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24 June, 2005 

Good morning

Email issues continue to haunt us.  Last week's newsletter was bounced by AOL for inscrutable reasons known best to themselves - indeed one reader telephoned AOL asking why they'd bounced my newsletter and AOL refused to tell him.

I can understand why a person may choose AOL as a dial up service provider to access the internet, but it is very difficult to see why anyone would also choose AOL as an email service when there are so many other - and better - email services available for free.  Hotmail.com, yahoo.com, and of course, Google's gmail.com all offer completely neutral and completely free email services that work no matter how or where you connect to the internet.

I continue to get - and give away - free Gmail account invitations, although I am a bit perplexed at the people who ask for a Gmail account but then, after having been sent the invitation, never sign up for it!

Anyway, I still have some Gmail invitations, so if you haven't yet asked for one and would like a massive (currently 2.3GB) free and reliable email service, let me know.

Our proposed New Zealand tour received an encouraging amount of interest, and so I'm now proceeding to confirm an itinerary, dates, and price.  Mark your calendar now - to join the tour, you'll need to leave the US on or before Monday 24 October, and the first day you could plan to arrive back home after the tour is Thursday 10 November.

This is going to be a great tour, with highlights including a little known attraction in Rotorua that, to my mind, eclipses the big name sights (the 'Buried Village' with its beautiful bush walk down to a semi-subterranean waterfall), and two full days in Queenstown where you're free to see and do whatever you like.

There's a massive range of activities and modes of travel during the two Queenstown days, ranging from riding an old steam train to a modern helicopter, from a vintage steamer across the lake to jetboating at high speed through a rocky river gorge nearby.  Sedately traveling up the mountain by gondola, and zooming down on a luge ride.  And a trip to Milford Sound, perhaps by coach one way and light plane the other, including a cruise out to the ocean and a visit to the underwater observatory.  Plus, if time remains available, there's river rafting and bungee jumping, too!

We go places most other tours don't (such as through the Wairarapa) and our time in Hawkes Bay will provide a wonderful climax to our NZ experience.

I hope to be able to quote a firm price and start accepting reservations next week.  Probably about US$2500 (per person share twin) for the ground portion plus air travel any way you wish (from your home to Auckland, Rotorua to Queenstown, then Auckland back home again).

New Zealand's main newspaper, the NZ Herald, reports today that property prices in Hawkes Bay increased from an average NZ$230,000 selling price to an average NZ$249,500 selling price - in just a single month (April 05 to May 05)!  While I continue to maintain that property is not a reliable low risk short term investment (and a single month shift in pricing is far from a long term trend), it wouldn't take too many months of appreciation like this to make a NZ winter home a very interesting proposition, both from a life-style and an economic perspective.

Let me know if you're not yet on my NZ Winter Home email list and would like to be added.

My feature column this week appeared at the very last minute.  It was to be another item in the newsletter, but it took on a life of itself, and became (I felt) too important to leave in the newsletter with everything else.  So :

This Week's Feature Column :  United's Undisclosed $15 Billion Asset :  United has been bankrupt since December 2002.  It has used this status as an excuse to renege on deals left right and center with suppliers, present employees and retirees.  Most recently, its pathetic financial whimpering has elicited a massive $6.6 billion pension bailout by taxpayers.  So imagine my surprise at uncovering an asset UA is quietly sitting on that may be worth $15 billion.

Dinosaur watching :  Last week's instant survey asked what you considered to be the most valuable part of flying first class.  You could choose the extra leg room, the extra seat width, or the extra service and amenities.

Half the responses said all three things were equally important.  Of the people who could prioritize which feature was most important, half chose leg room, just over a quarter chose seat width, and under one quarter chose amenities.

These results were pretty much as expected.  The most valued part of the first class experience is the extra legroom.

So what are the airlines doing to their domestic first class?  Reducing leg room!  The most obvious example, according to Joe Brancatelli, is Northwest.  Joe points out the pitch in first class on NW's DC9/MD80 planes is 34" - the same as JetBlue offers in most of its [lovely leather] coach class seats.  Who'd pay extra for NW's old first class seat when there's a very comfortable JetBlue seat available for much less?

Sometimes it seems the major carriers have a death-wish.

