Weekly Roundup, Friday 21 June 2019

Good morning

Happy 100th anniversary this week to trans-Atlantic air travel.  Most people don’t even know it was John Alcock and Arthur Brown, two British fliers, who completed the first trans-Atlantic flight, traveling east from Newfoundland and ending rather ignominiously in a peat bog in Ireland.  Details here.

The redesigning continues apace.  Last week, the summary versions of the newsletter were going out in full text form, and while I hope for better things this week, I fear they may go out in full text again.  But I’m assured by the mailing service company that progress is being made.  I also discovered that one of the six newsletter versions wasn’t going out at all!

A repeat message to people who get the newsletter through the Google Feedburner service rather than through the Feedblitz service.  We can’t control the Feedburner formatting, and with Google having turned its back on Feedburner some years ago, it is unlikely Google will be updating/improving it.  You might want to consider getting a Feedblitz copy instead, from this link.

Please let me know if there are other issues that exist.  It is hard to test newsletters, due to so many different combinations of email service, mail browser/reader, phones, tablets, computers, and so on, and I’m relying on you to point me to what needs changing.

My love affair with my Apple Watch continues unabated, even though it continues to nag me relentlessly about how “Just 8 more minutes of exercise will enable you to meet your goal today”.  But isn’t that what the loved ones in our lives do – encourage us to become better than we are?  It is a bit sad though when “the loved one” is a watch…..

Seriously though, I do feel it has greatly improved my health awareness, and some of its other features and services are useful in small ways.  As I think I said last week, the Apple Watch is definitely a case of something where the whole is greater than the sum of its parts.

I had a frustrating run in with Amazon this week, and while I find stupidity never easy to stomach, what really over-exercises my gag reflex is when I’m lied to, by both front line call agents and their supervisors too, and when “real” managers refuse to take my call or to call me back.  For more details, please see the article that follows this week’s roundup.

What else?  Please continue on for :

• Last Call for Scotland; France and Christmas Still Open
• Boeing Breaks its Two Month No-Order Spell – Sort Of
• This Week’s Bad News for Boeing
• The Two 777 Mysteries
• A Rose by Any Other Name?
• Airbus Announces a Longer Range A321
• Excellent Advice :  What You Must Do When Complaining to an Airline
• Of Ducks and Roller Coasters and Prisons – aka Cruise Ships
• And Lastly This Week….

Last Call for Scotland; France and Christmas Still Open

We’re at the point now where if you’re going to join us in Scotland this mid September for our lovely tour around the backroads of quintessential Scotland such as regular visitors never get to see, you probably should now do so.  It is not quite three months away – I guess I better buy my own air ticket soon!

Our lovely Loire Valley, plus Normandy/Brittany, the Channel Islands, and optionally other places too tour for later in September is also coming due to a decision point fairly soon.  Maybe you’ve rushed through a Loire Valley chateau before, but have you really put down roots in the region for a nice extended stay and felt part of it?  Here’s a chance to get more into the reality of France.

It is still a fair while until early December and our Christmas Markets “Landcruise” of course, but these things have a habit of creeping up on us more quickly than we expect, and particularly air fares around the Christmas season are best confirmed well in advance.

We’ve one couple who are so keen they’re considering staying on longer and adding a bit of last year’s French Christmas tour too!  This should be a really great tour, and I hope – whether your first European Christmas Markets tour, or another one of many – you might choose to come along and enjoy it with some fellow Travel Insiders.

Boeing Breaks its Two Month No-Order Spell – Sort Of

As I’d predicted last week, Boeing’s two dry months in April and May ended at this week’s Paris Air Show, but with the nature of what some people initially hailed as Boeing’s major triumph being unclear and open to interpretation.

To everyone’s astonishment – most of all, Airbus – Boeing surprised the world by announcing a letter of intent from the British Airways’ parent company, IAG, which said that it intends to buy 200 737 MAX planes.

There were many surprising elements in this announcement, not the least of which being that BA/IAG, while it has larger Boeing planes in its fleet, has been exclusively sourcing its single aisle planes from the Airbus A320 family.  A switch like this from one supplier to the other by a major airline is always a surprise, and what makes it truly astonishing is that Airbus claims not to have even known BA was looking to buy more single aisle planes.

This is very surprising for several reasons.  Airline manufacturers are very close to their large customers, and it is hard to understand how Airbus could have been so blind-sided as not to realize that BA needed 200 new planes, with deliveries requested to start as soon as 2022.

