nkralev on August 12th, 2010

My name was involved in a curious intrigue this week. One of Secretary of State Hillary Clinton’s aides, in an attempt to get back at the Washington Times for a recent series of critical stories about Clinton’s deputy Jacob Lew, leaked to a reporter unpaid bills for trips I took with the secretary last year.

I understand the bills are now being settled, following yesterday’s story on the Foreign Policy magazine’s website. I was the Times’ diplomatic correspondent for nine years, until June.

When reporters travel with the secretary, the State Department charges their respective media for the plane ride and any costs incurred on the ground, such as motorcade vehicles and filing centers. Sometimes, those bills are sent out months after a trip, but every time I received one, I gave it to the appropriate person at the Times, along with the original trip authorization from senior management.

I’m told that four unpaid bills have been sitting in a folder in the accounting office for months. Shortly before I left the paper, I was asked how important it is to pay them quickly, given the Times’ tight finances. I pointed out that the bills are overdue, but that was the last time the subject came up.

The Times has had a new editor since January, and it’s possible the issue was never raised with him. It appears he has now made sure the matter is resolved.

This was certainly a very creative way for the State Department to get its money back. Isn’t the Washington game just precious? The stories the Times has been running about Lew have to do with his financial disclosures from his time at Citigroup, before joining the Obama administration. Since I haven’t worked at the paper for two months, I obviously had nothing to do with those stories — nor did I have a hand in any articles about Lew that may have been written before my departure.

Lew has been deputy secretary of state for management since January 2009, and earlier this summer, President Obama chose him as the next director of the White House Office of Management and Budget — a post he held at the end of the Clinton administration.

Continue reading about My trips with Clinton back in the news

nkralev on August 10th, 2010

Air travel is one of those topics that no radio or TV show can go wrong with — it’s certain to touch a nerve with many people and provoke numerous comments and questions. That’s what happened yesterday on NPR’s Diane Rehm Show, which I was on for the first time.

I always thought the reason to be invited would be to talk about foreign policy on the Friday news roundup, where Diane has three Washington journalists discussing issues from the passing week. That never happened, but a couple of weeks ago I suggested to one of the show’s producers that the summer is a good time for a program on travel.

The Diane Rehm Show is widely considered the best talk show on NPR, with more than 2 million listeners a week. It’s produced by WAMU, the NPR station in DC, and airs in dozens of markets across the U.S. Diane is on vacation this week, so the guest-host was Frank Sesno, a former CNN bureau chief in DC who now heads the George Washington University’s School of Media and Public Affairs.

There were two other guests except me: from Dallas, Scott McCartney, who writes “The Middle Seat” column for The Wall Street Journal, and from New York, Susan Stellin, a New York Times contributor.

You can listen to the show and read some of the comments left by listeners on its website. We actually got hundreds of comments and questions by phone, e-mail and on Facebook and Twitter.

We talked about various familiar topics, such as airline fees, seats, delays, the proposed Passengers’ Bill of Rights, re-regulation prospects and others.

Since the show’s topic was “Navigating the not-so-friendly skies,” I wanted to offer some advice on how to do that. The main point I tried to make was about the need for travel education, realizing that most people don’t see such a need because they think they know how to travel. But if that were true, we’d be hearing many fewer complaints and horror stories about air travel.

It’s convenient and popular to blame the airlines all the time — and they often deserve much of that blame — but there is a lot travelers can do to make their own experience less stressful and more seamless.

The airlines have made the system very complex, confusing and frustrating. It is what it is, and we can’t changed it that much. However, we can find ways to make the system work for us — and to do that, we need to know it really well. That’s why I believe every traveler can use a bit of education.

My other main point was about the importance of elite airline status, which is the only decent way to travel today. The reality is that airlines don’t even pretend to try taking care of you if something goes wrong unless you are a loyal customer. More practically, elite passengers are exempt from luggage and other fees.

Unfortunately, most people don’t even try to achieve elite status, because they only travel a couple of times a year. As I wrote last month, you only need 4,000 miles on Greece’s Aegean Airlines to get silver status on the Star Alliance, and Aegean gives you 1,000 miles just for signing up. You don’t have to fly on Aegean — just to credit your miles from flights on any of the 28 Star carriers to that program. Silver status waives baggage fees on United Airlines, US Airways and Continental Airlines.

I was amused to read in the comments on the Diane Rehm Show’s website that a listener accused me of being unpatriotic for recommending membership in a foreign airline’s frequent-flier program.

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nkralev on August 6th, 2010

Global airline alliances are a relatively new concept, and the three existing ones have naturally had to create their own rules. This week’s Mexicana Airlines decision to suspend ticket sales raised serious questions about Oneworld rules and requirements.

