Oneworld
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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Continue reading about American tries to entice top United fliers
One of this column’s goals is to point out nuisances in the air travel system and help you avoid them or minimize their negative impact. As I welcome the many readers who have become subscribers since my book, “Decoding Air Travel,” came out, I’d like to tell you about one such nuisance.
As my regular readers are well aware by now, I always know in what booking class a future ticket will be issued. I search for availability in that booking class and choose flights with available seats. That’s why, even if I have to make a reservations with an agent on the phone, I know how much the ticket will cost before I make the call.
The only time when this strategy fails is when I need an airline to book a seat on a partner-carrier, and the ticketing airline’s agent can’t “see” availability in the respective booking class in the partner’s inventory. I’m not talking about award seats, so comparisons with United’s StarNet blocking practice would be misplaced — this is about revenue tickets fully paid for with money, not miles.
So why don’t agents see availability in a certain booking class or fare bucket on another carrier? It usually has to do with the Global Distribution System (GDS) they use to book tickets. For example, United currently uses Apollo and Lufthansa Amadeus. Although most of the time the two systems show identical data, there may be occasional delays, and a United agent may not see a Lufthansa seat displayed as available on Amadeus.
I can explain most things in the airline world, but British Airways and Iberia posed a new challenge last month that left me utterly perplexed. The two companies and Oneworld alliance members merged last fall, and they both use Amadeus, which would mean that their agents should see the same data on their screens — at least it would mean so to a logically thinking person. That person, however, would be wrong.
I was booking a trip for a friend, who is also a client, from Washington to Africa in Business Class. He has Gold status with BA and wanted to fly BA to London and connect to Madrid and on to Africa on Iberia.
According to the BA website, his destination doesn’t exist — many airline sites don’t show cities they don’t fly to, but it’s high time BA added the airports served by Iberia now that they are one company. Fine, I thought, what’s the other option? Naturally, the Iberia site, as the Washington-London BA flight could be booked as an Iberia code-share. There was one problem, though: Iberia priced the desired itinerary almost $4,000 higher than BA.
Clearly, the only thing left to do was to call BA — an exercise I don’t look forward to because of the long waiting time. When I finally got an agent at BA’s call center in Jacksonville, Fla., she said there were no available seats in Business Class on Iberia’s flight from Madrid to the African destination, which I’m not revealing on purpose.
I thought she was joking. Amadeus was showing seven open seats in the full-fare Business booking class I needed, which is J class on Iberia. BA doesn’t code-share that particular flight, so it had to be booked a “true” Iberia flight number.
I started scratching my head. How was it possible for BA’s Amadeus-powered computers to show no seats at all when there were seven? Perhaps it had to do with the point of sale (POS) — I’ve seen airlines alter the inventory on the same flight, depending on where you view the data. But both the BA agent in Florida and I were in the U.S. Still, I changed the POS from the U.S. to Europe, but there was no difference. I also called Iberia to verify the seats were indeed available, and Iberia’s agent in Miami saw exactly what I did.
The BA agent tried to explain the discrepancy by telling me that Iberia hadn’t “given” BA any seats, but I immediately asked her to stop making stuff up. There is no such thing as one airline “giving seats” to another — anyone can book a seat if the operating airline has published it in its inventory, even if the second carrier is not a partner of the first.
Despite all the mystery and frustration, that wasn’t the end of the world, I thought. I asked the BA agent to waitlist the segment in question. My plan was to call back in case another agent could find a way to “see” the seat I needed, and if that failed, I would call Iberia and have them clear the waitlist, since their agent had confirmed availability earlier.
I’ve done just that with Star Alliance carriers several times. For example, Singapore Airlines tends to be stingy with D class availability on intercontinental flights. Star uses D class on round-the-world Business Class tickets, and Singapore deems those fixed fares too cheap. If I issue a ticket with another carrier, it might waitlist a Singapore segment. I’d then call Singapore and ask a supervisor to clear the waitlist if he or she found it appropriate. I’ve also done that with Lufthansa, Japan’s All Nippon Airways, South Korea’s Asiana and others.
However, that simple procedure proved too hard for the merged BA and Iberia, both of which use Amadeus, as mentioned earlier. When I called Iberia back, the agent saw available J seats but said that only BA could clear the waitlist. Except that BA couldn’t, because its agents saw no seats. The Iberia agent’s claim sounded odd, because Iberia controls its own inventory, and I thought it had a way to indicate electronically to BA that a waitlisted seat can be confirmed. So I called back but got the same response from another agent.
Then I phoned BA again and asked the agent to call Iberia, hoping the waitlist could be cleared that way. After keeping me on hold for about 20 minutes, the agent hung up without coming back on the line.