But more than this, it is really strange bargaining on the part of BA to go to Boeing and negotiate a “best price” for the 737 MAX without also going to Airbus and seeking an ever better price to continue buying A320s.  It is a classic approach to use each side to help you negotiate down the other side.

However, while these points are true, it is also incontrovertible that it was a huge boost for Boeing.  There is probably nothing that could have done better to give Boeing some desperately needed marketplace support than to announce a huge new deal with a major airline that is not only showing its confidence in the 737 MAX, but is switching its solid allegiance from Airbus to Boeing in the process.

There are other smaller surprises within this announcement too, and it is also worthy to note that this was not an order.  It was a letter of intent; which is far from a contractual commitment to do anything.  It is a bit like you meeting someone at the pub, and at closing time, inviting them back to your place “to look at your etchings”.  You hope that more will follow, and there’s a high probability it will, but nothing has been promised or guaranteed.

Back to the unilateral negotiation between BA and only Boeing, excluding Airbus entirely.  A fascinating topic for speculation which may never be clearly resolved, other than inadvertently by error (as sometimes happens), is what sort of price and discount BA will have secured in return for this almost life-saving move on its part.  What could have been such an impossibly amazing deal from Boeing that there was no point in even at least giving Airbus the courtesy of attempting to respond?

The expectation is that BA will have negotiated at least a 65% discount off the list price.  Sure, it is unusual for any airline to pay the full “second sticker price” on a new airplane, and we guesstimate that most airlines get 30% – 40% off the list price, with some getting better than a 50% discount.  But to get 2/3 or more of the cost price taken off is very rare.

That’s not BOGO, it is BOGT – Buy One, Get Two (more free).  What type of credible business, anywhere, gives 65% discounts off its list prices?

There’s another twist to pricing as well – a twist that makes it difficult for Boeing to be too generous, although there are ways around that for sure.  Boeing has several times entered into agreements with airlines that they will be given Boeing’s lowest/best price on the planes they buy – sometimes referred to as “Most Favored Nation” deals.  This type of agreement says that if Boeing ever gives a better deal to another airline, then Boeing will refund back to the Most Favored Nation airline the extra amount that it had paid on its airline purchases.  (We understand that Expedia has sometimes secured similar deals with hotels and their room rates.)

So some airlines are probably hoping that BA did secure a new record breaking discount, because the benefit will flow to them as well.

But we wonder how enforceable such MFN promises are.  Can the price that Airline A contracted for a plane two years ago and obtained delivery of one year ago be equated in any form to the price that Airline B agrees to for a plane today and receives a year later?

How do you adjust for different options and versions?  For payment terms and financing?  And, increasingly, how do you cost in and factor for other “sweeteners” that are increasingly included with a deal like extended warranties, spare parts and servicing contracts?

While these terms and details are all very commercially confidential, we guess Boeing has to be reasonably fair in its marketplace dealings, because while today it is dealing with Mr A, who is buying airplanes for Airline X, next year Mr A might be with Airline Y, and will not instantly forget the terms and conditions of the deals Boeing had done with him while at Airline X.  If someone were to form an opinion that Boeing was cheating on how it activates MFN provisions, rumors would spread and Boeing’s reputation would suffer.

But, although the LOI (letter of intent) for 200 737 MAX planes was the talk of the show, the bottom line for the show tells a different story.  Other than that LOI, no other airline ordered or announced LOIs for any 737s, and in total, Boeing’s firm orders for the show were exactly 0.  It did receive LOIs for 32 other planes as well as the 200 737s, but no firm orders for anything at all.

Airbus had a better show, with orders for 114 planes of all types, and LOIs received for another 241 planes.  But neither company had anything extraordinary to boast about and all in all, it was a muted show.

This Week’s Bad News for Boeing

When will Boeing’s bad news stop?  Even the 200 plane LOI announced at the Paris Air Show was equal parts good and bad news.

In more unambiguously simple bad news which lands fairly in the “don’t know whether to laugh or cry” category, there is an unexpected possible problem with the 737 MAX fix that Boeing is proposing (but still has yet to submit to the FAA for approval).  There are some doubts whether pilots would be strong enough to work the stabilizer trim wheel by themselves without the benefit of power assist.

Of course, everyone is being very careful not to observe that a certain gender that shall be nameless is more likely to have the necessary strength than a certain other gender, and so it is just a generic worry at present that “certain pilots” may not be able to control the plane manually if they need to in an emergency.  Details here.

In more bad news, pilots (of all the many genders that seem to exist these days) continue to worry out loud about not getting enough training in simulators to be able to handle and resolve the situation that caused the two fatal crashes.  There are some things that they probably need to be aware of, even after the changes to the control and operating logic that Boeing is adding which make it less likely the problem would occur.

