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Friday 4 January, 2008  

Good morning

And welcome to 2008.  I hope you had a wonderful 'holiday season' and that you're now armed with steely new resolutions for the year that follows.

As for me, one of my resolutions is to travel more, and so I'm writing to you today from Beijing, having flown here on Northwest on Wednesday.  On-time uneventful flights and a hassle free transition through Beijing Airport (I was in a taxi and leaving the airport within 30 minutes of landing) made for an easy journey, and I'm now peering out through the smog from the 25th floor window of the hotel I'm staying in, wondering exactly what Beijing has to offer.  I expect to find that out in the next few days, and then travel to Shanghai to continue my researches there.

My first meal in Beijing?  A room service meal late last night (most restaurants seem to close early) of spaghetti bolognaise.  I suspect I've not yet plumbed the depths of all that China has to offer on the cuisine front; fortunately a reader in Beijing is taking me to allegedly the finest Peking Duck restaurant for dinner on Friday nights.

Although the hotel is fine - indeed excellent - in many respects, particularly the Customer Service (don't you just love being in a country where labor is cheap and companies are prepared to invest in more staff to provide great service) it is not without its idiosyncracies.  The air conditioning only heats rather than cools, and even though it was below freezing outside last night, the hotel room, which was 77 degrees upon arrival, continued to become toastier and toastier.  Their solution - keep moving me to empty rooms that are cool to start with!  And, alas, the internet is rather catch as catch can.

And in the latest pointer to China's global ascendancy (and soon to be global supremacy) China has switched roles from being a net recipient of international investment to being a net investor itself.  Chinese buyers have spent $29.2 billion acquiring foreign companies so far this year, while investors from the rest of the world have bought $21.5 billion of Chinese companies, according to Thomson Financial as of 20 Dec.  I've said it before, but it is worth repeating - like it or not, the 21st century promises to be China's century.

Anyway, if one of your resolutions, too, is to travel more, please consider coming on one of our Travel Insider tours this year.  We've five lined up for your enjoyment at this time, and this week I'd like to focus on the first two of the five tours.

These two tours are new tours for me.  The first is fairly soon, so hurry and join now.  It is our Amsterdam to Trier (and optionally on to Paris) river cruise, which has two special features to it.  The first is its price - uniquely, when it comes to cruises, there's no single supplement.  None.  So if you're wanting to travel by yourself for a change, there's no cost penalty in choosing to do so.  And, if you are traveling with a companion, we'll give them a 50% discount off their cruise price, so everyone gets to save, whether traveling one by one or two by two.

This special deal is an experiment.  My sense is there are a lot of readers, and/or friends of readers, who would like a chance to travel alone, but who are turned off by the cost penalty and/or the need to share with a stranger, and/or the general reduced pleasure of traveling as a single.  A river cruise creates an instant community of friendly fellow travelers, and this special deal addresses the other concerns.  So let's see what happens with this offer - if it is well received, I have a bargaining lever to use with other travel suppliers, all around the world, to secure similar deals in the future.

The second feature is linked to the first.  The reason for this special deal is in part because, nice guy that I am, I'm giving you most of my commission.  But that means there's no money left on the table for me to come with you, so it is a tour without me (some might suggest that to be another benefit!).  But you don't really need me; the river cruises feature excellent cruise directors who are dedicated to looking after every aspect of your experience all the way through the cruise, and that encourages me to swap the pleasure of my company for instead the pleasure of more money back in your pocket.

So, if you'd like to enjoy this early spring cruise along the Rhine river (you'd depart the US on or before 8 March, and return home on or after 16 March) here is more cruise information, a complete itinerary, and the chance to join the cruise.  And note that United currently has an airfare sale that might lower your cost of travel to join this cruise.

The second tour is in May, and takes us (yes, I'm coming on this one) on a cruise up the Rhône river in the south of France.  Optional pre-cruise touring is offered in either Barcelona or the French Riviera, and at the end of the cruise, there's an extension on to Paris if you should wish it.

This late spring cruise offers beautiful scenery, long days, lots of free French wine, and even a vintage steam train ride.  Come see for yourself the 'new' France now that we have US-loving Nicolas Sarkozy as France's President.  You'd leave the US on or before 9 May, and return home on or after 17 May.  More details here.

I got an interesting email from a reader who doesn't wish his name to be used, telling the story of a problem he'd had with a hotel booking and the eventually positive outcome he secured.  He writes

This summer I emailed the elite Kempinski in St. Petersburg with my standard enquiry: what's your cheapest room rate for the period between mid September and mid October.  The reservations manager replied with something like $300 a night.  I incautiously booked three tickets for the last week of September with Air France and only then attempted to confirm our Kempinski reservation at which point the manager revealed the rate he'd quoted commenced 1 October: for the last week of the summer period we'd have to pay $550 a night or so.

