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Posted by
Andrea Bennett on Monday, October 06, 2008 at 6:29 PM to
Airfare Tips
By Andrea Bennett
Part one of a two part article
They're elusive. The airlines don't like to talk about them (we asked). And determining their legitimacy from among the myriad websites that claim to specialize in them is a Herculean task. We're talking about consolidator fares, those secret airfares the airlines release in limited "buckets" to companies that re-sell them for big. Yes, they do still exist and you can get them, but as with any purchase (such as “grey market” electronics), you'll always trade something for the price break. There are reliable ways to get them, just as there are ways to get burned. And just because they're specially negotiated deals doesn't mean you might not be able to find a better published fare on your own.
The Backstory
To understand what consolidator fares mean today, you'll need a little history. Decades ago, it became clear to airlines that only selling highly visible, published airfares to travel agents and consumers made it easy for competing airlines to beat their fares and make off with their customers. To ensure they could fill up less popular flights, airlines began quietly selling discounted seats through consolidators. They reasoned that a little revenue per seat was better than none, and because the discounted prices weren’t published, other airlines wouldn’t be able to swoop in and drive down overall prices. You’d often find these fire sale fares in ethnic storefront travel agencies or even bodegas, which offered them only sporadically. According to Bob Harrell of New York airline consultancy Harrell Associates, the airlines employed plenty of tactics to get around pre-deregulation rules about tariffs, which required large numbers of seats sold this way to be part of a tourism promotion. “They’d print up five brochures, pass them around, and call it a tour,” he says.
Consolidators Today
Consolidators have come a long way since those early, often risky times. Airlines now see consolidators as a reliable distribution channel, negotiating annual contracts with them, establishing revenue targets, and tightly controlling ticket sales through a specific kind of booking class, or “bucket.” If you were wondering, consolidators and bucket shops are essentially the same thing, though the name, like the practice, has been refined over time. The fares are also known as “private” and “bulk” fares. But for the record, not every unpublished fare is a consolidator fare; military discounts, corporate discounts, and other specially negotiated fares – such as cruise and package fares – are also considered “unpublished” and are almost never consolidator fares.
We talked to Greg Rholl, Vice President of Pricing and Distribution for Minnesota consolidator Centrav, one of the largest consolidators, with contracts with more than 30 airlines, who ran us through the process: A consolidator will have a contract to sell private fares at a lower price than the published fare. If there’s a printed ticket, only “bulk” generally appears on the receipt. They generally can’t – or won’t - sell the ticket straight to you, but will offer it through a travel agent (including an online travel agent such as Travelocity or Expedia), or agencies such as the ones that advertise in Sunday newspaper travel sections. The agent adds their markup – keeping the margin slim so they’re not out-priced by published fares – and passes the remaining savings on to you. True consolidators don’t buy in quantity or ahead of time. Rather, they pull availability from their assigned class until the airline decides to close the window. It can be a great way to find a fluke fare, and consolidators now keep each other honest. Centrav, for instance, is a charter member of the United States Air Consolidators Association, which requires that its members sell at least $20 million in consolidator fares and have uninterrupted sales of at least two years. This may not mean much to you, since you can’t buy tickets from the USACA, but it should: If your trusted travel agent chooses a dicey consolidator that reneges on the deal or goes under, you’ll be relying on your credit card or your agent’s integrity to buffer you from the loss.
In the second half of this article, the best ways to shop for consolidator tickets
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Posted by
George Hobica on Saturday, October 04, 2008 at 11:05 AM to
Especially in these tough economic times, it's more important than ever to save money on airfare. That's where Airfarewatchdog's free airfare widget and RSS feeds come in. Over 40 US Airports now use them on their Web sites to show potential passengers that there are indeed low airfares if you know how to find them.
And now, we're noticing that hotels and resorts are adding the widget to their web site's home pages. Makes sense: show potential guests low airfares to your local airport(s) and you're more likely to fill up rooms. See how the Marco Island Marriott Resort and Spa is showing guests low fares into Ft. Myers, FL.
The latest airport to get on the widget bandwagon is Spokane International.
And if you're running a convention or other meeting, why not show attendees low fares into the convention city? That's what PMA is doing. The Photo Marketing Association is holding its 2009 convention in Las Vegas, so, wisely, they're displaying the widget on their web site. Frankly, we're at a loss to understand why everyone doesn't do this! OK, if you're not using our fares to display, then use one of those other fare listing sites. Oh, right, they don't have Southwest or Allegiant fares, so not such a good idea. But they're beter than nothing!
