Money & Company

Tracking the market and economic trends
that shape your finances.

Category: Airlines

Real Estate | Autos | Consumer | Economy

International visitors continue to spend more in U.S.

A bright spot in the nation's rebounding economy continues to shine.

International tourists are spending record amounts in the U.S., surpassing the pre-recession totals of  2008, according to the latest data from the U.S. Office of Travel and Tourism Industries.

In October, international visitors spent $13.1 billion on travel to the U.S. and for tourism-related activities while they were there, a 13% increase over October 2010, the agency said.

Travel and tourism-related spending has increased, on average, more than $1.5 billion a month in 2011 and is on pace to break the record previously set in 2008 before the global economic slowdown.

The Office of Travel and Tourism Industries expects industry-related exports to surpass $152 billion for 2011.

Four countries are expected to account for two-thirds of the projected growth in international visitation to the U.S. over the next five years. About 31% of the growth will come from Canada, 13% from Mexico, 10% from China and 7% from Brazil, the agency said.

Meanwhile, the total spent by Americans traveling abroad reached $91.9 billion in the first 10 months of 2011, an 8% increase over the same period in 2010, the agency reported.

RELATED:

Americans get less vacation, still don't use it all

'Healthy' menus up 86%, including at airport restaurants

California to pull in more than $100 billion from tourists in 2011

-- Hugo Martin

Chart: Spending by international visitors in the U.S., monthly data. Credit: U.S. Office of Travel and Tourism Industries

 

Airlines expected to increase onboard offerings

Passengers are served aboard a Delta flight.

Besides charging passengers to check luggage, the nation’s airlines have collected billions of dollars in extra revenue by turning their cabins into flying department stores.

And experts foresee big growth in such sales in the coming years.

The nation’s top airlines take in an average of nearly 12% of their revenue from onboard sales of food, drinks, online entertainment and blankets, among other items and services, according to industry studies.

In the future, airlines are likely to expand such offerings to include “destination-based attractions,” such as car rentals and hotel reservations and more entertainment options, according to a study released last week by Toronto-based GuestLogix, a provider of onboard sales technology to the world’s airlines.

The report predicts that most of the sales will be made from the entertainment system installed in the seat backs instead of from the carts that flight attendants roll down the cabin aisle.

“I think airlines are thinking about the passenger and trying to get them what they want,” said Chris Gardner, a managing director at GuestLogix.

GuestLogix found that revenue from so-called “comfort items” such as headphones, blankets, pillows and in-flight entertainment jumped 70% in the first half of 2010 compared with the same period in 2009.

Prepared meals and other fresh food generated nearly three times as much as revenue as pre-packaged snacks in the first six months of 2010 compared with the same period in 2009.

Finally, the report confirmed what many in the airline industry had long assumed: The longer the flight, the more the airline sells in on-board products and services, particularly alcoholic drinks.

On flights under 500 miles, the average sale of alcoholic drinks was about $22, compared with $71 on flights over 1,500 miles, the report found.

“The longer the flight, passengers are less likely to wait until they are on the ground to buy food or have a drink,” the report said.

RELATED:

New Year's Day has the most car thefts

Demand and fares continue to rise for the nation's airlines

Fraudulent airline ticket orders on the rise, reporting group says

-- Hugo Martin

Photo: A chef and sommelier serves passengers on Delta Air Lines. Credit: Delta Air Lines

Carry-on bag fee at Spirit Airlines a success, analyst says

Spirit Airlines passenger at check-in area

Florida-based Spirit Airlines took a heap of criticism last summer when it announced that it was going to be the first — and so far only — airline to charge passengers up to $45 in extra fees to pack carry-on luggage in its planes’ overhead compartments.

Two federal lawmakers even threatened to impose a tax on all airline revenue generated by such fees, a penalty that has yet to be adopted.

But an industry consultant on airline revenue ideas has declared Spirit’s carry-on baggage fee a major success.

In the 12-month period after Spirit launched the fee in August 2010, the airline flew 24.5% more passengers compared with the same period in 2009, according to a study by Jay Sorensen, president of IdeaWorks, a Wisconsin airline consultant.

Meanwhile, the airline reported a 10% to 12% profit margin in the nine months after the fee was added, a much higher margin than most of its larger competitors, according to the report.

“More than a year later, passenger traffic and revenue results have proven the skeptics wrong,” Sorensen said of the carry-on fee. A spokeswoman for Spirit declined to comment about the report.

Even more important than higher revenues, Sorensen said the carry-on fee has created a cost incentive for passengers to carry fewer bags into the cabin, thus speeding up the boarding process.