Our son who's spent some time in Russia, explained that the manager, with only business English, replied literally, giving me the cheapest rate within the period, neglecting to add when it started.  Fair enough.  But when I attempted to negotiate a more favorable rate the manager replied in effect, "That's your problem."  A native Russian phoned in our behalf with similar brusque response.  I didn't that acceptable behavior from a premier hotel, even in Russia.

We booked with the Pushka down the street; a nice hotel but not entirely up to European standards.  Not satisfied with our treatment I contacted the Kempinski's management in St. Petersburg, and finally corporate headquarters, in both cases with no response.  And so I entered a caution on TripAdvisor and some months later received an email from a Kempinski manager in St. Petersburg inquiring about the background to my caution.  I sent him copies of my email correspondence.

A month later an email arrived explaining they've had trouble with their email system and offering a three day voucher for two including breakfast, worth over $1,500 in high season.  This was a very generous settlement that greatly exceeded my expectations.

Sometimes, persistence pays off.

This saga - and its very positive ending - reminded me of the need to continue my series on How to Complain, and so, to start 2008 off on a positive note :

This Week's Feature Column :  How to Create and Structure a Winning Complaint :  With customer service standards dropping everywhere, sooner or later you're going to feel the need to complain to someone about something.  In part 2 of a series on how to complain, here are more tips and pointers on how to succeed at getting a fair settlement in such cases.

Dinosaur watching :  Starting Monday, Singapore Airlines is advertising its fares inclusive of all taxes, surcharges and fees.  Their fares will look more expensive than their competitors as it will be the final price so take that into account when comparing their fares against other airlines.

And, if convenient, reward SQ for their honesty and openness by preferentially booking them whenever possible.

Here's an interesting case to watch :  Kate Hanni, founder of the Coalition for an Airline Passengers' Bill of Rights, and Catherine Ray of Fayetteville have filed a lawsuit against American Airlines, saying they deserve compensation for being imprisoned against their will.

The two women were on flights diverted to Austin because of heavy thunderstorms on December 29, 2006.  The complaints allege passengers suffered hunger, thirst, illness, emotional distress and financial losses when American failed to supply the planes with food or water, empty the toilets or let passengers off.  They were on the planes for more than 9 hours.

Some very sensible straight talking from Sir Richard Branson.  His airline, Virgin Atlantic, is locked in a struggle with its cabin crew who are seeking larger pay raises than the airline will agree to, and so they are threatening to strike.  Cabin crew earn less at VS than at BA, and VS has offered an 8.3% increase over two years with a 4.8% increase in the first year.

But, and for one of the very few times ever in the industry, Virgin is refusing to give in and increase their offer, which would allow the spiral of ever increasing costs to grow once more.  Sir Richard wrote an open letter to the cabin crew which is worth quoting in full as an example of good and fair airline management

Dear Colleague,

Although I am no longer overseeing Virgin Atlantic on a day to day basis, as its founder I keep a watchful, and proud, eye over its progress. From one second-hand 747 twenty three years ago, it has turned into an airline that everyone working there can be truly proud of. Everyone who comes into contact with Virgin Atlantic leaves with a smile.

Having set up Virgin Atlantic I know only too well how challenging managing an airline can be. History is littered with carriers that have gone bust - Laker Airways, Dan Air, Air Europe, British Caledonian, and just last week, Maxjet, which had been in business less than 18 months. In our relatively short history, we’ve seen the demise of every airline we competed against back in 1984 (except BA). TWA, Pan Am, People’s Express, Air Florida to name but a few. Even the mighty Continental Airlines, Delta, Northwest and United all went bust only to be bailed out by the US Government with massive loans. One of the principal reasons for these airlines’ demise was internal strife.

Remarkably, Virgin Atlantic has survived against all these giants thanks largely to the attitude and hard work of its staff - by everyone working well together, by ensuring that we are the best airline flying and by having a management team who (by and large) have managed and are managing it well and who are willing to take tough - but necessary - decisions on occasion.

The only other airline to have survived across the Atlantic is British Airways. Unlike Virgin it didn’t grow from one plane with no support. It used to be the national airline and was privatised some 20 years ago with a very large silver spoon in its mouth. It was given the bulk of slots at Heathrow and Gatwick, much of the infrastructure and even Concorde, which had cost the taxpayer hundreds of millions of pounds to build, it was given for one pound.

