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The Star Alliance’s 15th birthday this month reminds me that a global airline alliance is one of the most fascinating concepts in the history of commercial aviation. It’s also an example of the airline industry’s creative thinking aimed at increasing revenues. However, unlike some of the questionable practices I described in “Decoding Air Travel,” this one has dramatically improved the customer experience.
It’s fascinating for me personally, because it combines my two passions and areas of expertise, international affairs and air travel. In fact, what alliance executive teams do every day is nothing short of diplomacy. International negotiations and dispute resolution are two of their specialties, and a big part of their duties is selecting new members, not unlike NATO and the European Union.
When Star was formed in 1997, the idea was not only to represent its members’ best interests — that’s primarily the job of trade associations — but to boost business by feeding passengers from one carrier to another in the smoothest possible way. Soon, airline diplomacy began in earnest — first among alliance members, which after all are rivals in a fiercely competitive industry, and then with airports, transportation authorities and governments around the world. The other two global alliances are Oneworld and SkyTeam.
“Much of what we do is diplomacy,” Jaan Albrecht, Star’s former CEO, told me when I first met him in the alliance’s Frankfurt office in 2008. “We try to educate airports, publics and governments about the benefits that come from a network like ours.” Albrecht is now CEO of Austrian Airlines, a Star member.
The benefits for customers that come with an alliance membership are both tangible and intangible. The first category includes interline ticketing and check-in, harmonized schedules to provide seamless connections, worldwide lounge access, mileage-earning and redemption opportunities, as well as elite-status recognition across the alliance, and round-the-world and other special-fare products.
It’s also important to appreciate the intangible benefits. The most important to me is that the experience on an alliance’s various carriers is so similar and yet so different. I like the predictability created by consistent and aligned policies — knowing how things work and what to expect gives me comfort at the airport and in the air. At the same time, I love the individual touches that each airline adds to the travel experience, based on its national, cultural and even corporate uniqueness.
For example, Scandinavian Airlines and Thai Airways are both Star members, and technically there is no difference which one you are booked on — you will earn miles, check-in all the way through to your final destination and access their lounges anywhere in the world. But when you enter a lounge or board a plane, you will never confuse Scandinavian with Thai.
Critics of the alliance concept usually argue that consumers suffer, because closer cooperation among airlines leads to higher fares. They refer to special arrangements, known as anti-trust immunity exceptions, which are granted to some carriers so they can coordinate fares, schedules and inventory on certain routes. The largest members of the three alliances have received such waivers on intercontinental routes. Some have gone a step further, securing approval to operate certain routes as a joint venture. Price-fixing is illegal, so these carriers needed the exceptions to publish identical fares — and if you compare their tariffs, you will see they are indeed identical.
When granting the immunity, the Department of Transportation is careful to exclude routes on which the only existing service is provided by the carriers seeking the waiver — those exclusions are known as “carve-outs.” So the government is supposed to protect consumers, and it seems it’s doing its job. Overall, there is no question in my mind that airline alliances have had a positive impact on customers.
All three alliances have had troubles lately, as member-carriers have experienced hard times, filed for bankruptcy or disappeared all together. But that’s the nature of the airline business. My only criticism is that none of the groups has done a good job at reaching out to a broad audience to explain and promote the benefits I described above.
Here is the current membership of each alliance:
Star Alliance
Adria, Aegean, Air Canada, Air China, Air New Zealand, All Nippon, Asiana, Austrian, Blue1, Brussels, Croatia, EgyptAir, Ethiopian, LOT Polish, Lufthansa, SAS, Singapore, South African, Swiss, TAM, TAP Portugal, Thai, Turkish, United, US Airways.
Accepted future members: Copa, Eva, Shenzhen, TACA.
Oneworld
AirBerlin, American, British, Cathay Pacific, Finnair, Iberia, Japan, LAN, Qantas, Royal Jordanian, S7.
Accepted future members: Kingfisher, Malaysia.
SkyTeam
Aeroflot, AeroMexico, AirEuropa, Air France, Alitalia, China Airlines, China Eastern, China Southern, Czech, Delta, Kenya, KLM, Korean, Tarom, Vietnam.
Accepted future members: Garuda Indonesia, Aerolíneas Argentinas, Saudi Arabian, Middle East, Xiamen.