I’d had enough of both carriers’ nonsense, so I took matters in my own hands. I called Iberia yet again and asked the agent to book just that one segment in question separately from the original booking. He gave me the new record locator, and I called BA again, explained the situation and asked that agent if she could incorporate the second booking into the initial one and issue the ticket that way.
She couldn’t but a supervisor was able to do it. Part of me was grateful, but the other part was frustrated that the previous BA agents I’d spoken with never offered me the option I eventually thought of, and wasted hours of my time.
What sort of a merger have BA and Iberia created if they can’t perform the most basic airline function — booking available seats on each other’s flights?
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There must be very few things more embarrassing to an airline than losing the luggage of a passenger who paid more than $12,000 for a First Class ticket. Even more shockingly, British Airways, which did just that last week, didn’t try to right the screamingly obvious wrong and offer some sort of a good-will gesture.
Many of us often wonder who would pay $10,000 or $15,000 for a plane ticket, but let me assure you, there are such people. Premium travel has staged a remarkable recovery in recent months. As I look at flight inventory, I’m amazed every day by how full Business and First Class cabins are on various carriers.
The case in point was actually very close to home, as the passenger was a colleague whom I’d helped book his ticket. Another curious detail was that, after the ticket was issued, he needed to move his return flight a day earlier, and British Airways imposed a $750 penalty for the change — yes, on a $12,000 ticket.
He had one connection — in London, of course — on his way to another European city. Not too complicated, one might think. However, when he arrived at his final destination, his luggage was missing. It was eventually discovered in London, but although British Airways had several more flights to the city where he was that day, the luggage wasn’t delivered at his hotel until 1 a.m. the following day — 12 hours after his arrival.
Not too bad, you might say. Many passengers wait days for their bags, and some never see them again.
I may have agreed with such an attitude had the airline not collected $12,000 from the passenger for this trip. How could any self-respecting carrier not take all necessary measures to ensure that such customers’ luggage arrives on time at the right place? In the grand scheme of things, this wasn’t a huge problem, but it speaks ill of the airline — and it certainly ruins the First Class experience.
What makes things much worse is that, a week after the incident, British Airways, which is a member of the Oneworld alliance, has offered no compensation, good-will gesture or whatever one might call it. Moreover, when the customer asked for a token of appreciation in the Concorde Room, the carrier’s First Class lounge at Heathrow Airport, on his return journey, his request was rejected.
Instead, he was advised to contact Customer Relations. While that may be considered a standard procedure in the airline industry, the airport agent could have been much more helpful and not passed the responsibility to someone else.
After all, the people who pay $12,000 for a plane ticket are not that many. Any airline should try really hard to keep them as customers.
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Continue reading about British Air loses bags on $12,000 ticket
United Airlines fulfilled its promise this week by finally allowing one-way mileage awards on its partners in the global Star Alliance. More importantly, it showed that its Mileage Plus program is truly an industry leader — it didn’t follow American Airlines in taking away stopovers on award tickets, which will save travelers many frequent-flier miles.
Mileage Plus has become one of the most customer-friendly loyalty programs in the world. As odd as it sounds, offering one-way awards is a rather progressive step, given how rare it is in the industry — for no good reason. United has been offering one-way awards on its own flights since February.
Stopovers on international awards are incredibly useful — they are usually not permitted on domestic tickets. I don’t use them all the time, but I do often enough to mourn their loss on United. They are partly responsible for my visits to 82 countries.
When American banned stopovers last year, its justification was that the introduction of one-way awards eliminated the need for stopovers — one can now visit two cities or countries by booking three one-way segments. The problem for customers was that such an award now costs many more miles.
It would have been easy for United to copy American’s move. After all, taking stopovers away would have taken more miles off its books and decrease its liabilities. United has historically matched various practices initiated by its arch rival, but this time it made its own decision. Mileage Plus members should be grateful — preserving stopovers will save them tens of thousands of miles per trip.
I must admit, I was a bit confused about the stopover policy, and an earlier version of this column said United was doing away with them. I was misled by a reservations agent last weekend, and by a sentence on United’s website, saying “That means no stopovers.” It appears that only applies to one-way awards.
I received a comment from a reader who had seen a thread about the column on FlyerTalk.com, which prompted me to speak with a supervisor at Mileage Plus. He checked his resources and assured me that stopover are still permitted on round trips.
I’ve been praising Mileage Plus repeatedly since Graham Atkinson became president two years ago. In February, I wrote about all the right things Atkinson did — one negative thing he couldn’t change was the infamous StarNet award blocking. At the time, he told me that no decision had been made about stopovers.
Atkinson left United in September, as part of the management changes resulting from the merger with Continental, but I’m glad to see that his approach to customer loyalty lives on.
By the way, don’t forget the 24-hour international connection rule, which lets us do a mini-stop en route, so look for those day-long layovers if you want to sample a new country on the cheap.
Continue reading about United keeps free stopovers on awards