BA also has the luxury of a short-haul network to feed its long-haul. As a result it has made - and can make - significantly larger profits than us.

Virgin Atlantic has never had any handouts and therefore to survive we have to keep our costs under control.

I’m afraid that those in the union who compare Virgin Atlantic with British Airways are being very unrealistic. It’s like comparing chalk with cheese.

Most people who joined Virgin realised that. They knew that their basic salary was usually not the same as BA’s. But they joined for the benefits that came with working for a smaller, more friendly company. (I know - and I am sure you know - quite a few crew who left Virgin for BA for better pay only to return to Virgin for those other benefits).

I have discussed at length with the senior team whether there is anything more that they can safely do to help and I believe them when they say that the final offer on the table is the best they can or should do in terms of addressing cabin crew salary packages.

There comes a time in any negotiation when a good management team has to draw a line in the sand and I agree with them that time has come. To go further would result in unacceptable risks and would set a dangerous precedent to the company as a whole. It would be irresponsible of our management and they, rightly, are not going to take that risk.

For some of you more pay than Virgin Atlantic can afford may be critical to your lifestyle and if that is the case you should consider working elsewhere. For the vast majority of you, the pay rise you were offered was the best in the industry this year, which is why the union strongly recommended it. I’d urge you not to put at risk our ability to solve this dispute by messing up our customers’ travel plans.

We all want to resolve this situation and give the best pay increase that the business can afford. The best way to achieve this is by keeping all of our planes flying and delivering what we do best - making sure that all of our passengers leave with a smile.

Thankyou and have an excellent New Year.

Richard Branson.

The cabin crew had scheduled two strikes, on 9 & 10 Jan and 16 & 17 Jan, and their union said of Sir Richard's letter that it was insulting, adding: "That sort of language will only harden resolve."  The airline says it expects to operate 90% of its flights during the strike periods.

There was an interesting interview with Southwest's CEO, Gary Kelly, in the Dallas Morning News back on 20 December.

Amongst other comments, he said 'At some point, I think we'll probably acquire somebody' making Southwest a fellow passenger on the bandwagon of airline acquisition supporters.  On the other hand, why should they not support this concept - acquisition is a great way of eliminating competition, which is in large part what Southwest has done twice before - in 1986 when it bought out Muse Air, an airline started by former Southwest CEO Lamar Muse, and in 1993 when it bought out Morris Air, a previous airline operated by Jetblue's David Neeleman.

He had been asked the question 'What do you say to an analyst or hedge fund manager who says, "Gary, why don't you eliminate your closest competitor by acquiring AirTran?".'

His answer notably did not directly address the question asked.  As reported, he replied :

We can't let investors guide the company. That's not to say that investors aren't smart and don't have good ideas, because they do. They just have different motives. We've got to stay true to who we are as a company and build for the long term....

At some point, I think we'll probably acquire somebody. That's just a reflection of my view that the industry is weak and that there'll be players up for sale, probably in a fire-sale mode, and we'll want to at least be thoughtful about that. We'll still have all the considerations - the fleet, the labor contracts, the seniority issues, the cost implications of it, the cultural aspects of trying to bring two work groups together and on and on and on. We would be concerned about that and always have been.

It is interesting to note that Southwest currently has a market capitalization of $9.7 billion.  AirTran is worth $636 million.  So Southwest could buy AirTran just by pulling some change from its petty cash drawer, but integrating AirTran (or most other airlines) would be a challenge - its 717 planes would have to be disposed of, due to Southwest's adherence to a one plane fleet (the 737).

Atlanta has emerged as the busiest airport in the US for the third year in a row, according to preliminary figures released by the FAA.

Atlanta widened its lead over number two airport, O'Hare, with 994,466 flights during 2007, up 1.8% from 2006.  Chicago's O'Hare had 935,000 flights, a 2.4% decrease from the previous year.

Thumbs up to the Euro :  Two more countries - Cyprus and Malta - started using the euro at the stroke of midnight on 1 January.  The Mediterranean islands, both former British colonies, scrapped the Cyprus pound and Maltese lira to bring the number of countries using the shared currency to 15.

Thumbs down to the dollar :  The Indian Tourism minister said today (Friday) that US dollars will no longer be accepted at the country's heritage tourist sites such as the Taj Mahal.  Because of the fall of the dollar against the rupee (down 11% in 2007) the loss was more than the tourism industry could accept.  Now only the rupee will be accepted.

Is the new superliner, Cunard's Queen Victoria, fated to be an unlucky ship?  Some pundits are speculating about that, especially after the ship suffered a minor outbreak of Norovirus a week back.  78 passengers came down with the virus during the ship's second voyage.