For sure, no planes are going to return to the air until the pilots agree to fly them, and Boeing is having to walk a fine line between its “there are no new issues or retraining needed when you upgrade from the earlier 737 to the new 737 MAX” which had been one of its key selling points, and admitting to substantial retraining required, which makes it easier for Airbus to get into the equation.

Details here.

Here’s an article with the sort of headline Boeing must hate :  “Why the 737 MAX should never fly again”.

The BBC published an interesting article that opened with Ethiopian Airlines pushing back over suggestions that it was the fault of their pilots that caused their crash.  The really interesting point, to me, though, was a mention in passing that there was a bug in the simulator software that had failed to accurately mimic the conditions in the two fatal crash scenarios, making it even harder for pilots to train and prepare for the previous situation.

That has always been my quiet worry about simulators.  As the old saying goes – GIGO.  Garbage in, garbage out.  Any computer service is only as good as the data and assumptions loaded into it in the first place, and if there are scenarios that the programmers didn’t consider and build in to their modeling, then the simulator may not accurately mimic what would happen in a real plane.

For sure, simulators are stunningly amazing devices, and have revolutionized pilot training, making it much more affordable to give pilots much more training than would ever have been the case if the only type of training was “on the job” training in a real plane.

But it is important to understand that simulators can only simulate what is known.  It is not guaranteed that their algorithms and rules will work when you create a flight situation that is “outside the envelope” – outside the range of normal flight conditions.  Similarly, there might be some unknown additional factor that is not allowed for in the simulation modeling but which occurs in real life in some rare situations.  The only way to be sure about such things is to try them out, for real.

Boeing’s new 777X plane also earned itself some disappointing news this week, with further news about problems in its GE9X engines.  This will cause a several month delay while GE redesigns and tests a fix to the premature wear issue that was uncovered.

So, bad news for the 737 and 777.  What does that leave?  Oh yes, the 787.  All is well with the 787; well, almost all is well.  Just a minor problem with its fire extinguishers – apparently they fail to activate “a small number of times”.

But, hey, what are the chances of a fire on a 787, after all.  Surely nothing to worry about.  Well, actually, the FAA does concede there is a risk to the flying public, but has decided not to ground the fleet.  Again.  Details here.

The Two 777 Mysteries

A new detailed article on the MH370 mysterious disappearance was published this week.  There wasn’t much new information in it, and it seemed to decide that “the pilot did it”, which is sort of a full circle evolution of thinking, because blaming the pilot for enacting an elaborate suicide was one of the very first theories before apparently being debunked.  Now it is back again.

It is probably the most likely explanation, and the easiest to understand, but we’re still open-minded on the topic.

The article is also very critical of the Malaysian authorities, while not developing a complete explanation of why, other than referring to a general mix of incompetence and corruption.  We’d like that angle better researched.  A good read, whatever your views.

Also this week, the semi-mystery of what caused the other mysterious Malaysian 777 crash – MH17 over Ukraine – has taken a further step towards an official explanation, with the announcement that four men have been charged with shooting the plane down.

Actually getting the men arrested, extradited, and to trial is another thing entirely.

A Rose by Any Other Name?

We’ve always sneered at fanciful names for planes like “Dreamliner” and “Spaceship”.  But the 737 MAX range seemed like a moderately sensible name – to us, the term MAX signified that this was the final ultimate expression of the 737 family, to be followed not by another 737 variant but by a totally new plane.  And it was a short three letter designator, similar to the A320 “Neo” designator, and free of the hype in names like Dreamliner.

But Boeing is so worried about the reputational problems the 737 MAX may now be incurring that it has said it is open to the concept of renaming the plane.

But, here’s the thing that Boeing perhaps does not yet fully appreciate.  To the average traveler, it was two “Boeing 737” planes that crashed.  Most people have no idea about the different generations of 737, or the different models within a generation. or what MAX actually means.

Renaming the 737 MAX to the 737 (something else) leaves the two biggest parts of the problem untouched.  The first part is the word “Boeing” and the second part is the number “737”.

So here’s a solution for Boeing to consider.  When Airbus bought out Bombardier’s Cseries planes, it renamed them the Airbus 220 series.  Now that Boeing is buying (or at least, becoming the larger JV partner with) Embraer, maybe Boeing could mimic this and rename the Boeing 737 MAX as the Embraer 123 ABC.  Clearly a totally different plane.