I'd written last week about the rumors of other potential groups wanting to file reorganization plans for United Airlines.  So what does United ask for - and, alas, receive - from their bankruptcy judge?  Yet another extension of their exclusivity period.  It had been due to expire on 1 July, and they've now been given another two months, through 1 September, to delay do their own thing free of the threat of real world proposals from other sources.

The Bureau of Transportation Statistics reports that airlines employed a total of 451,915 workers in April, down 2.8% from April 2004. The seven major carriers (AA UA DL NW CO US and AS) had a drop of 6.1% (305,000 full and part time employees) while low fare carriers had a minor 0.5% drop and regional carriers actually increased their hiring by 12.1%.

Equating two part time employees as one full time equivalent, numbers at the legacy carriers have dropped 34% in the last four years.  Winner of the vanishing employee award is US Airways, with a 49.6% drop in staff.  Runner up is United, with a 42.4% drop.

Talking about drops in staffing levels, there is still some ambiguity about the effect on staff numbers of the merger between US Airways and America West.  This ambiguity may soon be resolved, because on Thursday the Justice Department gave its approval of the merger, saying there were no anti-trust concerns; indeed they were quite positive, saying in a statement

The consolidation of America West and US Airways, which will create the fifth-largest domestic carrier, will enable the merged airline to offer U.S. consumers more and better service to more destinations throughout the country

No details of exactly how we will enjoy 'more and better service' were given.

Meanwhile, the potential labor problems of a merged airline continue to simmer barely beneath the surface.  The America West pilots issued a statement this week expressing 'deep concern' about the way the integration process will be handled.  Translation :  They're worried the US Airways pilots will get all the more senior (better paying, and with more perks) jobs.

I wrote last week about Northwest chairman Gary Wilson selling down his holdings in his airline.  He has since sold an additional 61,750 shares of his stock.

Maybe he is worried about the growing confrontation between Northwest and its employees.  Northwest managers are being trained to serve as flight attendants should the attendants decide to strike the airline.  Northwest is currently in mediated talks with the attendants, mechanics, and ground workers, and is seeking $1.1 billion in concessions from them.

I wonder if the managers will act the same way as present attendants.  Reader Rich passes this on :

I flew Northwurst the other day DTW/ORD and the flight attendant was trying to sell the awful trail mix for $1 that had two weeks ago been part of the free amenities.

Her comment:  "No takers?  Can't blame you."

First laughter I've heard on NW ever I think.

Continuing its anti-strike preparations, on Monday Northwest held an open house in Detroit for flight attendants.   And in Tucson, the American Institute of Aeronautics & Astronautics is suing the Radisson Hotel City Center because they had contracted with the hotel for a July conference and were dumped when Northwest booked the 307 room hotel for the purpose of training newly hired aviation mechanics.

NW is certainly preparing for the worst, and some have speculated that NW management plans to goad their employees into striking.  The mechanics union said they discovered the replacement mechanics are being given a $2,000 signing bonus, free hotel rooms and a $32 an hour wage. The union plans to file a lawsuit against the airline, charging them with not negotiating in good faith.

Good news for Delta.  The Georgia Supreme Court threw out a suit filed against Delta regarding responsibility for a passenger who got drunk on a flight from Milwaukee to Atlanta and was involved in a traffic accident on the way home from the airport.

The driver of the car he hit was seriously injured and so both drivers sued Delta.  The court said 'while an airline knows or should know that an intoxicated passengers will shortly be leaving the plane and where the alcohol was served, it has no way of knowing whether any of its passengers will "soon" be operating a vehicle as opposed to remaining at the airport or departing by some other means of transportation.'

If you can't beat them, join them?  After Singapore Airlines were rebuffed, yet again, by the Australian government (the government decided to delay any decision on allowing SQ or anyone else to start flying between Sydney and Los Angeles), Australia's Trade Minister volunteered an apparently unsolicited comment that he'd support a proposal for SQ and Qantas to merge.

The minister said a merger would ensure that Qantas would remain viable in the global aviation market.  Being as how Qantas is currently the world's most profitable airline, this doesn't seem to presently be a pressing challenge.

