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Friday 13 June, 2008  

Good morning

Today is a 'Black Friday' - the occurrence of the 13th of the month on a Friday - considered by the more superstitious among us as an unlucky day in general, and particularly perhaps for travel.  Let's hope for a good day for us all.

Or perhaps Black Friday came a day early for many of us.  Other airlines are now matching American's $15 fee for checking a first bag (ie UA and US), airlines are tightening up on frequent flier mile benefits (AA is increasing the number of miles needed for some awards and US is discontinuing bonus miles for Preferred members and charging fees for issuing 'free' tickets), and US is even now going to start charging $2 for a formerly free non-alcoholic drink on board most flights.

There are two major items in this week's newsletter, one of which is separately on the website and you can click to, and the other is in a gold border (to make it easier for you to skip if not of interest).  Apologies for what is almost 'too much of a good thing', but expect a 'thin' newsletter next week and then no newsletter the following week (27 June) or the week after (4 July) while I'm traveling with our China group.

Talking about our China tour, which sets off on Tuesday next week, can I point you to this year's Christmas Markets Cruise?  This is the only other Travel Insider tour this year, and is the favorite, both of myself, and of the people who travel with me on this tour.

It provides a wonderful escape from the commercialization, the congestion, and the myriad levels of unpleasantness associated with the 'holiday season' (daren't call it Christmas!) back home, taking you to lovely towns and cities along the Danube in Hungary, Austria, Germany and the Czech Republic.  Good old fashioned Christmas spirit and Christmas cheer is present in abundant measure on the cruise and at our stops along the way, and the local craft markets offer a wide range of usually locally and even hand made goods that give you plenty of gift ideas for everyone on your gift list.

It is nice to see people still enjoying the Christmas season rather than being harried by it, and the cruise is a lovely pre-Christmas treat for all who participate.  Please do consider joining with me and a small group of your fellow readers for this wonderful experience.  Full details here.

I've another multiple themed article this week, in which I review four different accessories for iPods and iPhones.  One of these four accessories is more a joke than a serious suggestion to you, I wonder if you can work out the two things I do like, the one I'm neutral on, and the one which is unlikely to be found in my house.  So :

This Week's Feature Column :  iPod and iPhone Accessories :  Ranging from a better pair of headphones, to music in your toilet, here are reviews on four accessories to consider for your iPod or iPhone.

Dinosaur watching :  I might be watching the dinosaurs, but it is clear that other commentators are not.

I complained last week that the main stream media had largely ignored the big story about how AA had squashed its competitors on the LON-NYC route, preferring instead to trot out homilies about tough times for airlines, fuel prices, etc.

In a particularly disappointing example, a 6 June Wall St Journal article by Scott McCartney, on the topic of (what else) the impact of fuel prices on airlines, mildly makes this comment about AA ending its competition-killing flights now that they have achieved their objective :

So which flights will get cut?  Most of the cutting will come after the busy summer.  Weak international routes are first to go, in general.  The longer the trip the more fuel affects the profitability of the flight.  AMR Corp.'s American Airlines already said it would end its daily service between New York and London's Stansted Airport, for example.  AMR launched that flight in response to start-up business-class carriers using secondary London airports like Standsted [they can't even consistently spell the airport name correctly].  But high fuel costs and limited credit for airlines have already killed the London trans-Atlantic start-ups like Eos and Silverjet.

Apparently, just like the airlines and their press releases, the WSJ and its airlines editor are blaming everything on jet fuel.

Meanwhile, there's an exciting possible postscript to AA's 'bad behavior' in killing off all three independent startup premium cabin competitors on the NYC-LON route.  The most recent of the three casualties, Silverjet, may be returning back to life once more, with a new round of financing apparently almost secured.

Won't it be interesting to see how American responds to a resurrected competitor?  Will it restart its own competing service to try and kill it off again?  Surely this would provide even more evidence of AA's anti-competitive actions that might stir a regulator on one side of the Atlantic or the other into some sort of action at last?  Or perhaps cause a main stream media journalist to rouse themselves from their soporific diet of airline press releases and take notice?  Let's wait and see.

Gordon writes :

I'm with you on AA.  They did the same thing here in Dallas.  Legend Airlines started up an all first class service to (I think) four cities from Love Field.  AA, having a slightly used gate at Love, started flying the same routes, same price within 15 minutes of departure, in an all first class configured MD80.

After Legend ended operations, the flights were gone and the planes reconfigured to the original miserable condition.

At least we got some partial relief from the asinine Wright Amendment.  I use Southwest now for my monthly flights to Jacksonville for reserve duty - they even let me check my bag in for free!