Continue reading about Why airline alliances are good for fliers
American Airlines has finally decided to take advantage of the problems many United Airlines fliers have experienced since the merger with Continental Airlines was completed on March 3. In an extremely rare move, American is now offering conditions-free top-elite status match to United’s most loyal customers.
Having read and heard about many United customers’ troubles after the carrier adopted Continental’s reservations system — and having encountered some problems myself — I e-mailed American spokesman Tim Smith on March 16. Smith has been the best PR person to deal with at any airline since I started writing my column in the Washington Times in 2008. I asked him whether American had any intention of capitalizing on United customers’ dissatisfaction by stealing some of them away through a status-match offer.
He involved his colleague Stacey Frantz, who works directly with American’s AAdvantage program. She said she couldn’t comment on “marketing strategies,” but it was apparent from her and Smith’s messages that American wasn’t considering such a move at the time. More than a month later, however, it decided to follow my suggestion — not that I’m taking any credit.
When the promotion first started last week, elite United fliers at all levels were eligible, but on Friday, American decided to limit participation only to United Premier 1K members, the highest published level. A memo was sent out to customer service agents on that day. So if you are a 1K, you can get Executive Platinum status on American.
The carrier is not advertising the promotion, so you need to call AAdvantage Customer Service to request an e-mail outlining the offer. Status is valid through February 2013, and all you have to do is submit proof of your current elite status with United. On the rare occasions when American has offered matches in the past, it has extended challenges, meaning you had to fly a certain number of miles during a certain period to qualify. There are no conditions this time. Challenges to Executive Platinum have been even rarer than to other levels.
But is Executive Platinum better than 1K, and is American better than United? Let’s review.
Executive Platinum advantages
This is truly American’s top elite level. Concierge Key, the unpublished super status that George Clooney’s character had in “Up in the Air,” is awarded only by invitation to very few hyper-frequent and high-paying travelers. In contract, United’s Global Services status has been given to so many people — albeit still “by invitation” — that it has somewhat devalued the 1K level.
Executive Platinum members are the only ones eligible for complimentary domestic upgrades that clear as early as 100 hours before a flight — at United, all elite fliers are, and lower-level elites on full-fare tickets trump 1K members on discounted fares. United also aggressively sells domestic upgrades at check-in for as little as tens of dollars to non-elites, while elites linger on waiting lists. As a result, the upgrade rates for 1Ks have gone down significantly.
As for international — or systemwide — upgrades, American is much more generous than United. Executive Platinum members get eight of those so-called eVIP certificates each year, compared to six for 1Ks. More importantly, on American, they are valid on all published fares, while United excludes its five lowest booking classes — S, T, L, K and G — requiring at least W class. That means you need to pay hundreds of dollars more on W class, and if your upgrade doesn’t clear, you’ve wasted your money.
American has the best domestic First Class soft product. It’s the only airline to still use linens and menus during meal service, as well as pillows and blankets on transcontinental flights. United used to have linens, pillows and blankets before the merger with Continental, but it lost them. The food also tends to be better on American. Many of its domestic planes have no in-flight entertainment at all, though wi-fi has been installed on a big part of its fleet.
As an Executive Platinum, you get Emerald status on the global Oneworld alliance, which gives you access to First Class lounges on foreign Oneworld members, such as Cathay Pacific and Qantas. The Star Alliance has only two levels, instead of Oneworld’s three, so United Gold, Platinum and 1K members get the same access to Business Class lounges.
American has dedicated agents working on the Executive Platinum phone line, and they are not only the best trained agents in the airline industry, but also the ones given the most authority and discretion to help customers in any way possible, even if that means sometimes bending the rules. United’s so-called 1K Desk is not really a dedicated desk — those agents service all callers, but 1Ks get priority in the queue.
No one knows if any of the above might change as a result of American’s Chapter 11 restructuring or in a potential merger with US Airways, but this is where things stand right now. For me, American’s main disadvantages are the limits of Oneworld, whose size is about half the Star Alliance’s, the hefty fuel surcharges imposed on award tickets with British Airways flights, and those old McDonnell Douglas planes American still flies. In addition, if you live in a United hub, it might be hard to give up nonstop flights to many destinations in favor of connections on American. That said, American often offers very low fares out of United hubs, while United does the same out of American hubs.