And being as how a merged SQ/QF would be very much less Australian an experience (as well as much less Singaporean an experience too - imagine a brawny Aussie cabin attendant on an SQ flight, or a delicate SQ attendant on a QF flight), merging Qantas with SQ would seem to imperil rather than ensure QF's future existence.

Singapore Airlines - long believed to want to buy into QF - quickly said it has no plans to merge with Qantas.  Which, of course, is not quite the same as saying it does not want to do this.

Here's an interesting proof that travelers are smarter than some businesses give them credit for.  A Nielsen Net Ratings report on travel websites shows that airline websites are more successful in converting visitors to buyers than are generic travel sites.

Southwest is the most successful airline with a conversion rate of 14%, followed by American with 9% and Delta in third place at 10%.  Nielsen says that nearly 50% of all airline ticket sales and reservations were conducted online during the last six months.

More than half of online travel shoppers begin with a visit to a generic travel agency site (such as, eg, Expedia or Orbitz or Travelocity) but half of these people move on to an airline site to actually book their flights.

This is sensible because although the generic travel sites give you the best access to information about most airlines, their schedules and fares, if you want to then book on the generic site, you'll almost certainly be up for a per ticket fee over and above the airfare.  As guest writer Bob Cowen advocates in this article he contributed to The Travel Insider site, your best strategy is to use a generic site to find the flights and fares you want, and then go to the specific airline site to book and pay for the flights.

I wrote last week about Airbus' tremendous success at the Paris Air Show.  Several readers wanted to point out that many of the Airbus orders announced were a long way away from being considered a 'sure thing'.  That is a very fair comment, and I've always tried to avoid analyzing the relative performance of Airbus and Boeing by annual order counts, due to so many orders 'evolving' and changing between their first announcement and final plane delivery and payment.

However, I don't fully agree with the readers who said the reason Boeing's order count is now lower than Airbus for the year is due to Boeing being more conservative in how it books its orders.  On Monday Boeing had to reverse out its flagship order of the year; the order which was being touted as the clearest proof that Boeing had beaten Airbus into a pulp and was now the big boy on the block (due to Air Canada having previously been a very loyal Airbus supporter).  This was a $6 billion order, and also the second largest Boeing has received for the new 787, from Air Canada.  Reversing this major coup order means not only has Boeing's fleeting claim to market leadership been further discarded, but the success of the 787 is no longer as massive as earlier imagined.

This Air Canada order was always encumbered by a massive 'subject to' restriction and should never have been considered to be as 'real' as it was.

One of my complaints about Boeing has been its lack of innovation in recent years.  Here's an example of a very innovative new 'plane' that could be in production as early as 2010.  While this article is almost certainly way too unrealistically positive about the plane, could I point out who is developing and building this plane.  Not Boeing.  Not even Airbus.  Instead, it is a project being funded in South Korea.

A new FAA requirement sets a new low standard for totally stupid and meaningless over-regulation.  Airlines are now required to provide information on where their planes were finally assembled.  This information has to be printed on the seatback cards that provide emergency exit information.

The FAA estimated it would cost $522,000 to print stickers and place them on all the cards in the 6,559 planes affected.

Plus, note carefully the wording of the requirement.  The disclosure need only state where the plane was finally assembled.  It doesn't need to reveal what percentage content of the plane was sourced from which countries.  Which means the new Boeing 787, consisting largely of sub-assemblies made all around the world, but finally assembled by a skeleton crew in Everett, WA, will be labeled as 'Assembled in the US', whereas the Airbus planes, many times with comparable amounts of US value in them as the Boeing planes, will be labeled as 'Assembled in France'.

As if anyone cares.  Has our knowledge of the foreign origin of Japanese cars stopped us buying them?  Or of just about any/all electronic goods?  Or clothing?  'Buy American' is a great phrase, but who really lets that concept rule their personal life?  Based on our growing trade imbalance, clearly no-one.

It hasn't been a good week for trains.  The usually super-efficient Swiss suffered a major embarrassment when their total rail network ground to a halt on Wednesday during their busy afternoon rush hour.  A power failure at a central location killed the entire electrically powered rail system for nearly four hours and stranded tens of thousands of passengers during a heat wave.