And talking about AA and luggage, reader Linda writes

My daughter, who is a professional photographer based in the UK, recently flew over to the US on AA.  She is a Platinum flyer with them, logging countless miles per year.  She had to take a smaller plane within the US.  On boarding, they would not allow her to carry on her camera gear, but forced her to check it (even though it was within regular size for carry-on).

When she informed them that it would require careful handling, they laughed!  When the plane arrived at the destination, she and her traveling companion watched as the cargo hold was opened and her camera case hurtled to the tarmac.  It was a protective hard case, but the fall from a plane to the ground is a long one.  The case cover was sprung and a very expensive lens was damaged.  By a miracle the camera and an even more expensive lens were OK.  When she went to file a claim at the airport, those in charge of that department also found the incident amusing.

About a week later my daughter received an inane form letter, offering her a piddling number of miles as compensation, and informing her that they could not pay damages, as she should not have checked fragile gear - which, of course, she did not want to do, but was forced to do by AA!

The only good news? They didn't charge her to check it!

After my daughter complained further, she was called by a Mr Steve Lasker from AA who told her that 'professional photographers with work that requires them to travel to outlying areas should find only planes that are large planes; regional planes are unfit for carrying camera cases or any type of electronic equipment.'  He added 'we should NOT (yes you read this right) fly American Airlines, we should try to find an airline that can accommodate our baggage in the overhead, because AA will assume no responsibility for gate checked items or regular checked items.'

When faced with a positive and negative solution to a problem - putting in place a service to allow high value frequent fliers to travel with the tools of their trade as a positive solution, or simply telling them to take their business elsewhere as a negative solution - AA demonstrates an unerring ability to make the wrong choice.

There are two standard 'funnies' that people regularly trot out when discussing just how far the airlines might go in charging extra for things that formerly used to be free.  One is the idea of pay toilets on the planes, and the other is the idea of charging passengers more (or less) for their fare based on their own weight.

The half joking discussion of charging passengers by weight has taken a more serious note recently.  Not only are the airlines examining every possible opportunity to charge for anything and everything, but the progressive tightening of baggage allowances has put the concept of weight based charging into the fore-front of everyone's thinking recently.

So we occasionally see articles in the press that can sometimes be thought of as 'trial balloons' - the airlines encourage the media to run a story and see how the public reacts.  If the reaction is only mildly negative, then they'll feel it safe to proceed with their latest crazy idea, but if the reaction is overwhelmingly negative, they'll then pretend it was never something they were considering.

Last week saw this website appear, ostensibly as a market research exercise by Philadelphia Media Holdings (story here).  Note the way the website combines two issues - carbon emissions and weight based fares - allowing the creators of the site to hide from controversy on either issue if they so choose.

There's also an article here (just one of many that have been appearing in the last few weeks) about the possibility of weight based fares, and it includes several pages of reader responses as well.  From a quick scan, it seems many of the reader objections are ill informed, or could easily be resolved, and operationally, there's little reason why the airlines couldn't quickly institute such a scheme.

What do you think?  Please click on the link below which best records your opinion to send an instant email to me with your answer encoded in the subject line.

Results next week.

I am of less than average weight and strongly oppose the idea of weight based fares I am of average weight and strongly oppose the idea of weight based fares I am of greater than average weight and strongly oppose the idea of weight based fares
I am of less than average weight and mildly oppose the idea of weight based fares I am of average weight and mildly oppose the idea of weight based fares I am of greater than average weight and mildly oppose the idea of weight based fares
I am of less than average weight and have no strong opinion either way I am of average weight and have no strong opinion either way I am of greater than average weight and have no strong opinion either way
I am of less than average weight and mildly support the idea of weight based fares I am of average weight and mildly support the idea of weight based fares I am of greater than average weight and mildly support the idea of weight based fares
I am of less than average weight and strongly support the idea of weight based fares I am of average weight and strongly support the idea of weight based fares I am of greater than average weight and strongly support the idea of weight based fares

Does Emirates enjoy an unfair advantage?  It surprises me that an airline as generally excellent as Emirates has an active coterie of detractors out there; every time I write something positive about the airline, I can be sure to get several hostile emails as a result.  Mind you, it is so rare for me to write something positive about an airline, perhaps if I were to write something positive about any other carrier, that too would attract negative comments.

But the particularly surprising thing about Emirates are the urban legends associated with it - both that, because it is a carrier based in the Middle East, it somehow gets discounts on its jet fuel purchases, and/or because it is owned by the Dubai Government, it has access to unlimited capital and never needs to borrow money and therefore has no interest expense.  Both these two urban legends conclude with the statement 'and that's why they can afford to be so good, and that's why they're so profitable'.