Premier 1K advantages
United offers 1K members so-called regional upgrade certificates, which can be used to confirm an upgrade on North and Central American flights at the time of ticketing — just like using miles or systemwide upgrades. Unfortunately, this year, United reduced the regional certificates from eight to four a year. It also eliminated the two upgrades million-mile fliers used to get annually. It’s worth noting that the Executive Platinum exclusive perk of complimentary upgrades on American compensates for the lack of certificates to a large extent, though those can be confirmed only within 100 of departure.
United offers instant upgrades without requiring any “instrument” to 1Ks on domestic M fares — all elites get the same benefit on the higher Y and B fares — as soon as the time of ticketing. The inventory is controlled separately and is not the same as regular First Class availability (it books in PN class).
United waives same-day confirmed changes on domestic flights for 1Ks, while American doesn’t for Executive Platinums. United also waives award booking, change and redeposit fees on tickets issued with 1K members’ miles — regardless of who the passenger is. American does so only if the Executive Platinum member is the passenger.
United allows stopovers on round-trip international award tickets. American permits those only in U.S. gateways — the city where you leave or arrive in the United States.
The biggest advantage United has is its membership in the Star Alliance, which has 25 member-carriers, including some of the best in the world, such as All Nippon, Asiana, Singapore, Air New Zealand and Swiss.
The biggest problem with United is that its new management doesn’t value long-term loyalty nearly as much as American’s — or United’s previous leadership team, for that matter. Unfortunately, my prediction in 2010, based on warnings from departing United executives at the time, came true after the merger was finalized. The current management apparently cares much more about making a quick buck. It prefers to sell an upgrade seat from Seattle to Washington Dulles to a non-elite flier for $99, as reported on FlyerTalk by a passenger who took advantage of that offer, rather than give the seat to a 1K member who spends tens of thousands of dollars on United a year. So much for complimentary upgrades.
At the end of the day, the choice is yours. If I’ve missed anything on either airline, feel free to let me know.
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Turkish Airlines has built an impressive business lounge at its hub is Istanbul, with the best sleeping rooms I’ve seen anywhere in the world, including in First Class lounges. The best, that is, until you try to sleep — unless you don’t mind loud noise that even Bose headphones on top of earplugs can’t block out.
As I’ve written before, Turkish has made significant progress in recent years toward becoming a world-class carrier, but it’s still a long way from being anywhere close to the top. It rushes to do something it deems top-notch but doesn’t really think it through — and for high-end customers, a little glitz doesn’t sparkle brightly enough if the entire experience is inconsistent and unpredictable.
So Turkish designed these fabulous sleeping rooms in its relatively new Istanbul lounge, which are no different from really nice, albeit small, hotel rooms — with a real bed, comfortable and clean linens, desk, closet, bathrobe and slippers. But then it put shower suites right across from the sleeping-room doors, just a few feet away.
Admittedly, my first thought when I saw that setup was, “How convenient.” I used one of those rooms in the early morning hours several weeks ago after misconnecting on my way to Iraq. I took a shower and hoped to get at least three hours of sleep. Unfortunately, halfway through my rest, I was awoken by loud noise coming from passengers using the showers and staff cleaning the suites — not the actual showering and cleaning, but the talking and laughing right outside my door.
Since my earplugs were obviously not helping, I added my Bose headphones as reinforcement, even though sleeping with them is not exactly comfortable — all in vein. There was no more sleep. The glass divide that served as a wall also prevented the room from becoming sufficiently dark, but there are eyeshades for that.
At the end of the day, a great idea and superb product didn’t leave me with a great overall experience because of poor floor design and execution. Perhaps better soundproofing would have minimized the noise, if there was no way to isolate the sleeping room at least somewhat from the main lounge area. One could argue that lying in a real bed is still a luxury at an airport, even if you can’t sleep, but that’s not the point. Why not just put open beds right in the middle of the lounge? Or why have beds at all?
Two weeks earlier, I had used a sleeping room in Thai Airways’ First Class lounge in Bangkok. The rooms and beds weren’t nearly as fancy and comfortable as those in Istanbul, but the main lounge area was much farther away. Both Turkish and Thai are members of the global Star Alliance.
I suppose we can’t have it all.
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Nearly 3,000 U.S. diplomats have urged United Airlines to extend to them a waiver from its more expensive and “unfriendly” new pet travel policy that the carrier has granted the military, the diplomats’ union said. While it took United just days to exempt the military, it has been mulling the State Department’s request for weeks.
The biggest hurdle appears to be the lack of understanding by United’s management — as is the case with most people — what the Foreign Service does, and why diplomats’ service to their country is no less important than the military’s. That’s exactly why — long before this issue arose — I decided to write my upcoming book “America’s Other Army.”
