appears and starts offering more flights and lower fares, the number of passengers flying the route massively increases.

Who among us, today, hasn’t cut back their flying over the past some years?  And who wouldn’t consider more flying again in the future if we had more flights to choose from, and lower fares to purchase, and perhaps even the tantalizing hope of not getting crushed into a middle seat once we boarded the plane?

More Proof that Fewer Airlines Means Higher Fares

airfaresbThey say a picture is worth a thousand words.  So here’s the thousand word picture, which also perhaps encapsulates another reason why Southwest sees so many opportunities out there.

Here’s a link to the article, and a larger/clearer image.

We wonder what the DoT and DoJ think of this chart?  How can they reconcile it with their steadfast enthusiasm for airline mergers being ‘consumer friendly’?

Oh – you might be wondering – why do international airfare prices not drop as low as domestic?  That is because, even with very many airlines apparently operating a route, we’ll wager that in truth, all the 14+ different airlines apparently operating flights are actually only three or four carriers (one each for the major three alliances, possibly with a wild card or two such as Emirates) and a bunch of codeshares.

International air travel, with its additional overlay of much higher costs of entry and government restrictions on access to markets, are less competitive in all respects than domestic markets.

Premium Economy Comes to Singapore Airlines

It puzzles me how airlines are very selective at adopting the Premium Economy cabin concept.

To my way of thinking, it marks a logical ‘next step’ in the evolving cabin strategies of most airlines.  Business class has become so good that it is displacing first class at many airlines, and coach class has become so bad, leaving a huge gap in the middle that cries out to be bridged.

It is amusingly close to correct to say that today’s business class is similar to (or better than!) first class of a couple of decades ago, and today’s premium economy compares favorably to business class back then.

As for present day coach class, it compares to nothing at all.

But, with all that as introduction, it is great to see Singapore Airlines now embracing the premium economy concept.  Indeed, it is doing much more than that – it will be spending US$325 million to upgrade all cabins on its 19 777 planes (yes, that’s an amazing $17 million per plane).

A Terribly Bad Idea

This week saw the launch of a new service that allows people to text messages to 911 rather than requiring them to call in emergency calls the ‘old fashioned’ way, by voice over a phone line.

Now we’re as much devotees of technology as anyone else, but this is a terribly bad idea.  If you’ve ever been in a 911 call center, or if you’ve even simply listened to a 911 recording, you’ll know that a 911 call is interactive, and that the caller, often in a state of distress and in a very time-pressing situation, needs to be carefully ‘talked down’.  If there is a medical emergency, the dispatcher needs to get information about the victim’s condition, and might be able to give some emergency care advice.  If it is a police matter, the dispatcher needs information on the suspects.  And so on.  If it is a fire, then they need to know where the fire is, how developed, if there are people in the building, dangerous goods, and so on.

When this is done by phone, it proceeds at the normal speed of conversation, 150 words per minute being a normal sort of speed, and 200 wpm if you’re agitated, and it is easy for one person to interrupt the other if needed.  If it is done by text message, well, how fast do you type text messages on your phone?  And the other person can’t interrupt you, because they don’t know what you’re typing until after you’ve sent it.

If it is by phone, the dispatcher can hear the sounds in the background, and the degree of anxiety in the caller’s voice.  They can probably tell the difference between a prank call and a real call.  By text message, none of that is possible.  If by phone, you can put it on speaker phone, and you can be doing other things at the same time, like caring for a victim or whatever.  By text, you’re focused on the screen and typing.

No-one in their right mind should ever text to 911 when they could call instead.  The new texting ‘service’ is actually a grave disservice and should be ended.

A Really Bad Idea

Do you stream Netflix or other online video to your home television these days?  More and more of us do, and we are streaming at ever-increasing data rates too so as to enjoy the rather optimistically branded ‘HD’ streaming experiences being rolled out by Netflix and its growing number of competitors.

It used to be that low quality video streamed at 0.3 GB per hour.  That was superseded by ‘standard’ quality video, at 0.7 GB an hour, and the last year or so has seen ‘HD’ video at 3 GB an hour.  The new 4k video runs at 7 GB/hour (15.5 Mb/sec).  A two hour movie – formerly requiring anywhere from 0.6 – 1.4 GB, will now require up to 14 GB to watch.

One of my concerns has always been that sooner or later, our ISPs will start capping the amount of data we can transfer each month, and charge us if we go over that limit.  We’ve seen how ‘unlimited’ internet on our phones has been redefined under a ‘reasonable use’ policy – a suitably Orwellian term which actually means ‘unreasonable restrictions on what we sold you as unlimited, but now we will blame you if you try to use it as we promised and sold it to you’.  We’ve seen Canadian ISPs experimenting with monthly data caps, and some other countries have such things as normal.