Airbus Announces a Longer Range A321

The long-expected announcement of a new longer range A321XLR came at the Paris Air Show, along with a modest number of orders for the new plane; both new orders and conversions from existing orders to the new longer range model.

This is part of Airbus’ strategy to “bridge the gap” that exists at present that had previously been filled by the discontinued 757.  Airbus hopes that it can make the remaining gap between airplane models and capabilities so small as to become too small to justify Boeing developing an entirely new small wide-body (twin-aisle) plane.

The Boeing plane, widely considered to become the 797, has long been mooted, but Boeing, as it often does, has been endlessly dithering about will it/won’t it proceed, and meantime the gap that exists seems to be better covered by Airbus planes than Boeing planes.  Delays are not working to Boeing’s benefit.

It has been suggested that with corporate focus sharply aligned with resolving its 737 problems and getting the new 777X planes into commercial production, the company has been forced to delay starting any new development program, but we don’t believe that excuse for a minute.

Yes, there is no doubt that the 737 issues have diverted some resource, but Boeing is an enormous company that surely, if it chose to, could handle what still seems like a finite short-term blip (the 737 fixes) and still move forward with a new program at the same time.  And it is a major step to at least firm up some specifications and start taking orders – when you do that, you at least have a response to offer against the Airbus planes.  At present, Boeing is reduced to weakly saying “please wait, trust us, we’ll have something really good, real soon now”.

The problem is that Boeing is not only very large, it has also become institutionally very timid.  No more “betting the company” on visionary programs like the 747 and the twin development of the 757 and 767.

It was this timidity that, in some interpretations, could be said to have created the 737 MAX problem at present.  Boeing was too slow to announce either a 737 replacement or a 737 upgrade.  Airbus beat it to the punch with its “Neo” series of A320 planes, and it was only when American Airlines issued Boeing an ultimatum – either announce a new plane or lose the entirety of a large order that would go instead to Airbus – that Boeing then panicked and rushed a hastily cobbled together 737 MAX into production.

Perhaps if Boeing hadn’t been under such time pressures, after delaying for so long, it might not have suffered the truly-preventable mistakes and omissions that created the 737 MAX vulnerability.

Back to Airbus, however.  Its new A321XLR adds another almost 700 nautical miles of range, and can now be considered for flights of up to 4,700 nm (ie 5400 regular miles).  For me, that means Seattle – London would be possible, and of course, lots of other routes also open up.  These two maps show the range of the earlier A321LR and the new A321XLR on flights from Chicago and Heathrow.

We much prefer twin-aisle planes.  Easier/quicker to board and deplane, and slightly easier access to toilets when you’ve two sets of aisles to try to use to get past trolleys in the aisles and other issues.  And of course, more aisle seats and usually (but not always) fewer middle seats.  So we’re unexcited about the new plane, but if it means more and cheaper flights to more places, it seems like an inevitable step forward.

Excellent Advice :  What You Must Do When Complaining to an Airline

Companies have developed a standard set of responses when their customers complain.  We all know them, because we’ve all experienced them, even if we’ve not categorized them clearly.

There’s the delaying tactic – for example, a problem in your hotel room and the person at reception delays resolving the problem, hoping that they can get through their shift before having to make a difficult decision about what is needed to help you.

There are the promises that are never made good.  There are the deliberate misunderstandings, and there are the refusals to believe your story.  And of course, the “pass the blame” approach where no-one admits to the issue being part of their duties/responsibilities.

One of the other common tactics is for the company to look surprised and say “We’ve never had anyone complain about that before”.  This is supposed to cause us suffer a severe attack of self doubt and to shrivel up in embarrassment, and then apologize for being so unreasonable as to complain that our rental car won’t start, our luggage didn’t arrive, the toilet won’t flush, or whatever the problem is that no-one has ever complained about before.

It isn’t only companies that do this.  Unfortunately, it is also “the airlines’ friend” – the FAA.  In their tortuous attempts to try to credibly believe the fanciful tales the airlines tell them, they have a wonderful affirmative response.  The airlines say that, for example, a $1000 change fee is fair and reasonable.  The DoT says “Well, we’ve only had one or two people ever write to us and complain about that, so obviously most people are happy with this fee and therefore a $1000 change fee is indeed, as the airlines tell us, fair and reasonable”.

So, here’s the thing.  Any time you have a service complaint with an airline, copy the DoT in on your complaint.  They keep a record of all complaints, even if to do with things they can’t directly assist with, and publish monthly reports that include a tabulation of these things – here’s the June one, with complaint data starting on page 43.  In the month reported on, they received 1205 complaints, 60 “opinions” and no compliments.