The reason for the speculation is a superstition that it is bad luck if the ceremonial bottle of champagne that is smashed over the bow of the ship doesn't break.  In the launch ceremony, Camilla, Duchess of Windsor and wife of Prince Charles, was officiating, and pushed the button that launches the bottle towards the ship's bow.

Nothing happened after several button pushes, and then the bottle finally swung over to the bow, but merely bounced off the steel plating, unbroken.  An unseen functionary on the ship then smashed a backup bottle against the railing.  Ooops.

Luck of a different kind visited thousands of Canadians, in the form of an unexpected winter storm on New Year's Day.  A promotion by itravel2000, a tour company, which took nearly three years to organize, offered vacationers who booked their trip before December 2007 for travel between November 2007 and April of 2008 a chance to get their vacation for free if more than 5 inches of snow accumulated in a major city in their province.

The tour operator negotiated a single weather guarantee insurance policy with Weatherbill, a San Francisco company that guarantees firms' weather-related losses.  A senior Canadian climatologist said prospects for winning the contest were slim as more than 5" of snow fell only once is the past 100 years in Calgary and Halifax, three times in Toronto and four times in Montreal.  But, Montreal had 5.8" of snow so anyone in Quebec who purchased a holiday for travel between the specified times won.

The company said there were thousands of winners and the insurance company will pay out millions of dollars.  The insurance policy covered about $100 million worth of travel.

Battery follow up :  Further to my special email about new regulations for traveling with rechargeable batteries, I received a couple of emails from readers and also have some personal feedback to offer about what it all means.

First, most of the media have misunderstood the situation and are giving you bad advice.  They are saying, incorrectly, that you can only travel with two spare rechargeable batteries - and, to be fair to other media outlets, that is what the original Dept of Transportation press release said.  But the reality is slightly different - you can travel with any number of 'normal capacity' rechargeable batteries, plus up to two 'high capacity' ones.

What makes a battery high capacity?  Don't ask.  The guidelines in the official statement are confusing at best, and hopefully there'll be further clarification soon.

Reader 'C' wrote in to say :

I work for a small airline at [a small airport]; we have heard nothing about this. I printed out the column and will be giving it to my supervisor.

The TSA people, who are ubiquitious here, have said nothing about this to any of us.  This is unbelievable.  What I really think is unprintable.

And reader Jenny writes :

Me again, after talking to TSA people at the Palm Springs airport.  I guess yesterday was really a mess, as the TSA people were totally unclear what batteries were allowed.  Anyway, today at least, the regular kind of lithium camera batteries (AA or AAA) are just fine in carry-ons, and there is no two-battery limit.  I had even brought a pack of them along for the TSA to look at.  The two-battery limit applies to the larger, more serious type of batteries such as those in camcorders, for instance.

I think you will be amused to know that I first approached the Alaska Airlines counter, since the security line was impossibly long, and the AS counter agent didn't know anything about the battery rule at all!  He called over the TSA manager for advice.

Ah, air travel! Isn't it great?!

I flew out of Seatac myself on Wednesday, the second day of the new battery regulations being in force.  There was no mention of anything to do with this at the security checkpoint, and it was 'business as usual' with no new procedures or enforcement at all.

So this is a confusing new regulation and being very confusingly enforced.

Talking about technology, it is dangerous to be too reliant on technology.  Even the most sophisticated of GPS units still need to be used with a measure of common sense.  This story of someone who trusted his GPS more than his common sense is alas far from unique.

Here's a great article on global warming.  Well worth reading, but if you don't have the time, the quick one line summary is that current climate data does not actually show us to be warming up at all.  Read the article and find the reason why global warming might now be receding again.

This Week's Security Horror Story :  A middle class English couple in their 50s were banned for life from an English shopping center as terrorists.

Their crime - they took a picture, in the mall, of their grandchildren.

More details here.

You may have long suspected it, but here now is confirmation that there's one law for the rich and another for the not quite so rich when it comes to airlines selectively enforcing rules and procedures.

Here's an excellent article from pilot and author Patrick Smith on security foolishness.  (His book, Ask the Pilot, is reviewed here.)

And here's a short video from the  Broward County, FL, Sheriff's Office.  This is definitely something that could happen to all of us, and easy to prevent.

Please note that next week's newsletter will either be early or late.  I get back in to Seattle on Friday morning - if time allows, I'll try and send it while transiting through Tokyo, otherwise, it should arrive before midday Friday (Pacific time).

Until then, please enjoy safe travels

              David M Rowell aka The Travel Insider

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