“Our immediate goal is for United to extend the waiver they have granted our military colleagues to civilian federal employees traveling on official ‘permanent change of station’ orders,” said Susan Johnson, president of the American Foreign Service Association (AFSA). “This would allow federal employees assigned to embassies and missions abroad to continue to ship companion animals not eligible to travel in cabin as accompanied baggage at excess baggage rates, and makes use of professional pet shippers, freight forwarders, or cargo handlers optional.”
AFSA first sent a letter to United’s CEO Jeff Smisek on March 2, the day before the new policy took effect, Johnson said. The policy, known as PetSafe, had been used by Continental Airlines for more than decade, according to a former Continental employee whose daughter is in the Foreign Service. After the United-Continental merger was completed, the combined carrier’s pet policy followed what Continental used to do — just like almost everything else, including the reservations system, about which I wrote earlier this month. Smisek was Continental’s CEO.
Under the old policy, which was similar to that of most other airlines, pets that were too big to take in the cabin could be checked as excess luggage handled by the carrier, at an average rate of about $250 per each way. PetSafe requires that those animals be treated as cargo. In many countries, all cargo is subject to inspections and other customs formalities, which are typically handled by third-party vendors. The fees for those services range from hundreds to thousands of dollars.
Following the military’s outcry late last month, United quickly decided to allow personnel traveling to a new station to check pets as luggage and avoid a third-party provider — and the higher fees. However, United spokeswoman Mary Ryan said in an e-mail message, “We do not have plans to extend this exemption to anyone beyond military members who are traveling on orders or permanent change of station only.”
Mike Oslansky, senior manager for cargo marketing, customer service and business systems, responded to AFSA’s letter to Smisek, saying that United developed the waiver for the military “in recognition of the commitment made by members of our military and the family members (including the four-legged ones) who share in their sacrifice” and intends to limit this “special process” to military families only, Johnson said.
It seems United’s management doesn’t think that American diplomats make any sacrifices when serving in Iraq, Afghanistan, Pakistan, Sudan, the Congo and many other extremely dangerous places. Not all diplomats are posted to London and Paris — not that those “cushy” in most people’s minds posts are not dangerous, judging by the 2005 London terrorist attacks or last week’s murders in the French city of Toulouse.
By many accounts, PetSafe has been very successful domestically. United takes care of the pets without using third-party vendors, it automatically transfers the animals to connecting flights on its own aircraft and keeps them in air-conditioned facilities during layovers. Although the pets are checked in as cargo, there are no customs or other bureaucratic formalities, so the service is not too expensive.
However, that doesn’t work internationally most of the time. Very few diplomats take a nonstop flight to their new post. In some cases, they make two or even three connections. In each city, they are now forced to leave the passenger terminal, walk or take a taxi to the cargo terminal, collect their pets, recheck them in — often on a different airline, which could add more fees — then return to the passenger terminal, go through security again, and finally arrive at their next gate. By the time all that happens, they may well miss their connecting flight. Even worse if a single parent with small children is trying to accomplish those tasks.
Because of the so-called Fly America Act, the federal government must book its employees on U.S. carriers — on full-fare tickets. Foreign Service members and their families often end up on United, and many of them are elite MileagePlus members. The State Department and its 50,000 employees around the world have supported United for decades. Not to mention that one of the missions of the Foreign Service is to help create and expand business opportunities for U.S. companies, and airlines tend to benefit from that significantly.
The State Department is not seeking a waiver from the new policy for all 50,000 employees. In fact, more than 30,000 are locally hired foreign nationals who don’t travel as much as the American officials. At issue are only the 12,000 Foreign Service members — a fraction of the overseas military personnel — and only when they change posts, not Washington-based officials who may travel several times a month. After all, anyone moving from Bolivia to Uganda would find PetSafe very challenging, indeed.
Patrick Kennedy, undersecretary of state for management, has spoken with Marc Anderson, United’s senior vice president of corporate and government affairs, Johnson said, but that conversation has yet to produce results. More than 2,800 AFSA members have sent e-mail messages to Smisek and other United executives, she added.
“I love the Foreign Service,” an officer in Southeast Asia told me, “but moving my family is getting harder and harder.”