The most common complaint topics were flight problems (cancellations, delays and misconnections), then refunds, problems with reservations, ticketing and boarding, then baggage, customer service, fares, and so on.  The report makes for interesting reading.

Don’t make it easy for the airlines – and their enabler, the DoT – to claim that the traveling public is 99.999% delighted with everything they do.  Be heard, because your voice might make a difference.  And with email these days, it is easy to copy an email and send it to a second email address.

Here’s an excellent article by the long-time traveler advocate, Ed Perkins, on this topic.

Of Ducks and Roller Coasters and Prisons – aka Cruise Ships

There was a time when the cruise market was growing so rapidly, as people “discovered the joys of cruising” for the first time, and the cruise lines didn’t need to do much more than offer low lead prices and boast about the exciting concept of “no hidden extras on your all-inclusive cruise”.

Well, a lot has happened since then, with low lead prices seldom seen (there was a brief flurry of deals after cruise lines had to cancel their Cuba cruises a couple of weeks ago), and the concept of no hidden extras has now been replaced with something sadly very different.  Even the hallowed concept of all meals free has evolved to “premium dining options” which are becoming more pervasive, more expensive, and less premium.

So the cruise lines are having to resort to increasingly “innovative” concepts to keep bringing people back for more cruises.  Which brings us to the first of these three topics.

A new “craze” on cruise ships, which of course cruise lines are delighted to encourage, seems to be hiding small model ducks on the ship for other people to find.  A compelling reason to go on a cruise, right?  Details here.

We know that as cruise ships get bigger, they can consider, and do consider, more and more amenities and activities.  A new one, which will be featured on the new Carnival Mardi Gras will be a roller coaster that goes around the ship’s funnel and high above its decks, at speeds of up to 40 mph.  What could possibly go wrong with that, one wonders, especially in a high sea.  Details here.

One of the things that cruise lines are best at is obscuring the darker side of cruising.  We don’t hear much at all about the steady disappearances of passengers, rapes and other assaults, and while occasionally a viral outbreak onboard makes the news, few people think about the surprising number of people who die on a cruise through natural causes.

But is it a natural cause to die because the cruise ship refused to allow you to leave the ship and seek more advanced medical care ashore?  Here’s a really strange story of exactly this, when a man had a heart attack on a Carnival ship and was not allowed to leave, but kept as a virtual prisoner on the ship, despite his worsening condition on board.

And Lastly This Week….

We’ve written before about Amazon’s Prime Air operation, and we’re increasingly noticed Amazon branded delivery vans on the streets of Redmond and Seattle too.  While they’re still very small compared to UPS and Fedex, they are growing quickly.

Talking of delivery services, we had a delivery problem with a USPS package.  We called USPS and had to enter our tracking number – that’s a necessary thing, we understand that.  But the tracking number was 30 digits long!!!

We tried to work this out, and got lost in the zeroes, but the Postal Service delivers about 56 billion pieces of first class mail a year.  Most of this is not tracked, but let’s say 25 billion pieces do get tracking numbers.  So a numbering system with 30 digits would be good for 1.6 x 10^20 years.  That’s such a big number that I don’t even know how big it is, but probably longer than the universe is thought to have been in existence.  Nothing like planning for the future, but it is a bit of drag to have to key in a 30 digit number (and then wait 30 – 50 minutes to speak to someone).

Talking about large numbers and complicated sums, the internet has come a long way, and has encouraged a massive evolution in how data is presented.  I love seeing a new form of data presentation such as the population graph in this article – they animate and make the data come alive in a way that static numbers do not and can not.

Here’s an interesting article about “11 strange rules Flight Attendants must follow”.  I guess a few of them are strange and little known.

A typical expression when expressing doubt about something and noting someone else’s gullibility is to talk about their likely interest in buying the Brooklyn Bridge (I’ve never understood why that particular bridge is usually cited).  Well, in case you are tempted to respond positively to offers of bridges for sale – a word of gentle warning.  Be careful.  The bridge might be stolen.

Self-driving cars are welcome in Florida, and Airbus is ready for self-flying planes.  We’re looking forward to both.

Perhaps not as terrifying as snakes on a plane, but here’s a strange story of a United flight that became infested (to some extent) with ants.  Actually, ordinary ants are probably about as benign as one could hope for; and maybe even snakes would be better than bed bugs.

On that ambivalent note of hope, I’ll wish you all the best for summer, now that Thursday saw the summer solstice come and go on what was a rainy and cloudy day in Seattle.

Until next week, please enjoy safe travels

David.