Here's one such example (which is sadly typical), received on Friday from a reader who is best left as anonymous other than to note he describes himself as a retired UA employee (formatting left unchanged) :

to whom it may concern:                     i for
the most part do enjoy your news letter, even the constant rambling & whining can be intertaining.
i do feel that i must point out something that you may have overlooked
though.                     you make mention of united emirates as
being such a great airline, with full amenities, RIGHT! you seem to have overlooked one simple theing though... united emirates is an OIL AIRLINE!!! oil comes from saudi arabia and they pay no more than .42 cents per gallon(most cases) .12 cents per gallon for their fuel...
so, it cost them more to refuel for their return flights, THEY control
and can redilly afford it!!!! so please try and think of that when you
are building up their air line...


I asked the writer (as I do most others) to provide some proof for his allegation.  None is ever forthcoming.  So I went off in search of proof, myself.

Do you want to know what I found?  My research has uncovered a clear answer to both urban legends - to find out what the answers are, click over to the article I've now written, 'Does Emirates Enjoy an Unfair Advantage'.

In a spirit of even-handedness, I'll gingerly pass on praise for another airline that is largely government owned these days (the NZ government had to buy back in to Air NZ in an embarrassing bailout a few years back); reader Jules writes in to say :

Having traveled on British Air long ago and way too many domestic airlines recently, I found your praise for BA, and most especially its food, somewhere between unlikely and requiring a blessed miracle.

But having just flown San Francisco to Auckland on Air New Zealand, I'm now willing to grant the possibility of divine intervention.

The service defined excellence; our flight attendant Neil was hospitable and helpful, interested and interesting. Air New Zealand even provided a ‘concierge,’ advising first-time visitors about the best way to see New Zealand.

But the miracle was the food. In Premium Coach, the food was... premium. Both the New Zealand lamb cutlets and the wood-roasted chicken breast were every bit as good as at top San Francisco restaurants. The dulce de leche chocolate cake was — and how rare is this on an airline — memorably delicious. The New Zealand wines were superb.

Modern miracle? I’ll say amen.

Should I now prepare for a flood of emails criticizing Air NZ?

Thoughts on Fuel Prices

Coming back to the subject of how much airlines pay for their jet fuel, I got an email from reader Susan who asks :

With all of the clout the airlines should have, why is it that they seem to have fallen victim to the energy crisis?  Do you think that they can negotiate for better prices on fuel?  After all, they are big consumers.  Or is it that the oil companies such as Chevron, BP, Shell, etc, has every one by the short hairs?

This sensible question reminded me of some of the appallingly stupid emails that get forwarded ad nauseum by people who should know better - either the emails suggest we all boycott the oil companies on a given day, or that we selectively stop buying gas from one particular oil company; in both cases the rationale being that this will apparently cause the price of gas to drop precipitately.

Would either strategy work?  Let's look at Chevron's 2007 Annual Report and see what it tells us.  Net income for 2007 was 8.7% of gross sales, slightly up on 2006 (when it was 8.3%).  Overall, the industry average is slightly lower (8.3%).

Either number is far from an unrealistically high net income figure (unless you're an airline) - the average for all US manufacturing companies is a comparable 8.9% (excluding autos).  And, as I mentioned in a recent diatribe about Microsoft and its bad software, Microsoft made a net profit of 30.3% last year.  How about that, Mr Obama - if you want to do some political grandstanding about taxing windfall profits, why not pick on Microsoft's 30% net profit, rather than the oil industry's 8.3% profit.

Let's also understand exactly who these impersonal 'big oil' companies are that people and politicians love to criticize.  Oil companies are you and me, and their profits go to you and me.  Oil companies are owned 14.1% by IRA investments, 23.0% by individual investors, 27.0% by pension funds, and 29.5% by mutual funds and other companies.  Only 1.5% of oil companies are owned by corporate insiders and 5% by institutional investors.

Such profits as oil companies make don't disappear.  They go to their shareholders, which in largest part are ordinary people like you and me.  Well, not me, alas, but hopefully you.

And before we even see a penny of profits, there's another 'shareholder' to be paid off, first.  The US government, in the form of taxation.  In 2006, the oil industry paid $90.4 billion dollars in corporate taxes, making it a very good citizen indeed.

Furthermore, Chevron's 8.7% profit does not mean that 8.7% of the cost of a gallon of gas goes to Chevron's bottom line.  Say you're buying a gallon of gas for $4.  About one third of the money you pay goes in taxes and other costs, Chevron probably only sees $2.70.  So the actual profit to Chevron for that gallon of gas is around 24¢.  Even if Chevron was to give you a gallon of gas at their cost, you'd still be paying $3.76.  Although they are easy visible targets, Chevron (and the other oil companies) are not the cause of our expensive gas.  The cause of our expensive gas is the underlying cost of the barrel of crude oil.

