Random Airline News That I’d Be Remiss Not To Cover

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Related posts:
–10 Random Links
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–Random Posts You May Have Missed If You’re Not On DDF…

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-I’ve gotten 2 reports today from people who skipped the final leg on their USAirways Israel glitch tickets and credited their miles to United only to have had the miles taken back weeks later. They did post properly on United.com but the flights were deleted later on.
Might be worth flying to Toronto and taking an Avios flight home if you want to keep those miles. Otherwise just be happy with an ultra-cheap ticket that just didn’t earn miles.

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-El Al CEO Elyezer Shkedi resigns and says that not flying to Turkey can be the end of El Al.
Turkey refuses to allow El Al security in their airport, thus El Al won’t fly there.
Turkish flies to Tel Aviv several times per day.

Shkedi insinuates that El Al needs to the Tel Aviv-Istanbul route to stay afloat. This is malarkey.
El Al is getting beat by Turkish but that has nothing to do with flights to Istanbul. Turkish is charging much less for connecting customers to go to Israel than El Al is. Flights from the US to Israel have never been cheaper thanks to Turkish’s low fares. Price-conscious passengers could care less where the flight connects.

El Al would gain nothing by flying to Istanbul. They have no partners there that could bring passengers to points further.

Of course El Al’s real objective here isn’t to get to fly to Istanbul but to have Turkish carriers banned from flying to Tel Aviv. Prices between the US and Israel would shoot up overnight and pad El Al’s pockets.

But it would become much harder for average Americans to afford the flights to Israel.
For a family of 8 on a budget a trip to Israel at $650/each may be feasible but at $1,200/each would be impossible.
People that can afford the nonstop will likely fly nonstop anyway, Turkish is picking up the fringe people that otherwise wouldn’t go. And they’re making Air Canada, Delta, and United prices much more affordable from every city besides NYC, making even more people afford the journey.

So yes, Turkish is doing great things for Israel’s tourist industry.  What has El Al done lately? Oh the irony…

When longtime DDF/FT member damaxer91 met Shkedi on a flight the impression was one of a nice guy who was absolutely clueless about the airline industry. I’m not surprised.

Instead of making excuses it would be nice if El Al’s new CEO brought some real change:
-El Al doesn’t compete on price, service, or product right now. They need to figure out where to excel.
-Israel now pays for El Al’s security costs. Now is the time to tackle labor costs head-on. El Al has far too many employees and managers per aircraft that they own, far and beyond the worldwide average. The unions will be the real death of El Al unless they can be tamed.
-El Al is the only airline that flies direct between North America and Israel without 180 degree lie-flat seats in business class. They ought to ditch first class as everyone else already has and focus on making business class something that will sell itself instead of something travel agents push on people because El Al pays top dollar to them to get those seats filled.
-Their Matmid program needs to be scrubbed and redone from the bottom up. It’s confusing, it’s not rewarding, and it stinks. Hire an executive familiar with loyalty programs and how mileage programs have created billions of dollars of annual revenue for other airlines and make a program that everyone will want to earn miles with.
-In the past Shkedi has said that the alliances were being anti-semitic and refused to allow El Al to join. It was quite a claim. But regardless of its veracity El Al can safely forget about alliances as they are slowly becoming things of the past anyway. Create strategic partnerships with more airlines and have it all tied into a new Matmid program that earns real miles like every other network carrier in the world. Ditch annoyance aspects like expiring points even with activity and fuel surcharges, and have robust partner options. People will then be happy to collect El Al miles while banks fill El Al’s coffers with cold hard cash.
-The El Al website needs to thrown away and redone from the bottom up as well.  How is it that the flagship airline of such a high-tech country seems like it was designed by amateurs?

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-El Al is finally releasing a co-branded credit card in Israel.
Welcome to 1995. How come I have the feeling it will stink?

I’m not anti-El Al folks. I’m just aghast at how poorly it’s run. Hire the right folks to right that ship before it’s too late.
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-El Al is launching a low-cost airline called “Up.”
Up will offer cheap flights to select cities in Europe. Budapest and Prague will start at $69. Laranca, Kiev, and Berlin/SXF will start at $99. Extra charges for luggage, seat assignments, economy plus, etc.