Talking about heat waves, it is time for the annual story about the impossible summer conditions on London's Underground.  The oldest underground system in the world, it has no cooling, and with the passing of time, and growing numbers of trains and people, the tunnels are heating up and each year temperatures get higher than the previous year.

This year - and we're only in June, with several months of increasing temperatures still to come - temperatures have already been exceeding 104F (40C) and due to the high humidity, perceived temperatures are passing through the 115F mark.  Tthat sure isn't my idea of a fun way to spend a London vacation.

Expect these temperatures to rise still further over the next few months.  More details here.

And in the US, another unkindness is dealt to Amtrak, with the House Appropriations Committee voting to provide Amtrak a mere $550 million for the coming fiscal year.  Amtrak says it needs $1.2 billion merely to maintain its network.  $550 million will make Amtrak get worse, not better.

What says our not-very-respected Secretary of Transport, Norman Mineta?  He says :

The movement toward successful reform of Amtrak is growing stronger every day, thanks in large part to the work of the House Appropriations Committee. With its help, I am confident that we will finally make progress this year toward a more viable and fiscally responsible intercity passenger rail system.

So starving a business of the cash it desperately needs, and increasing its indebtedness, is progress towards making it viable?  Not on this planet.

Perhaps instead of having an airport named after him (San Jose - see last week's comment), Mr Mineta should have a derelict train station named in his honor.  It might be more appropriate.

For balance, some good rail news.  With the opening of three new railway stations in London in 2007, journey times from London to Paris will drop to under two hours, and from London to Brussels to a mere 95 minutes.  These times are 40 minutes faster than at present.  Details here.

One of my pet hates :  Hotels (usually up market and very expensive) that plaster their bathrooms with signs professing a care for the environment, which translates to 'we're going to save money by not laundering your towels as often as we used to'.  The hotel tries to embarrass its guests into accepting a reduced level of service by hiding behind the excuse of being environmentally concerned.

This is being taken a step further by thirteen hotels who are in the state-run Beijing Tourism Group.  They have decided to phase out supplying all toiletries to guests. This means no tooth-paste, toothbrushes, slippers, soap, shampoo and combs in hotel rooms. The hotels say they are doing this to protect the environment.  Uh huh.

Talking about hotels, Utell hotels have cut their rates for July and August by almost 50%. The discounts apply to more than 2,200 properties, including 1,500 in Europe, 200 in Asia and almost 500 in the US. A minimum booking of two nights is required.

Most expensive city to visit?  Tokyo scores highest, followed by Osaka then London, according to the annual report by Mercer Human Resources Consulting.  The most expensive US city was New York, ranked at number 13 worldwide (out of a total of 144 cities surveyed).

If you're traveling on a budget, perhaps you should consider Asuncion, Paraguay, which came in as the cheapest city.

Following on from my comments about oil prices last week, rates have continued to rise this week, breaking through $60, first for December deliveries on Monday and Tuesday, then for August deliveries on Thursday.

But, don't worry.  Our elected representatives are right on top of the problem.  As this article explains, the Senate voted on Tuesday to allow the government to sue Opec.  That should solve the world oil crisis, for sure.

Counter-currents :  Mauritius has proudly announced plans for nationwide Wi-Fi coverage.  But Orlando is discontinuing its free downtown Wi-Fi service, due to lack of use.

This Week's Security Horror Story :  A 31 year old Minneapolis attorney had his car key confiscated when trying to take it through airport security.  If he hadn't have secreted another key underneath his car, he'd have been unable to drive his car home from the airport.

Although car keys are not forbidden items, because TSA screeners have individual discretion (but alas, apparently no commonsense) there's no way of knowing what otherwise harmless objects might not upset them.  More details here.

I wrote about the lady trying to smuggle fish into Australia a couple of weeks ago, and now have found a picture of her fish-smuggling outfit.  Amazing.  What is most amazing is that she sat with all the fish around her for hours on her flight to Australia.

It is becoming so common that it no longer rates as the horror story of the week, but if you're still able to be shocked by such things, here's yet another story about the TSA lying to everyone about what it is doing, and doing things it has been instructed by Congress not to do.

Lastly this week, here's another mobile phone 'innovation' (subsequent to last week's innovation).

Until next week, please enjoy safe travels

              David M Rowell aka The Travel Insider

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