Brilliant... or Not: The Airline Edition

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Big headlines about the airline industry have graced the front pages of newspapers, magazines and websites recently. After two years or so of profitability and the looming threat of a US recession and rising oil prices, airlines are struggling once again. Rather than raise ticket prices, airlines have been creating new fees and will soon be asking passengers to pay for a second checked bag.  The key to surviving trying times is keeping your eye on your brand, and it seems as though only a few airlines are keeping that in mind.


The Watch Out...Airline Safety Section
And in other news...Southwest Airlines flies planes not approved for air travel
Wait, what? Not cool. In a stunning revelation, Southwest Airlines admitted to flying just a few planes that weren't cleared by the FAA to fly. Come on people, like you haven't driven your car past registration before...what's the big deal? Ok ok, maybe not a great comparison and since we wrote about this in a very recent post... no need to rehash it.

Southwest has built a lot of brand equity over the years and has earned a reputation for being one of the best airlines. It'll be interesting to see how it plays out... surely time will tell.

American Airlines cancels thousands of flights
In the wake of Southwest Airlines' news, American Airlines grounded all of its MD-80 planes to check for malfunctions, resulting in thousands of flight cancellations over the course of four days in early April. Highlighting a squeeze on margins across the industry, many airlines outsource maintenance work on their airplanes, leaving the Federal Aviation Administration and their contractors to be held responsible...in theory.

Still in the end, it's American Airlines' (or insert airline name here) whose brand is on the line. While others may be at fault, AA will have to pay the bill which will be passed along to you in 22A and the snoring guy next to you in 22B.

The "Uh Oh"... Bankruptcy Section
Frontier Airlines, ATA Airlines... file for bankruptcy protection
Rising oil prices and credit woes coupled with the inability to raise prices (and still fill their planes) have forced both Frontier Airlines and ATA Airlines to seek out bankruptcy protection.

While Frontier is determined to continue flying, ATA has decided to stop all operations immediately. This led to more than a few bad headlines about stranding all types of flyers including and not limited to: members of the US Armed Services going on leave, Boy Scout troops and school field trips. In summary, not good.

Eos Airlines: Apparently taking "business class" doesn't really pay off....
No, this is not just another reason why getting an MBA might be overrated. Eos Airlines, the transatlantic  "business class only" carrier, has filed bankruptcy and (like ATA) immediately ceased operations.

It is certainly a bit alarming with all these low-fare airlines or alternative airlines going under, even though their business model seemed to be sound. It only paves the way for larger airlines to seek out mergers or partnerships to help deal with rising costs... speaking of which...

 

The "hey, let's get the band back together"... Merger Section
Delta and Northwest Merger?
Ah ha! Just as everyone pretty much said a merger was definitely, most probably, will be, certainly happening between Delta and Northwest to create America's largest airline, there is still no word on when exactly it will be completed.

Ultimately, Delta-Northwest could be good for both airlines and consumers. Hopefully, the merger fits well with all the extensive brand work Delta has invested in, because no one wants "change," as their current campaign puts it, when it means you're getting lost in the transition.

Continental "it's not you, it's me"... and it helps that American Airlines is cute.
After the Delta-Northwest announcement, everyone assumed a Continental-United Airlines merger was bound to happen. Although it appeared that Continental was genuinely interested in United, ultimately a merger just wasn't meant to be. They didn't see a future in each other; yet another high-profile breakup like Russell and Kimora, Brad and Jennifer, Reese and Ryan... heck if they can't make it, no one can.

In other news, Continental (seemingly on the rebound, yet always keeping its options open) has decided instead to pursue a polygamous partnership with American Airlines and British Airways.

For Continental, a partnership is more palatable than a merger, because each partner can maintain their brand more efficiently. For a very strong brand like Continental's, having avoided any negativity and consistently maintaining the top position when it comes to customer satisfaction, THAT is a great thing.

 

The "light at the end of the tunnel"... Not Everything's SO Bad Section
Virgin Airways flys the first flight powered by biofuels
Say what you want to say about biofuels and the fact that only one engine was fueled by it. Whether or not it ultimately becomes the next generation of fuel, the fact that a few major corporations are searching for better alternatives in light of increased consumption of fuel and increased emissions should be promising.

There will no doubt be bumps in the road as we fully realize the 360° effect of developing new fuels.  But when air travel is one of the largest contributors to global warming, it is good to see Virgin Airways taking the initiative and staying proactive, something ever so important when times are tough.

 

Delta's new seats for Coach, only 7 years in the making.
Delta has just announced a new innovative design and configuration of seats for the coach class aimed at providing more space and comfort... While we (not us personally) have seen improvements in the first class and business class seating arrangements, this is the first true modern upgrade to the back end of the plane.

Some smart people might point out that this new design - with staggered seating and a unique cocoon shape - doesn't quite allow for classic passenger improvisation such as taking up a whole aisle on an empty flight or snuggling with loved one. But when you are on those extremely packed sardine-can flights (which these days happen more often than not), these new seats would definitely improve the comfort of all air travelers.


Category : Brilliant or Not
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2 Comments

cb said:

Man, UAL is having a tough time finding themselves a partner. While a United(UAL)-US Airways proposed merger seemed ready to go a few weeks ago... it has 'officially' been put on the back burner, as both CEO's have acknowledged that a deal is not going to happen now.

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