Showing posts with label Gary Kelly. Show all posts
Showing posts with label Gary Kelly. Show all posts

Monday, January 3, 2011

Heroes and Zeroes in Travel 2010

You have your heros and you have your zeroes when it comes to leaders in the travel industry. The year just passed had an abundance of both. Here is a shortlist of people who made waves, for good or otherwise, in 2010, starting with the good guys:

HEROES

Ray LaHood, Secretary of Transportation, U.S.: Lahood, to his credit, has tried to make sense of the crazy-quilt of transportation policy. In 2010, he gave passenger rights some long-awaited teeth by approving hefty fines for U.S. domestic carriers that park planefuls of passengers on the tarmac for three hours or more on domestic flights. Coincidence or no, long waits on the tarmac fell markedly when the new rules came into effect, perhaps because airlines cancelled more flights. Long waits during the recent East Coast snow and ice storms for arriving passenger jets flown by international carriers may mean the rules could tighten for those carriers, too.

Kate Hanni, head of Flyersrights.org. Some critics say Hanni, a former realtor and singer in a rock band, has not met a camera or microphone she doesn't like. True or not, Hanni is a articulate spokesperson for the rights of air travelers, especially in the U.S., and her effective advocacy spurred airlines to be more aware of customer service and resulted in the tarmac delay fines cited above.

Kevin Mitchell, head of the Business Travel Coalition. Mitchell, whose group has represented corporate travel planners since the mid-1990s, was again a persistent and well-spoken advocate for transparency in travel, especially when it comes to air fares and disclosure of extra airline ticket fees.

Giovanni Bisignani, outgoing director general of the Geneva-based International Air Transport Association. For eight years the head of IATA, the trade group for most of the world's major airlines, the former head of Alitalia turned what had been a moribund talking-shop into a leading global advocate of fair-minded ownership rules, rational routes and pro-active steps to combat aviation's contribution to climate change.

Richard Branson. The British billionaire and chief of London's Virgin Group. For embracing fun in air travel and reviving a bit of the cheeky entrepreneurship that characterized the airline industry in earlier times.

Hero of the Year: Southwest Airlines CEO Gary Kelly, for holding out against charging stiff fees for changing flights and continuing the carrier's consumer-friendly "bags fly free'' policy in the face of escalating luggage-checking fees by nearly everyone else.

ZEROES:

Ben Baldanza, CEO of Spirit Airlines, a U.S. low-cost airline that became the first airline in the land to start charging customers for carry-on bags.

Michael O'Leary, the CEO of Ireland's ryanair. The Ebenezer Scrooge of airline executives, he called for charging passengers for using the loo. It hasn't happened yet, but even if it's a publicity stunt, it's a suggestion too far.

Zero of the Year: No contest: Steven Slater, Steven Slater, Steven Slater. The cursing, beer-snatching JetBlue flight attendant who, claiming a passenger had hit and scratched him, deployed the emergency escape shute and left his post and his job when his flight landed at New York's John F. Kennedy International Airport. An exhaustive investigation turned up no such passenger and not one person on the flight backed Slater's story. He was arrested and agreed to accept court-imposed psychological counseling.

Sunday, August 1, 2010

Southwest Thinking of International Flights? Don't

Say it ain't so, Gary. Say it ain't so.

Southwest Airlines CEO Gary Kelly let drop in a discussion of resurgent earnings last Friday that the all-domestic airline is thinking about launching international service. One word: Don't. Or is that two words? Regardless, it would be a bad move for Dallas-based Southwest - the world's largest discount carrier and the only major U.S. airline that is consistently profitable - to tamper with the brilliantly simple business plan that got to where it is today.

From its first flights in 1971, Southwest has been a model of consistency: It is no-frills, it is folksy, it has low fares, it flies entirely within the United States, usually with short-haul flights. Because it is making money, even in the Great Recession, Southwest doesn't have to nickle and dime passengers with add-on fees; it is the only U.S. major that allows customers to check two bags free of charge, and its witty "Bags Fly Free'' ad campaign is great for winning friends and influencing people.

Why does Southwest think adding international routes - in this case, to Canada, Mexico and the Caribbean, not right away but maybe by 2013 - would be good? Plenty of carriers already have them, including other low-cost carriers such as JetBlue Airways. News accounts didn't make it clear what Kelly and cohorts are thinking, giving rise to the suspicion - at least for me - that they're thinking of going international because they can, and because the airline has stopped growing in the U.S. In 2009, Southwest trimmed capacity 5 percent - less than competitors who cut even more and took to parking unused planes in the desert. Growth, however, is very much part of the corporate culture in the company that Herb Kelleher built.

"We'll be looking for opportunities to grow, and we're still a growth company,'' Bloomberg quotes Kelly as saying. "It's just that, right now, we don't see the wisdom of doing that.''

It's hard to see the wisdom of flying internationally. Such routes are typically longer than the short hops Southwest is used to taking. Already, flying coast-to-coast on Southwest, with multiple stops and changes of planes, feels like taking a Conestoga wagon with wings. The no-frills thing works fine on short-hauls; typically, people on long-haul flights over oceans and continents want creature comforts. Maybe the shrewd executives at Southwest have some wisdom they're not sharing, but fixing something that doesn't seem broken is seldom a good idea.

In the meantime - gangway! -the juggernaut rolls on. Southwest earned a second-quarter 2010 profit that more than tripled - to $216 million USD from $59 million - over the weak second quarter in 2009. Earnings jumped to 29 cents a share from 8 cents a share a year earlier.