The underlying cost of a gallon of gas is actually difficult to establish.  We know that a barrel of crude is currently costing $130 - $140 on the spot market, and we know that a barrel of oil is 42 gallons of liquid crude.  The complicated bit is equating gallons of gasoline with barrels of crude, and in factoring in the other products that are refined from that barrel of crude, and the costs/profits available from these other products too.

On average in the US, refineries are getting about 20.5 gallons of gasoline per barrel of crude.  The rest is not waste, however.  Some of it ends up as plastics, some as tar on the road, some as kerosene, some as diesel, some as jetfuel of course, and some as various other chemicals.

So when you look at it, you can see that the average cost per gallon of raw crude oil ($130-140 divided by 42 gallons = $3.10 - $3.33) is high to start with, and depending on how much the refinery can sell the other by-products depends to a certain extent on the underlying cost per gallon of gasoline from the refinery.  We're very fortunate that there are valuable uses for the rest of the crude, otherwise we'd be looking at a raw cost per gallon of gas of about $6.80, before adding profit, distribution, and taxes.

The purpose of this analysis, such as it is, is to simply explain that the two largest components of the cost of a gallon of gas at the pump is the underlying per barrel cost of crude and the government taxes and fees.  The oil companies can't do anything at all about either the cost of the crude or the taxes and fees added to the pump price of gas.

Some people have proposed that the oil companies should flat out refuse to pay the current high prices to OPEC and the other oil producing nations.  What do you think would happen if they did that (other than you'd not be able to buy gas for your car)?  The people who propose this suggest this would cause OPEC and its prices to collapse, and once the cost dropped down to a more sensible level (whatever that may be considered to be) we could then start buying oil again.

This is a naive view, for two reasons.  Firstly, oil today costs four times a barrel what it did just a very few years ago.  The OPEC nations could happily see their sales volumes halve, or even reduce to a quarter of current levels, and still be making as much money as they were a few years back (at present price levels).  They don't need to discount to encourage demand - the demand is there and much of it is price insensitive.

Perhaps surprisingly, these days the share of oil consumed by the US is much less than it used to be, due to rapid growth of oil consumption in new growing economies such as China and India - the US consumes about 25% of total world energy, and of course, produces 41% of its consumption domestically (and gets another 12% from Canada).  So adding or removing the US share of global oil consumption wouldn't have an extreme impact on the market any which way, even if we were to refuse to buy oil internationally.  Oh - one other thing.  What do you think our own domestic oil producers would do to the price of their oil if suddenly they had to supply all our country's needs, and they had two people fighting over every gallon of gas they could supply?

Secondly, as economists and marketeers know, pricing depends on the supply and demand curve.  Sure, if demand goes down, price can be expected to drop as well, but there is an exception to this - and that is in cartel and monopoly situations - situations such as OPEC and oil production.  The supply/demand curve doesn't work the same way in such cases.  OPEC is somewhat artificially limiting the supply of oil (I say 'somewhat artificially' because some people believe that OPEC, and the world in general, is now producing oil at the maximum rate possible) and with demand outstripping supply, prices are inevitably increasing.  But if demand reduces (ie we refuse to buy any more oil) then OPEC may simply throttle back supply so as to keep an imbalance of supply and demand for the rest of the world.

But even if OPEC left supply at close to the current level, think the plan all the way through.  So we boycott oil; the price drops, and we then triumphantly start buying oil again.  What happens next?  Demand goes back up, and so too does the price again.

In any event, boycotting oil is like bluffing in a game of poker when you've five useless cards and the other players can see your hand.  We can't give up oil.  Oil products are everywhere around us, not just at the pump.  Oil produces the electricity we use - if we lost the share of electricity generated by electricity, we'd have nationwide blackouts and electricity costs would skyrocket.  Oil makes plastics - look around you and imagine your world without plastic.  Oil makes fertilizers and other essential chemicals.  And so on and so on.

So, back to Susan's question.  The airlines do the best job they variously can in negotiating to buy their fuel - as witness Nigel's comment in my article on Emirates and their alleged unfair advantage about saving $242 million in the last year by skillful negotiation and strategic buying.  But there's not a huge difference between the cost of a gallon of jetfuel and its selling price to the airlines to start with, and the airlines too are very limited in how aggressively they can negotiate.  What will they do if they can't get a good price?  Stop flying?  Unlikely.  They know this and their suppliers know this too.

And, on the other side of the transaction, what would the oil companies do?  Simply switch their refining into more diesel (in high demand as shown by the disproportionate increases in diesel prices) and other crude derivatives.  They have choices, and other high-value ways to sell that part of each barrel of oil.

The oil companies, for want of a better phrase, have the airlines over a barrel.

The other part of this issue - the impact of the cost of fuel on the airlines - is what will happen if the airlines do raise their fares sufficiently to cover their increased fuel costs?  To hear the airlines tell the story, they can't do this for fear of facing a massive downturn in passenger numbers (although even as they say it, they are continually adding new fare increases, including another $20 increase this week).