"Flight attendants report passenger boarding and unloading occurs far more quickly,” he said in the report. “This preserves Spirit’s desire to keep ground time at a minimum.”

RELATED:

U.S. airlines blast court ruling on European emissions plan

Some flight attendants want '30 Rock' off American Airlines

Demand and fares continue to rise for the nation's airlines

-- Hugo Martin

Photo: Jim Rader rolls his luggage away from the Spirit Airlines ticket counter after checking in for a flight at LaGuardia Airport in New York in February 2010. Credit: Daniel Acker / Bloomberg News

U.S. airlines blast court ruling on European emissions plan

Plane_getty595

The Court of Justice of the European Union upheld an emissions-reduction plan for airlines Wednesday, prompting an outcry from airlines and cheers from environmental groups.

The European emission plan would impose taxes on airlines that exceed strict emission limits when flying in and out of European countries.

U.S. airline representatives say the emission plan violates international agreements and have hinted that the tax could force airlines to increase airfares for travel to Europe.

“Today’s court decision further isolates the EU from the rest of the world and will keep in place a unilateral scheme that is counterproductive to concerted global action on aviation and climate change," according to a statement by the U.S. trade group Airlines for America, formerly known as the Air Transport Assn.

The association estimates the emission plan will cost U.S. airlines more than $3 billion through 2020.

Meanwhile, environmental groups applauded the ruling.

"It is high time airlines actually live up to their green claims and comply with the EU law, which will cut pollution and spark low-carbon innovation," said Annie Petsonk, international counsel for the Environmental Defense Fund.

The Court of Justice, Europe's highest court, ruled on the emission plan in response to a challenge by the U.S. trade group and several individual airlines.

The European Commission launched the cap-and-trade emission plan in 2005, targeting utilities, manufactures and airlines. Starting next year, greenhouse gas emissions from airlines will be capped at 97% of their average 2004-06 levels and 95% in 2013.

Airlines that don't use all their allowances can sell the excess to those carriers that exceed the limits. The cost for violating the plan is 100 euros, or about $142, for every ton of greenhouse gases that airlines emit above the limit.

RELATED:

Airlines fight EU law capping greenhouse gas emissions

Some flight attendants want '30 Rock' off American Airlines

Business travelers hate Houston and the middle seat, survey says

— Hugo Martin

Photo credit: Getty Images

Consumer Confidential: Holiday shopping, fewer fliers, gas pains

Shoppic

Here's your last-train-to-Clarksville Tuesday roundup of consumer news from around the Web:

--We're still shopping, right down to the wire. Sales at stores opened at least a year rose 3.4% for the week ended Saturday compared with the previous week, according to the International Council of Shopping Centers-Goldman Sachs Weekly Chain Store Sales Index. That follows two consecutive weekly declines as shoppers took a break after a discount-fueled spending spree over the Thanksgiving weekend. Compared with a year ago, sales for the week rose 4.6%. And there's still more shopping to do. According to a poll of 1,000 shoppers conducted by ICSC and Goldman Sachs, shoppers on average completed 70% of their holiday buying as of Sunday. Moreover, 9% of shoppers polled hadn't even started their holiday buying. Man, talk about procrastinators. (Associated Press)

--And we're still traveling, but not quite as much. The estimate for the upcoming winter holiday travel period predicts there will be fewer fliers than a year ago. A projected 43.3 million air travelers will fly on U.S. carriers for both domestic and international routes during a 21-day period, according to Airlines for America, the industry trade organization for the leading U.S. airlines. That's a 1% drop from the same period last year, which translates to about 20,000 fewer passengers on average per day. However, travelers will not find that translates into more leg room once they board planes. On the busiest days, flights will be filled to at least 85% capacity, according to the forecast. (CNN)

--Feeling a bite out of your earnings? That's your gasoline bill talking. Despite the fact that gas prices have been falling in recent weeks, the fact is consumers have spent more money on gas this year than any other, according to the Oil Price Information Service. As of mid-December, gas prices have averaged $3.52 per gallon. Based on recent demand trends, the total consumers will have spent on gas this year should be about $481 billion. Last year, motorists spent a total of $389 billion on gas, according to OPIS. When all of this data is broken down, each American household will have spent an average of $4,155 on gasoline 2011, approximately 8.4% of an average family's income. Ouch. (ConsumerAffairs.com)

-- David Lazarus

Photo: Polls show Americans still have plenty of holiday shopping to do. Credit: Mark Boster / Los Angeles Times

 

Some flight attendants want '30 Rock' off American Airlines

Alec Baldwin on "Saturday Night Live"

Actor Alec Baldwin was thrown off an American Airlines flight this month after a fracas involving his cellphone. But now some flight attendants want his television show booted from the airline.