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The decision by United Airlines’ management to use Continental’s Shares reservations system for the merged carrier has been causing serious problems since its implementation last weekend. So the news that the airline is working on a new version of its IT platform, integrating some of the features of the pre-merger United’s Apollo system, is very welcome, indeed.
It was hardly surprising that CEO Jeff Smisek and his team chose to keep Shares, given that most policies and practices of the combined carrier have followed the way Continental did business under Smisek. But in this case, the decision made good financial sense — Continental has owned Shares for years, while United paid Travelport, the company that owns Apollo.
As I completed the last research trip for my upcoming book on the U.S. Foreign Service on Sunday, I was worried much less than many passengers and United employees, who had warned me not to fly during the first days of the integrated system. The merger was first announced in May 2010, so the company surely had plenty of time to prepare — and if not, it would have delayed integration, I thought.
I was wrong. On the first day of the new era, March 3, I monitored the situation from Frankfurt, where I overnighted on my way back from Iraq. Delays were widespread, which the United employees I talked to the next day attributed largely to their inability to board passengers automatically by scanning boarding passes — each person had to be boarded manually.
The other reason for the problems was how unprepared pre-merger United agents were to use Shares. They had been trained, but obviously not quite enough — actually, it may be more a matter of experience than training.
The real issue is Shares’ complexity, clumsiness, use-unfriendliness and lack of intuitiveness compared to Apollo. That was my first impression when I initially looked at it at three different airports, and it was confirmed by several longtime United employees, some of whom showed me long multiple-page instructions for basic functions, which resembled complex formulas.
Some agents are still having trouble printing boarding passes for flights for which I’d checked in online — one said, “It would have taken me five seconds in Apollo.” Others find it challenging to decipher seat maps.
I didn’t want to make a final judgment on Shares without consulting Continental employees, who have been using the system for years, and I had a chance to do that yesterday. Those agents had been sent to pre-merger United stations to help their inexperienced new colleagues — but from what I could see, there was much more demand than supply.
Those Continental agents, who also had some knowledge of Apollo, agreed with my first impressions of Shares. They also told me that Continental hadn’t invested much in modernizing Shares, but that was about to change. In a few months, they said, there will be a new version combining current features with some of the best Apollo functions.
One can only hope. The question is, why couldn’t integration wait until then? Those poor pre-merger United agents have to learn one system now, and another — apparently less complicated — in a few months?
I asked a corporate contact at United about the new plans and received the following response: “I think you’ve been hearing about a new GUI [graphical user interface] that will be added to Shares later this year. It will make it more user-friendly for our agents. We didn’t want to postpone the customer benefits that were gained by going to one passenger service system — one frequent-flier program, one website, any agent able to help any customer, etc. — by waiting until the GUI was in place.”
A task of this magnitude will always be accompanied by problems, especially at the world’s largest airline. At least for me, however, those problems have been much worse than I expected. Perhaps this is due in part to the higher numbers of pre-merger United employees compared to Continental’s — after all, United was the bigger airline.
Shares is incapable of performing some vital functions that Apollo offered. For example, upgrades using miles or certificates can no longer be waitlisted less than 24 hours before departure. So if your international flight, which you have upgraded with miles, is canceled and you are rebooked on another flight, you won’t be put on an upgrade waitlist on the day of travel. If, however, there is an available upgrade seat, you should be able to get it.
Another problem that is affecting thousands of passengers has to do with upgrades waitlisted in Apollo before the conversion. All segments waitlisted in NF booking class, which United used for upgrades to First Class, converted into ON in Shares. ON inventory exists only on three-cabin aircraft. On two-cabin planes however, the correct code is R. So if you are waitlisted in ON on a two-cabin domestic flight, you will never clear, because there will never be availability in that booking class.
United has a representative on FlyerTalk who monitors various comments, and she has indicated the carrier is aware of the incorrect conversion issue but hasn’t yet found a solution.
One of my favorite features of the old Continental website, which United’s didn’t have, was the information about where your aircraft is coming from. I was very happy it was preserved on the new site, but my happiness has been seriously tempered this week. The tool is offering plenty of erroneous data.
Just one example: Today’s flight 984 from San Francisco to Portland, OR, is operated on a Boeing 757. According to the website, the plane is coming from Monterey, CA. The problem is that the aircraft flying back from Monterey is an Embraer regional jet.
Here is the silver lining in all this: Whatever the problems at the new United, they pale in comparison to the systemic breakdowns that occurred during the US Airways-America West merger in the middle of the last decade.
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