I'm not so sure that the sky is falling.  Will a 30% increase in airfares make flying unaffordable?  That has to be considered in the light of three factors :

(a) The cost of alternate modes of travel - these are also going up by at least the same amount, and often more, so, in relative terms, airfares are still competitive with other modes of transportation.
(b) The total cost of a journey anywhere.  The flight is only a small part of the cost, be it a business trip or vacation.  Add up all the other costs - hotels, rental cars, meals, sightseeing and touring, etc, and the airfare might be a third or a quarter of the total cost.  A 30% increase in the cost of the airfare might add only 10% to the total cost of the journey.
(c)  The historical cost of air fares - in real inflation adjusted terms, air travel costs have been steadily dropping over the last 30 years.  Even a 30% adjustment in air fares now would only serve to recapture some of the previous relative cost of airfares compared to everything else.

Here is a link to a presentation about fuel cost matters, issued by the Air Transport Association - the US airlines lobbying group.  Read through this with a grain of salt - it is naturally an advocacy piece rather than a neutral piece, and as such, some of the information has been chosen to show the airlines in the best possible light, and to maximize the apparent problems they are facing, and so too have the featured quotes and opinions been similarly filtered.

For example, in the charts showing how airfares have risen by substantially less than the cost of inflation, (pages 34 - 36), you'll note that the data series starts in 1978 - the end of regulation, with artificially high fares, and ends in 2007, before the impacts of most of the recent 15 or so airfare increases this year started to occur.  On page 36 in particular, you can see that for the time series between 2000 and 1Q 2008, while it is true that fares have decreased between 2000 and 1Q2008, these are again carefully selected dates.  2000 represented the climax of the previous boom period, and it was the ridiculously high air fares, not 9/11, which brought about the airlines collapse in 2001 and subsequently.  If you were to look at the airfare cost change between any other year and now, you'd see a very different statistic, as is even shown by the data included for 2001, 2002, 2003, 2004, 2005, 2006 and 2007.

Strangely, the ATA is shooting itself in the foot by making airfares today look like incredible bargains.  If this is the truth (and it probably is, although to a lesser degree than the ATA suggests), then what is the problem with airlines simply increasing their airfares now by modest amounts simply to adjust for past inflation rates?  The whole crux of the airlines' alleged problem is 'we need to increase our airfares, but we can't' - how can such a statement be made alongside statistics showing that airfares are lower today than they were 8 years ago, and have increased by less than half the rate of inflation over the past 30 years?

As is often the case, the ATA and its airline members are trying to have their cake and eat it too.

There are some other interesting charts included.  Have a look at page 23.  Almost all energy sources have massively increased in cost this year.  Oil is up about 35%, natural gas is up 67%, and coal is up 36%.  Food prices are up too - corn up 41% and soybeans up 21%.  But there's one clean energy source that has dropped in price 33.3% so far this year.  This vastly under-utilized source of energy sits largely ignored and untouched, but has the promise - and has had this promise for 50+ years - of massively reducing our dependency on oil based energy, and can reduce carbon emissions to almost zero while producing vast amounts of reliable power.

I refer of course to Uranium.  Isn't it about time we start building some more nuclear power plants?

The chart on page 26 is an interesting look at how a 42 gallon barrel of oil ends up being refined into different types of products.  Note that the percentages of product refined can vary depending on how the refining process is 'tuned'.

The most interesting part of the chart on page 34 is not so much the artificially low seeming increase in airfares over the carefully selected time period, but rather the extraordinary growth in college tuition fees and prescription drug charges over the same period (almost three times the rate of inflation - how can this possibly happen?).

Beware of comparisons such as the one shown on page 36. Not only is the time period chosen a very unfair time period, but these two charts incorrectly imply that jet fuel cost changes should be directly matched by airfare cost changes.  That is absolutely not the case - with jetfuel costing anywhere from 15% to 40% of a ticket price, the effect of the jet fuel price changes is massively diluted in terms of expected and required change in air fare prices.  A similar comment applies to page 37.

I have to comment about the chart on page 40, saying the economy could be worse in 2009.  It strikes me as bizarre that people can complain about an economy when both GDP and real disposable income are both projected to rise.  Okay, it might not be rising by much, but any increase is surely better than a decrease?

The chart on page 49 (and the two following pages) is an eye-opener showing enormous gains in airline efficiency in the past 30 years - and these efficiency boosts (plus efficiency boosts in staffing costs) are a large part of the reason why the airlines haven't needed to increase their fares as much as would otherwise seem necessary.  A similar chart on page 55 confirms this - if a plane was fully loaded, it would be providing transportation at a rate of 63 miles per passenger per gallon.  By comparison, if there are two of you in your car, and it is getting 25 miles per gallon, you are getting 50 miles per passenger per gallon - not as efficient.