The US already has some of the slowest broadband speeds in the world, and some of the more expensive monthly connection fees, and now it seems, data caps are just around the corner for us, too.

Comcast – about to become even bigger after merging with Time Warner Cable – is opening talking about how, within five years, all its customers may find themselves with caps on their internet data usage.

This is particularly rich because only a couple of months ago Comcast managed to bludgeon Netflix into paying it money to stop Comcast from deliberately and gratuitously slowing down the speed of Netflix video streams.

So, in a manner that even an airline executive must truly envy, Comcast hopes to charge both sides from its vantage point in the middle.  It is already charging Netflix for the movie you’re watching to reach you at a reasonable speed and quality, and now it wants to charge you for watching it, too.

Apparently the lack of competition in the ISP/last mile field is just as damaging as is the lack of competition in our airlines.  And again, we find ourselves wondering how is it that two things the US used to beat the world at – the internet and business competition – are now things we are performing so dismally at.

A Dubious Idea

General Motors.  General Mills.  General Electric.  General Tours.  There was a time when being ‘General’ something was a good idea, and denoted substance.  We’re not sure if that remains a current scenario or not, but the current owners of General Tours apparently feel their name is past its use-by date.

The company was founded in 1954, initially offering tours to the then Soviet Union.  Nowadays it offers reasonably high-end touring around much of the world.  It announced this week it would now be known as Alexander+Roberts, saying that the new name is ‘intended to align the customer closer to the product’.  Say what?

I’ll agree that ‘General Tours’ is a fairly stolid name, but Alexander+Roberts?  Sounds like the name of a brand of hairspray or something like that, not like a touring company at all.  Also sounds like a company that envies the brand success of Abercrombie & Kent…..

One wonders how much General Tours spent on the research firm they engaged to come up with the rebranding.

Amazing Hotel Designs

I’d thought I’d add a picture from one of the hotels featured in this pictorial, but I couldn’t decide which one to offer, because so many of them are so extraordinary.

Most extraordinary of all, though, is that they are all in China.  I can’t say this enough – we need to enormously recalibrate our appreciation of China.  It is no longer a backward country, but rather a world leader and a world beater in more and more of the fields that we used to complacently consider ourselves pre-eminent in.

Does the US Have a ‘Hands Off’ Terrorist List?

There are few things worse than getting your name on one of the several different terrorist watch lists that the US government maintains.

We don’t know much about these, other than occasional hints that suggest the number of people on the lists is enormous – one list, by December 2012, had grown to 875,000 names alone.

We do know that many unfortunate and innocent people of exemplary background and character, including even professional pilots, get savaged by getting incorrectly added to one of these lists.

But did you know there may be another list – a ‘hands-off’ list of terrorists who are ‘well connected’ politically?  While being a senior politician of a friendly country (or even of the US itself) does nothing to stop the TSA doing their very ‘best’ to harass you; according to this article, if you are a well-connected terrorist from an unfriendly country, you might end up with carte-blanche to come and go as you like.

And Lastly This Week….

The ‘Apple of toilet tech’?  Apparently that’s the boast of Toto, a Japanese company that takes things to what we in the west might consider an illogical extreme.  And which also illustrates another of the pleasures and sometimes surprises of travel – never quite knowing what to expect when going to the ‘small room’.

I’m always fascinated with ways to make coach class travel more comfortable, and over the years, have bravely experimented with very many different things that have had the potential to make travel more comfortable.  Some have worked well, and others are best quickly forgotten about.

Here’s something that you’d never see me use, however.  What a terrible concept.

Here’s a fascinating video – there is a slice of it in this article, and at the end of the article, a link to the entire video.  A person traveled around London, finding the exact same vantage points from which to shoot video as had been used to shoot movie footage 90 years before.  He then overlaid part of the old video on top of the new video.  It is interesting to see how little has changed, yet simultaneously, how much has changed.  Plus ça change, plus c’est la même chose?

Truly lastly this week, another video.  I surprised myself by watching it all the way through, and it gave me a chance to pause and think about how we take so much for granted in our frequent flying lives.  But I also found myself massively bemused by the two elderly ladies featured in the video – they have never flown before, but are deploying iPads with a casualness presumably based on familiarity.  You’ll find the video unexpectedly heartwarming.

Note that I’m not quite sure where I’ll be next Thursday/Friday, so not too sure about what type of newsletter will emerge next week.

Until next week, please enjoy safe travels

Davidsigblue285

 

David.

 

 

 

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