Baldwin was supposed to take a Dec. 6 flight from Los Angeles to New York but got kicked off the plane because he refused to stop playing a game on his cellphone as the flight was about the depart. He also slammed the door to the plane’s bathroom. In a statement, the airline said he violated Federal Aviation Administration rules and “was extremely rude to the crew.”

Baldwin, who stars in the NBC comedy “30 Rock,” later made fun of the controversy when he appeared on "Saturday Night Live" dressed as an American Airlines pilot. He also vowed not to fly on American again.

But the airline’s flight attendants are not laughing. Several members of the Assn. of Professional Flight Attendants have asked American to stop showing episodes of “30 Rock” on the airline’s onboard entertainment systems until Baldwin apologizes.

For now, American says it will continue to show “30 Rock” on its flights.

RELATED:

Christmas and New Year's travel numbers expected to grow slightly

Demand and fares continue to rise for the nation's airlines

Fraudulent airline ticket orders on the rise, reporting group says

-- Hugo Martin

Photo: Alec Baldwin, left, and Seth Meyers on "Saturday Night Live." Credit: NBC

Business travelers hate Houston and the middle seat, survey says

Business-class passengers on a United flight to Hawaii.

Imagine a business trip that starts with a delayed flight to Houston. On the flight you must sit in the middle seat next to a sick passenger or perhaps a crying baby. When you check into your hotel, your bed is a mess of bedbugs and dirty linen.

These horrific business trip scenarios emerge from an online survey of 3,756 business travelers who were asked to choose their least favorite city to visit and cite the top reasons they hate to travel.

But the source of the survey data might be biased on the subject. ON24, a San Francisco provider of virtual meetings and webcasting technology, conducted the survey to promote online meetings over face-to-face business trips.

When it comes to picking least favorite cities to visit for a convention or trade show, Houston got the most votes, with 49% of the survey respondents, and Los Angeles came in second with nearly 42%.

Asked to list their top travel gripe, 53% chose sitting in an airplane middle seat, 51% said having their flight delayed and 43% chose getting stuck next to a sick passenger or a baby.

When it comes to lodging, nearly 53% said they were concerned about sleeping in a room with bedbugs and 45% worry about dirty linen.

When asked what they dislike about trade shows and conventions, more than 60% cited boring presentations. Nearly 20% said they disliked a common trade show sight — attractive women who staff show exhibits, often known as “booth babes.”

RELATED:

Christmas and New Year's travel numbers expected to grow slightly

Demand and fares continue to rise for the nation's airlines

American Airlines' parent company owns $30-million town house

-- Hugo Martin

Photo: Business-class passengers on a United flight to Hawaii. Credit: Richard Derk / For The Times

First 11 months of 2011 were safest for air travel since 1945

An American Airlines plane takes off from Los Angeles International Airport

If you suffer from a fear of flying, here’s something that might calm your nerves: The first 11 months of 2011 have been the safest period for commercial air travel since 1945.

The global accident rate for January through November was 22% better than the same time last year and marked the safest period since a United Nations aviation agency began collecting data in 1945, according to the International Air Transport Assn., an airline trade group that issued a recent safety report based on the UN data.

Globally, there have been 486 passenger and crew fatalities in the first 11 months of the year, down from 784 fatalities in the same period last year, according to the trade group. In the first 11 months of 2011, the accident rate was 2.16 per million passenger takeoffs, down from 2.78 per million in the same period last year.

The most common accidents this year have been “runway excursions,” which occur when airplanes veer off or overrun the runway. Such incidents represented 23% of all accidents in that period, according to the report.

A spokesman for the trade group said he didn’t know why the first 11 months have been so safe but added that several changes over the years have improved overall aviation safety.

For example, IATA spokesman Perry Flint said manufacturers now build more reliable airplanes that include backup safety systems. He added that more countries are adopting international safety standards and annual safety audits.

“In general,” Flint said, “the safety trend line is moving in the right direction.”

RELATED:

Christmas and New Year's travel numbers expected to grow slightly

American Airlines' parent company owns $30-million town house

Airlines trade group predicts global profits to shrink in 2012

-- Hugo Martin

Photo: A plane takes off from Los Angeles International Airport. Credit: Los Angeles Times. 

Christmas and New Year's travel numbers expected to grow slightly

 

Christmas and New Year's travel numbers expected to increase slightly

With gasoline prices dropping, the Automobile Club of Southern California predicts that the number of Southern Californians traveling for the Christmas and New Year's holidays will increase slightly over last year.

For the end-of-the-year holidays, the Auto Club says 7.13 million Southland residents will travel at least 50 miles, a 1.4% increase over last year.