All the naysayers who deride air transportation as a waste of fuel need to consider this statistic.

Planes continue to get more efficient.  For example, the A330 is about 38% more efficient than the DC-10s they have largely replaced.  And the A319 is about 27% more efficient than the DC-9s they have largely replaced.  These are incredible boosts - imagine buying a new car that is 38% more efficient than your current one.  If you had been getting 25 mpg, you'd now get 35 mpg.  If you had been getting 35 mpg, you'd now get 48 mpg.

In case you wondered at how fuel efficient a typical plane is, here are some figures for average fuel consumption per airborne hour, the plane's typical cruise speed, number of seats, and maximum possible passenger miles per gallon (if all seats were filled).  Note that these are 'best case' figures - there's an extra fuel premium for time wasted on the ground not going anywhere, and for the extra fuel burned in takeoff (that isn't fully compensated for when landing), and of course, planes are seldom full.  But the numbers are interesting, nonetheless.





Pax miles/gal




































Here's an interesting article about the fuel costs to operate a plane, and it ends up sort of where we started in the newsletter this week - with a suggestion that ticket prices and fuel surcharges be based on passenger weight.  Hmmm - yet another source openly discussing this....

In still more weight related news, seven passengers on an AirTran flight from Richmond were denied boarding earlier this week after the airline loaded too much cargo on the flight and the collective weight of the passengers would make the flight overweight.

The passengers were bussed to Newport News and put on another fight to Orlando.  An AirTran official said he had never encountered the cargo-vs-passengers problem before.  AirTran gave each person a free roundtrip ticket to use at a future date.

Cargo is cheaper to transport than passengers with not as many problems, but it is very unusual to hear of cargo being given priority over ticketed passengers.

Here's an interesting thing.  Although most airlines allow you to book flights up to 11 months in advance, Southwest is currently not accepting any reservations beyond 30 October this year.  Many of us are already wanting to book flights for Thanksgiving, Christmas, and other travel needs beyond 31 October, and presumably Southwest is losing out on some of this business by not accepting bookings into November and beyond.

What is up with Southwest?  Why is Southwest not accepting forward bookings more than 4.5 months out?

Some people have speculated that Southwest might be waiting to adjust its schedules based on what happens to other airlines and their schedules, and that is what a Southwest spokesperson indicated when asked about the matter.  This might well be the simple truth, but it rings a bit hollow to me.  You don't freeze your entire reservations system, and refuse future bookings, just because you might be tweaking some of your schedule on and beyond 31 October.  Southwest presumably knows that its 'best' routes will of course continue to operate the same as they always do - shouldn't it at least start accepting bookings for those routes?

Another possible explanation is a massive change either to their fare structure or their route system.  The latter isn't very likely - but what about the former?  I guess we'll have to wait and see.

And if it is just a delay in loading their winter season schedules, someone is being grossly incompetent and costing Southwest a great deal of money by this delay.

Remember all the fuss about Boeing not being awarded the contract for the new Air Force tankers?  In case you wondered what happened about that, we're within a week of finding out.

Here's an interesting article that gently points out some of the hypocrisy in the delicate political game Boeing is now playing - such as seeking special status and extra consideration due to claims of American jobs at risk, while simultaneously arguing against similar special status for other airlines in other countries.

Talking about planes, it is now more than 70 years after the Hindenburg disaster in May 1937 spectacularly (but unfairly) spelled the end for commercial passenger airship services.  This high-visibility accident (with 36 killed) came on the heels of the larger loss of life with the crash of the British R101 in October 1930 (48 killed) and the US Akron crash in April 1933, with 73 killed.

But the mystique and allure of airships remains.  New technologies promise greater safety, and from time to time, companies propose new airship designs.  Interestingly, German airship pioneer Count Ferdinand von Zeppelin left an endowment to fund ongoing airship development, and this funding has resulted in a new German airship, the Zeppelin NT.

This new airship is now undergoing a program of test flights in Germany, and will then travel to London where it will offer joyrides over London for about $300 a flight between 10 July and 21 August.  It then plans to travel across the Atlantic and repeat a similar publicity program in San Francisco.

The airship is not suitable for commercial long distance flight.  It cruises at about 70 mph, and at heights typically between 1000' and 8500', and only carries 12 passengers.

At 70mph, a flight from Los Angeles to New York would take about 36 hours, and a flight from New York to London would take about 50 hours.  Clearly the technology needs to progress an enormous way before airships can compete - a viable airship would need to travel at perhaps three times this speed, and would need a much larger passenger load to be economical.

As an interesting comparison, the Hindenburg traveled at about 80mph and carried 48 passengers.  A ticket from Germany to New Jersey cost about $400 back then, equivalent to about $6000 now.

