Tag: AIR

The average price of a U.S. domestic roundtrip ticket
declined again in November versus a year prior, according to Airlines Reporting
Corp.’s latest report.

Following October’s 4 percent year-over-year decline,
November’s fare was $547, down 2 percent compared with October 2022. The fare
also was down 2 percent on a month-over-month basis.

Total November 2023 U.S. air ticket sales were up 3.4
percent year over year to nearly $6.8 billion but were down 6.6 percent
compared with October 2023. The number of passenger trips were up 7.5 percent
compared with November 2022 to nearly 20.5 million, but they too were down about
5.6 percent month over month.

“U.S. consumers continue to spend on international air
travel,” ARC chief commercial officer Steve Solomon said in a statement.
“Our data reflects a slight increase in international passenger trips from
October to November, which is uncommon for the time of year. Despite seeing the
typical declines in month-over-month air travel sales and passenger trips,
airlines reported a record number of travelers for the Thanksgiving holiday
season.”

The number of November U.S. domestic trips was up 7.4
percent year over year to nearly 12.9 million, however they were down about 9
percent compared with October 2023. International trips were the only metric to
increase both by year and by month. They were up nearly 7.6 percent year over
year to nearly 7.6 million and were up 1.2 percent month over month.

November electronic miscellaneous document sales, which
include fees for such ancillary products as upgraded seats and checked bags,
increased 43.2 percent year over year to more than $22.5 million, and were up
about 6.6 percent month over month. Ancillary transactions were up 4.7 percent
versus November 2022 to nearly 380,000. They also were up about 4.1 percent
month over month.

RELATED:  ARC:
October U.S. Air Ticket Sales Continue to Dip

The U.S. Department of Transportation has levied a $140 million civil penalty against Southwest Airlines for “numerous violations of consumer protection laws” during its 2022 holiday operational disruptions, which resulted in about 16,900 canceled flights, affecting more than 2 million passengers, the agency announced Monday.

DOT found that Southwest violated consumer protection laws by failing to provide adequate customer service assistance, failing to provide prompt flight status notifications, and failing to provide refunds in a prompt and proper manner. 

The penalty is 30 times larger than any previous DOT penalty for consumer protection violations, according to the agency. 

The full $140 million, however, will not necessarily come out of Southwest’s coffers. A DOT consent order stated that $35 million would be paid to the U.S. Treasury over a three-year period. But the $105 million balance involves credits and offsets, including $33 million for “past compensation that was above and beyond existing requirements” when the carrier issued 25,000 Rapid Rewards points to affected travelers. Southwest also paid out more than $600 million in refunds and reimbursements because of the disruptions.

The remaining $72 million will go toward compensating future Southwest passengers affected by cancellations or significant delays caused by the carrier via vouchers. Southwest will offer $30 million per year in vouchers for each of three years between April 30, 2024, and April 29, 2027, that are transferable and can be used for future domestic or international travel on the carrier. Any residual value of the voucher after use must remain available to consumers within the validity period, according to the consent order. The vouchers shall remain valid for at least one year after the issue date. 

Southwest, however, will receive an offset of $24 million of the $30 million issued in vouchers per year. If the carrier during a one-year period does not issue $30 million worth of vouchers, Southwest must pay the U.S. Treasury 80 percent of the difference between what was issued and the $30 million. 

“Today’s action sets a new precedent and sends a clear message: If airlines fail their passengers, we will use the full extent of our authority to hold them accountable,” DOT Secretary Pete Buttigieg said in a statement. “This penalty should put all airlines on notice to take every step possible to ensure that a meltdown like this never happens again.”

Southwest announced the DOT settlement as well, and in the consent order noted that it “sincerely regrets the inconvenience caused to all customers who were affected by the operational disruption” and that it “takes very seriously its responsibility to comply with all laws and regulations.” 

The carrier, though, disagreed with DOT’s position that it violated consumer protection laws. Southwest “notes that it enters into this agreement for settlement purposes only and does not admit any violation of any statute or regulation or concede the DOT’s recitation of the facts and conclusions,” according to the consent order. “Southwest strongly believes that it fully complied with all applicable laws.”

During the middle of the disrupted period, Southwest took actions to course-correct its operations and since has worked to improve its winter operations, including adding more deicing trucks, pads and ground equipment. It also “improved tools and procedures to streamline communication and decision-making,” and it accelerated investments in tools and technology, including the software used to reassign its crews during disruptions.

“We have spent the past year acutely focused on efforts to enhance the customer experience with significant investments and initiatives that accelerate operational resiliency, enhance cross-team collaboration and bolster overall preparedness for winter operations,” Southwest president and CEO Bob Jordan said in a statement. 