However Up seems to have the same ridiculously high cost structure as El Al. Fly it now if you want as it won’t stick around long. Continental (Lite, 93-95), Delta (Song, 03-06), United (Ted 04-09), and USAirways (MetroJet 98-01) have all tried to create airlines to compete with the low-cost carriers and they’ve all failed miserably and shut down.
Airlines with high cost structures can’t compete on price with airlines that have ultra-low cost structures. It also creates brand confusion that can cause damage to the parent airline.

El Al seems to have a hard time running one business model properly, let’s see how they do with 2…

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-As anyone not living on Mars already knows, a Rabbi sued Northwest/Delta for closing his mileage account several years ago.
He had top-tier elite status with Northwest and complained about a third of the flights he took. That earned his lots of compensation…until Northwest closed his mileage account due to excessive complaints.
Why didn’t Northwest just stop compensating? Beats me, but airlines can do as they want. Hard to have too much sympathy for someone that complains so much.

Under the deregulation act airlines aren’t subject to state contract law.
Of course mileage programs have grown far beyond earning miles from flying, so this case is a terrible test case for modern mileage programs. The only reason that the case has made it to the supreme court without being settled is that the Rabbi is in a terribly unsympathetic position. With it the airlines hope for a ruling that mileage programs aren’t under subject to state contract law. We’ll find out in June.

Of course that still leaves the door open to someone who had miles all earned from credit card usage confiscated for selling them. After all these programs have less and less to do with flying and act more like side businesses that generate big bucks selling miles to thousands of partners.

Then again I’m still waiting to see the case of someone suing an airline for cancelling a ticket of sick child on suspicion of it being sold. Now that would make for a much more sympathetic case for the plaintiff. The airline would be sure to shell out big bucks to have that one settled quickly and quietly, probably with an NDA to boot so that we’ll never know about it. So, who’s going to bait them 😉

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–El Al has finally opens a lounge in Newark.
Which is great for business and first class customers, but how about 180 degree lie-flat seats in business class? Hard product sells more seats than lounges do.

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-The longest flight in the world, Newark-Singapore, ended last month for good.
I’m happy I was able to fly it to the Maldives earlier this year before it ended. One of my favorite flights ever. Here was the trip report.
I may not have been around for Concorde, but I was in the air for 19 hours in a nearly empty cabin.

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-Effective 03/22/14 you will no longer be able to use your AMEX Platinum card to access American and USAirways lounges.
That’s a huge loss for the card.
Some people have been sent emails telling them of the news and offering them $200 or $500 to spend on American and USAirways next year to make up for it though I haven’t gotten a thing yet.
What does the card still have?
-You still get access (along with your entire family or 2 guests) to Delta lounges when flying Delta. This works even if your card is inactive.
-You still get free access (along with your entire family or 2 guests) to Airspace lounges in Baltimore, Cleveland, and JFK. More Airspace lounges are set to open as well. These also work even if your card is inactive.
-You still get a free Priority Pass membership which for now gives free access to USAirways lounges. It also gives access to hundreds of other lounges worldwide. However priority pass only gives free access to the cardholder. Additional cardholders do qualify (and you can get 3 additional Platinum cards for just $58 each)
-American Express is in the process of opening their own network of lounges to replace the loss of American and USAirways and they are getting rave reviews. Lounges are already open in Dallas and Las Vegas and lounges in LaGuardia and San Francisco are up next with more locations to follow. Centurion lounges have premium drinks, food, and in Dallas you can even get a 15 minute clothes-on massage. If anyone tries getting them to order kosher food in a lounge I’d love to hear about it.

Other card benefits remain in place:
-1 free year of Amazon Prime membership when you open a new card (This is actually a new benefit and also applies to the Blue Cash Everyday and Blue Cash Preferred cards)
-$200 of airline fee credits (or airline gift cards in $100 increments) per calendar year for $400 cash back which covers almost all of the $450 annual fee).
-$100 global entry expedited customs (5 year membership) refund.
-Other benefits include Starwood gold elite status (with a point rebate even on award stays), car rental perks at Avis, Hertz, and National, lost item refund protection (up to $10,000 per lost item), checked baggage protection, no foreign exchange fees, and more.
There is a $450 annual fee. As with all annual fees they are refundable if cancelled within 60 days, they are pro-rated if cancelled after 60 days and have another American Express card (i.e. if you have the card for 3 months and then cancel you would get a $337.50 refund), and they are pro-rated if you downgrade the card even if you have no other American Express card.

As TBB correctly notes in the comments, you can also get Hilton Gold good through 02/28/15 by calling the number on the back of your Platinum card by 12/31/13.