An airship's 70mph is not a lot faster than average Amtrak speed, but of course is vastly less than high speed rail elsewhere in the world, where 200+ mph speeds are sometimes achieved.  But we continue to hope to see high speed rail in the US, with the latest bit of good news being a release of $45 million in funding towards the creation of a mag-lev train between Los Angeles and Las Vegas.  Traveling at speeds of up to 300 mph, such a train would make the 230 mile journey in well under two hours.

Unfortunately, the $45 million is a mere drop in the bucket - it pays for no more than some environmental studies.  The mag-lev train concept has already been rattling around for almost 20 years - at this rate it will be another 20 years before it gets close to completion.

High speed rail has another supporter.  Bob Crandall, the former hard talking hard dealing CEO of American Airlines spoke to the Wings Club on Tuesday in New York and said he would like to see limited reregulation of the airlines and called for new government policies and investment in infrastructure.

He also blamed the government for a lack of a national transportation plan that he says has led to the decline of not only airlines but railroads and highways and would like to see high speed trains between cities of less than 300 miles.  I'm sure his remaining airline buddies loved to hear that suggestion from him.

Apparently, although he is long out of the CEO spot at AA, he still hasn't forgotten the mantra enthusiastically repeated by all airline CEO's - 'It isn't our fault that we're doing so poorly'.

My favorite river cruise line is renaming itself.  Amadeus Waterways now prefers to be called AMA Waterways.  Yuck.  An ugly name and affected upper case spelling.  Apparently the name Amadeus was too confusing, with too many other companies (and boats!) already using the name Amadeus in some form.

However, ugly new name or not, Ama Waterways remains my clear favorite European river cruise operator, and if you'd like to enjoy a cruise with them, please remember you can get a special 5% Travel Insider discount by booking your cruise through me.

Talking about Europe, France has retained its position as the top tourist destination in the world in 2007, followed by Spain.  Global tourism rose 4% during the year compared with 2006, with American tourists growing disproportionately - 7%.  And, for how long I don't know, but the dollar has recently weakly rallied against the Euro and Pound.  Let's hope that is a long lived trend.

Budget Travel asked its readers to choose the ten top travel innovations of the past ten years.  They narrowed them down to 20 and then asked visitors to its web site to vote for the best 10.

Roller bags was the number one pick, followed by online travel booking, TripAdvisor, Global Internet Access, Cell phones, Worldwide ATM access, GPS navigation, Online flight check-in, Digital photography and online maps.

TripAdvisor at number three?  Hmmm......

For sure, it is important for us Americans to make best use of our vacation time, however.  AIG Travel Guard released the results of a recent survey it commissioned on travel.  The survey indicated Americans had an average 13 vacation days in 2007, whereas our neighbors to the north in Canada had 26, the Brits got 28, and the Italians enjoyed a massive 45.

The rental car upgrade you don't want?  Most of us are delighted to score an upgraded car, but reader Kent writes

My wife went to Boston last week and, as usual, rented the "standard" category car that her employer calls for under its contract with Hertz.  At Pittsburgh, she gets cars such as the Pontiac G6, Chevy HHR, Toyota Prius, Ford Escape, and the like. But at Boston, she was upgraded, as a #1 Club Member, to a Hummer H3!

My wife was sort of ticked, but the office was at the other end of the lot, and she had a meeting that she was leading and needed to be on time. So, she didn't ask for a different car. What irritated her was that sitting next to the H3 was a Saturn VUE, which is on our list of potential replacements for my Olds Intrigue.

Then, there was getting in and out of the darn thing. The first time she got out, she missed the running board with her left foot and almost fell out. The next day, she was wearing a dress and had to lean against the seat, put her feet on the running board, and push herself up to get into the driver's seat.

I can see renting H3s at places such at Jackson Hole, WY, Tucson, AZ, or even Seattle. But Boston, with the narrow winding streets in downtown? On the other hand, she had no trouble merging onto the freeway or through the various construction zones.

We always assumed that an upgrade for her would be a Dodge Charger, a Toyota Avalon, or a Buick Lucerne, and not a Hummer H3. I thought an H3 would be an appropriate upgrade from a Toyota Highlander, a Chevy Equinox, or even a GMC Envoy.

By the way, the H3 was surprisingly easy to drive and far more car-like than the H1, which we've seen at the Chicago Auto Show. The only real problem with driving was looking out the back window. My wife is barely 5' 7", so the spare tire obstructed a lot of the view.

In other Hertz news, they are adjusting their fuel and service charge for renters who don't refill the tank before returning the car.  Effective July 1 Hertz will charge customers based on local fuel prices plus a $6.99 refueling fee.  Renters who choose the fuel option of paying for a fuel tank and returning it empty will be charged at the local rate less .15 cents per gallon as a discount.