Turkish Airlines has placed an order for 150 single-aisle Airbus A321s and 70 A350 widebody aircraft, with an option for 135 more Airbus planes to be delivered over roughly the next decade. The move is part of a 10-year strategic plan in which the carrier aims to grow its fleet to more than 800 aircraft
by 2033 and its passenger network to 400 destinations, with expansions in Asia, Europe and North America.

The deal, which has been in the works for several weeks, will also support Turkish Airlines’ sustainability goals, with more fuel-efficient aircraft serving both long- and short-haul routes. 

Turkish Airlines
chairman of the board Ahmet Bolat called the the investment “a crucial milestone
in the further evolution of Türkiye’s aviation industry.” He continued: “By modernizing our
fleet with more efficient and environmentally friendly aircraft, we are
reinforcing our leading position in global aviation and contributing to the
nation’s prominence as an aviation hub.”

Turkish Airlines’ hub Istanbul Airport served 58 million passengers through September 2023, according to CAPA, representing more than 21 percent growth over 2022. The massive Airbus order will position the carrier to capitalize on post-pandemic spikes in international travel. 

The aggregate November on-time performance for North American carriers increased for a fourth month in a row, according to Cirium’s latest monthly report. On-time percentage in November increased 1.8 percentage points to 81.9 percent compared with October’s 2.8 percentage-point increase.

All but two qualifying carriers showed month-over-month improvement: Alaska Airlines’ on-time performance dipped 1.6 percentage points to 84.5 percent—still above the weighted average of North American carriers—and Spirit Airlines’ performance dropped nearly six points to 81 percent. 

In November, Southwest showed the sharpest month-over-month improvement, with a 6.1 percentage-point increase to 84.5 percent. All surveyed carriers reached at least 75 percent in November, except Air Canada, which was just shy at 74.9 percent.

[Report continues below chart.]

Delta Air Lines in November again maintained its position at the top of the list with on-time performance of 91.3 percent, the highest any North American airline has recorded since at least January 2022. United Airlines was second at 88.4 percent, with American Airlines in third at 86.7 percent. 

Delta, United and American, in that order, also topped the November on-time performance list among all airlines globally. No other North American carrier landed in the global top 10.

North American airlines in November canceled 2,644 flights, down about 43 percent month over month. Each of the top five carriers on the North American on-time list completed at least 99.5 percent of their flights in November, led by Delta at 99.93 percent, according to Cirium.

A flight is considered on time if the aircraft arrives at the gate within 15 minutes of the scheduled arrival time.

United Airlines’ decision to limit bookings through its
PerksPlus small business loyalty program only to those clients booking through
travel management companies is a first step to sunsetting the product and
moving all business customers to the carrier’s United for Business platform, United
VP of sales strategy and effectiveness Glenn Hollister told BTN on Monday.

The carrier last
week in a client memo announced that as of Feb. 1, 2024, bookings through
PerksPlus, which allows business customers to accrue and redeem loyalty points
for flights taken, would be “exclusively available to corporate customers
booking through a travel agency.”

Hollister, though, said that the move was designed neither
to dissuade direct booking nor promote TMC use, but instead was the beginning
of an effort to move customers off the PerksPlus platform in favor of its
United for Business portal, which he said offered richer, more flexible
functionality.

Calling PerksPlus “quite old, limited in functionality
and inflexible,” Hollister said the move was the next step in a years-long
effort by United to overhaul its corporate programs, including the launch and
refinement of United for Business and the debut of the Blueprint
request-for-proposals platform. 

“The move is the first step of several that will end up
with us ultimately sunsetting the Perks Plus program and platform entirely and
moving all customers onto United for Business,” Hollister said. “We
have started with our direct-only customers because those are the easiest ones
to move.”

United for Business requires additional technological
development to “build in the functionality so that agency-supported
customers also have the range of options about program types and rewards, and
being able to earn those through agencies,” Hollister said. That process
“probably” would be complete in 2025, he said. 

“Eventually everything that a corporate customer or
agency partner would need will be in United for Business,” Hollister said.
“It’s a multi-year journey to get everything there, but we want to end up
in the place where no matter who you are or what you need, if you have some
kind of a b-to-b relationship, you’re going to United for Business.”

Adam Keeter, director of United for Business product and
alliance strategy, said he “wouldn’t expect any seismic changes” for
the carrier’s other business products in 2024.

As for PerksPlus, Keeter said the carrier made
no changes to the program, including point accrual or redemption levels or the included
eligibility of such United partner carriers as Lufthansa and All Nippon
Airways, beyond the requirement for an agency. Though customers booking direct
through PerksPlus will be unable to accrue points beginning Feb. 1, they can
redeem points before they expire Jan. 31, 2026, he said.