Why did the alliance insist publicly that all was fine at Mexicana just a day before the announcement? Did the carrier fail to give Oneworld a proper warning?

On Tuesday, Mexicana filed for insolvency proceedings in Mexico and bankruptcy protection in the United States. That same day, Oneworld spokesman Michael Blunt issued a press release, assuring travelers that the Mexicana’s position in the alliance was “unaffected” by the developments.

“Mexicana has stressed that it will continue to operate normally, in line with Mexican legislation covering such restructurings. Its schedule is being maintained — though with some network and frequency changes — and it continues to take bookings and offer its full range of services. So the airline continues to offer full Oneworld services and benefits, and tickets for flights on Mexicana and its frequent-flier arrangements are unaffected,” Blunt said.

That statement reminded me of the Star Alliance’s expression of support for United Airlines when it filed for Chapter 11 bankruptcy protection in 2002. But as it turned out, things with Mexicana were very different.

Late Wednesday, Mexicana stopped selling tickets. In a new press release, Oneworld called it a “temporary suspension,” adding that, “during this time, Mexicana will continue to operate most of its previously scheduled international flights as normal, but further bookings will not be accepted.”

The logical question is, How long can the airline continue to operate flights for which it accepts no bookings? More importantly, was Oneworld blindsided by the sales suspension or did it mislead customers in its first statement? Did Mexicana bother to tell the alliance what was coming up? Was it even required to do so by Oneworld rules?

Blunt didn’t respond to an e-mail I sent him yesterday with those questions.

Mexicana is Oneworld’s 11th and newest member, having joined in November 2009. Among the alliance’s other members are American Airlines, British Airways, Cathay Pacific and Qantas Airways. Mexicana was part of the Star Alliance from 2000 until 2004. Interestingly, Star’s CEO, Jaan Albrecht, is a former Mexicana pilot.

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Continue reading about Mexicana embarrasses Oneworld alliance

nkralev on August 2nd, 2010

The management teams of United Airlines and Continental Airlines have never seen eye to eye when it comes to customer loyalty, and that seems to be causing trouble during their merger preparations. My inside sources tell me that Continental executives don’t quite understand United’s big emphasis on loyalty in recent years.

It also appears that Jeff Foland, who last week was named head of the combined carrier’s frequent-flier program, Mileage Plus, will have a tough job selling United’s current philosophy to his new bosses in the Continental team, which will run the company once the merger is completed, most likely around year’s end.

Even though Foland, who has been United’s senior vice president for worldwide sales and marketing since 2006, didn’t have a direct formal role in Mileage Plus’ decision-making, he is said to be greatly influenced by the way his current superiors and colleagues do business. After all, his entire short career in the airline industry has been spent at United.

In addition, all United call centers, including the only remaining Mileage Plus center in Rapid City, SD, reported to Foland, so he is no stranger to the recent drive to turn the program into a profitable business.

Foland will succeed Graham Atkinson, the current Mileage Plus president, who used to have Foland’s present job. As I wrote in February, Atkinson is responsible for changing United’s overall approach to loyalty by proving that what’s good for customers doesn’t necessarily have to be bad for the company.

Most of the changes he made in less than two years on the job have been welcomed as major improvements by Mileage Plus members, including the introduction of one-way awards and eliminating so-called close-in fees, charged when an award ticket is issued less than three weeks before a trip. The attention Atkinson has paid to customer feedback and the degree to which he has acted on that feedback are extremely rare, if not unprecedented, in any customer-service-driven industry.

The bottom line for the company is that, by making and keeping its most loyal customers happy, Atkinson turned Mileage Plus into a money-making business. The bottom line for customers is that Mileage Plus today is probably the best program in the industry, with the notable exception of StarNet blocking. Hopefully, the practice of massively blocking award seats otherwise made available for mileage redemption by United’s partners in the global Star Alliance will soon be on its way out.

It’s no secret that Continental’s priorities have lied elsewhere under Jeff Smisek, its chairman, president and CEO, who will be CEO of the combined airline. Smisek has won much praise for his management style, which has helped the company’s finances during a tough period and significantly improved both its hard and soft products. Continental has chosen to lure passengers in its premium cabins by lowering business-class fares, while United has kept those fares high, resulting in more upgrades for elite customers.

Although that choice has its merits, Continental’s OnePass is hardly a leading loyalty program. There is nothing wrong with trying to attract more paying business-class passengers, but in the current environment, a strong upgrade product would go a long way to securing long-term customers.

United has that product, and so does American Airlines, United’s main competitor. Even though Mileage Plus and OnePass have aligned some of their features, they remain apart in many respects — and most importantly, in their business philosophies. Hopefully, the unpleasant prospect of losing customers to American will prevent the merged carrier’s management from curtailing the more significant benefits in Mileage Plus compared to OnePass.

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