Of those holiday travelers who will take trips between Dec. 23 and Jan. 2, 90%, or 6.3 million, will travel by car. That’s a 2.5% increase over last year.

Gasoline prices have been dropping in recent weeks. But the price of a gallon of regular gas, ranging from about $3.50 to $3.65 a gallon in Southern California, is still 30 cents higher than at this time last year, according to the Auto Club.

Nationally, 91.9 million Americans are expected to take end-of-the-year getaways, also a 1.4% increase over last year.

“In a positive sign for the economy, the number of travelers for this holiday period is expected to increase despite higher costs for gas and airfares,” said Filomena Andre, the Auto Club’s vice president for travel products and services.

The most popular destinations for Southern Californians over the Christmas and New Year holidays, according to Auto Club travel agents, are:

1) Las Vegas

2) San Diego

3) San Francisco

4) Grand Canyon

5) Anaheim (Disneyland)

RELATED:

New Year's Day has the most car thefts

Demand and fares continue to rise for the nation's airlines

Fraudulent airline ticket orders on the rise, reporting group says

-- Hugo Martin

Photo: Los Angeles highway traffic. Credit: Los Angeles Times

American Airlines' parent company owns $30-million town house

AMERICAN-AIRLINES-HOUSE_Reuters

Despite filing for bankruptcy last month, the parent company of American Airlines owns a $30-million town house in an upscale London neighborhood, according to bankruptcy documents.

And the flight attendants that work at the bankrupt airline are seeing red.

The president of the union that represents 18,000 American Airlines flight attendants issued a message to its members Wednesday, calling news of the apartment ownership "offensive" and "wrong."

Reuters news service reported Wednesday that the five-bedroom town house in London's high-end Kensington district was one of eight properties declared in bankruptcy papers by parent company AMR Corp.

In a statement issued Wednesday, Laura Glading, president of the Assn. of Professional Flight Attendants, suggested that lavish spending by AMR executives lead to the bankruptcy.

"If AMR executives had put as much thought and effort into maintaining what was for decades one of the most successful airlines in the world as they did into maintaining their own lifestyles of the rich and famous, American Airlines would not be in the position it is in today," she wrote in a message to members.

The message also announced several meetings to address the bankruptcy over the next three weeks.

RELATED:

Southwest Airlines sued over drink coupons

Parent of American Airlines files for bankruptcy

Airlines trade group predicts global profits to shrink in 2012

-- Hugo Martin

Photo: The $30-million London apartment owned by airline parent company, AMR. Credit: Reuters.

Consumer Confidential: Holiday travel, higher airfares, Acura redux

Trafficpic
Here's your watching-the-detectives Wednesday roundup of consumer news from around the Web:

— Downturn, shmownturn. Despite continued worries about the economy, more Americans are expected to hit the highway this holiday season. AAA says it expects 91.9 million Americans — about 30% of the population — to travel at least 50 miles from home during the 11-day, year-end holiday season. That's up 1.4% from a year ago, making it the second-highest travel volume in the past 10 years. The majority (about 91%) of travelers are expected to venture forth by automobile, a 2.1% increase from a year ago. That comes in the face of high prices at the pump, with gas prices 29 cents higher than a year ago. On the other hand, air travel is expected to decline slightly. (CNN Money)

— And there's a reason for that. If you thought it was more expensive to fly this year, you're right. Average domestic airfares rose to $370 in the second quarter of 2011,up 8.5% from the average fare of $341 in the second quarter of 2010, according to the U.S. Department of Transportation. Second-quarter fares increased 3.9% from the first quarter, the second consecutive quarterly increase. And total prices may be even higher than government says. Fares in the study include only the price paid at the time of the ticket purchase and do not include other charges such as baggage fees, paid at the airport or on board the aircraft. (ConsumerAffairs.com)

— Honda's Acura brand isn't so ritzy after all. The carmaker had always hoped its Acura line could emulate Toyota and Nissan, which successfully propelled the Lexus and Infiniti brands, respectively, into the rarefied luxury-car tier alongside Mercedes-Benz, BMW and Cadillac. It never quite happened, and Honda now says it will try to reposition Acura as a mid-range, fuel-efficient brand. Over the next few years, Acura will introduce a new compact sedan, the ILX, built on Honda's global Civic platform, replacing the TSX. A redesigned RL flagship is expected by next fall, followed by a redesigned mid-sized TL sedan in the spring of 2013. (ConsumerAffairs.com)

— David Lazarus

Photo: Despite economic hard times, more people are expected to hit the road this holiday season. Credit: Michael Robinson Chavez / Los Angeles Times

 

Connect

Recommended on Facebook


Advertisement

In Case You Missed It...

Video




Categories


Archives