Rates are based on geographical averages determined by the OPIl Price Information Service and will be adjusted weekly by local management to reflect local pricing.  Renters can still choose to refill the car themselves and return it with at least as much fuel as was in the vehicle when it left the car lot.

It is almost a year since the release of the much hyped Apple iPhone (reviewed here) and Apple have now released details of the successor model, which will go on sale on 11 July.

The new unit has faster 3G data service capabilities (which means it will download data and web pages 2½ times faster than the current EDGE equipped units), has longer battery life (10 hrs when using EDGE, twice as much as before, and 5 hours on 3G, or 24 hours of audio), built in GPS, updated software (also being released for the original iPhones), and a much lower price point - $199 for an 8GB model (currently $399) and $299 for a new 16GB model, and are very slightly smaller.

Interestingly, these prices are lower than the iPod Touch, which is identical to an iPhone other than for not having a phone built in.  The 8GB iPod Touch currently sells for $299 - who would pay $100 more for a less powerful device, when they can get a new iPhone for $199?  The 16GB iPod Touch currently sells for $399, also $100 more than the comparable/superior new model iPhone.

Can one guess there will soon be price reductions in the iPod Touch units?

On the other hand, it seems the reason for these new low prices is not so much Apple reducing its selling price, but rather its preferred vendor, AT&T, subsidizing the purchase price.  AT&T will simultaneously be increasing some of its fees for using an iPhone on its network, and it seems likely you'll no longer be able to buy a phone at an Apple store without - at the same time - now buying a two year service plan from AT&T.

The new iPhone promises to address some but not all of the limitations of the current iPhone.

And if we're talking of cell phones, time for another edition of Cell Phones are Dangerous for your Health, continued yet again.

This Week's Security Horror Story :  I'd written, a month ago about the bizarre situation where the TSA says it is lawfully able to insist that people show ID when flying, and may refuse to allow passengers to fly if they don't show ID, but, at the same time, the TSA said that, at present, it was not choosing to enforce this requirement, and was allowing people with no ID to fly, simply instead requiring them to go through secondary (more detailed) inspection.

Well, that was then and this is now.  The TSA has now changed its policy.  If you thought the earlier policy was strange, get ready for simply stupid.  The new policy is that if you refuse to show your ID, the TSA will refuse to allow you to fly.  But if you apologetically tell them you lost or forgot your ID, and are polite, they'll let you fly.

Would someone please explain to me how this protects us against terrorism?  How many terrorists will confrontationally refuse to show ID to the TSA at the airport?  Could a terrorist also not pretend to have simply lost/forgotten his ID?

Seems to me this is just the TSA playing bully boy in the playground - 'You've got to be nice to me or else I won't let you fly'.  Details here.

A little discussed truth (ie, all terrorists know this, but few members of the public do) is that the metal detectors we walk through at the airports are useless at detecting many non-metallic threats, ranging from ceramic knives that are every bit as sharp and dangerous as metal ones, to plastic explosives and who knows what else.  Yes, at present, it is difficult to smuggle a gun onto a plane, but wrap a few pounds of plastic explosive around your waist and you can walk through most airport security metal detectors without any fear of being caught.

You mightn't like the idea, but one of the best advances in airport security screening yet is now being rolled out at airports across the US.  Low powered X-ray type scanners are replacing metal detectors - these scanners 'see' through your clothing and show the outline of your body plus also anything else that might be between your body and the outside world, whether such things are metal or not.

The scanners are already up and running in Los Angeles, Baltimore, Denver, Albuquerque, Washington Reagan and JFK. Scanners will be added in Dallas, Detroit, Las Vegas and Miami later this month.

More on expensive drinks, a topic that seems to have struck a chord in the hearts of readers.

James writes :

I stayed at the Berkeley Hotel in London's Hyde Park last year.  One glass of red wine each for two colleagues and me set me back £71 (ie about US$47 per glass).  And that was just for the readily available, by-the-glass house wine.

And Bill recounts a relative bargain compared to the Berkeley :

A glass of very ordinary Chilean wine at the Metropol Hotel in Moscow last week was US$24.  I switched my beverage choice to Russian beer, for the most part.

Lastly this week, is it really true that some people subconsciously gravitate towards jobs that are in some way linked to their name?  Historically, that used to be the case, of course - Mr Baker was the town breadmaker, Mr Cook had a restaurant, etc.  I've sometimes seen modern lists of people with names that are linked to their jobs, and occasionally notice, in news items, people with names that underscore their work activities.

So probably one shouldn't be too surprised at the name of the doctor heading the program mentioned in this article.

Until next week, please enjoy safe travels

David M Rowell aka The Travel Insider

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