Learn more about the widget and RSS feeds and get your very own right here.
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Posted by
Jonathan Weinberg on Friday, October 03, 2008 at 6:38 AM to
Airline Industry News
Minneapolis based Sun Country Airlines, fighting to survive a cash crunch, has warned its employees to prepare for the possibility of major layoffs, or a shutdown of the airline, as early as Dec. 1.
SunCountry is struggling to survive until the heavy winter travel season when it expects to turn a profit, but in the meantime they are taking drastic actions, including a 50 percent pay deferral for employees to improve their cash position.
SunCountry was looking for a short-term loan from its owner, Tom Petters, to address the cash shortage issue but Petters, the airline's majority shareholder, resigned as CEO of Petters Group Worldwide Monday because he is the target of a major federal fraud investigation. While this is unrelated to SunCountry's business, it looks like Mr. Petters has his hands full with "other matters", so SunCountry will have to see financing elsewhere, which is none too easy in the credit crunch the country is experiencing currently.
Will SunCountry ultimately survive? It's still too early to tell, but clearly this is an ominous sign. One thing is for sure... They certainly won't be the last airline to run into trouble in this difficult economy.
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Posted by
George Hobica on Wednesday, October 01, 2008 at 9:24 PM to
Airline Industry News
When Delta merges operations with Northwest later this year, it's unlikely that the combined airline will operate six hubs, especially since some of them are relatively close to each other.
Which ones will go? Atlanta or Memphis? Detroit, Cincinnati or Minneapolis? Will they keep Salt Lake City? Whatever happens, Norwelta will cut some routes, and there will be room for other airlines to nose into these hubs, and Southwest, not surprisingly, is the first to make a move. Beginning in March, the Dallas-based low cost carrier will begin service between Chicago Midway and MSP, which will bring low cost connecting service to cities Southwest serves from Midway. Minneapolis desperately needs another low cost airline, especially if Sun Country, which is experiencing financial difficulties, doesn't survive.
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Posted by
Tracy Stewart on Wednesday, October 01, 2008 at 12:21 PM to
Airfare Tips
Ok, so as we've established, carting the kids along on your travels can be a little bit of a headache. At least the getting-there part of the trip. There's the unavoidable sippy cup mishaps, the disapproving glares from other passengers, and -for the solo travelers - the seat kicking, and (everyone's fave) the crying. So, how can parents and passengers survive the upcoming holiday travel blitz, minus the headaches? Minus the crying? How do you keep your little angels in check on those long dull flights? What's your smooth operator approach to handling junior seat kickers? Share your parenting travel tips, tales, and advice with us below! And maybe your wise words will be of use to other folks flying with/alongside the kiddies this season.
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Posted by
Bo Borre on Wednesday, October 01, 2008 at 6:43 AM to
Europe/Africa/Middle East Airfares
10/7 Update: The discount coupon code has changed to ENEWS10387.
More than JetBlue can play at this ten percent promo game and now Air France has timed their own offer to take advantage of the whole Alitalia debacle. By using the ENEWS10373 coupon code when booking on the airline web site, you can shave 10% off the current October Italy Specials.
While the coupon is valid through October 21, the sale ends on October 2, so this is no time to dither, but please read the note and tiny print below before you run off. Also be sure to compare prices elsewhere before you commit to anything, because even with the discount applied these may not be the best deals available.
As we mentioned numerous times over the summer on this blog, fares to Italy have been unusually competitive this year with Alitalia cutting back and competitors like Air One, American, Eurofly, and Iberia only too happy to pick up the slack. Even as Air One shuts down their nonstop Boston-Milan route next week after less than 6 months, they continue to offer good deals through their Chicago gateway or in cooperation with United through Washington.
Coupon is valid for Air France marketed and operated flights, valid for new purchases and will not apply to existing bookings. Coupon is redeemable for tickets issued on www.airfrance.us. Coupon is valid for flights departing from the USA and arriving in Italy. Coupon is valid for departures October 1 through November 30 and with return dates October 2 through December 30, 2008. Coupon applies to reservations in Tempo (Economy Class) and is limited to one usage per customer; stock is limited.
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Posted by
George Hobica on Tuesday, September 30, 2008 at 5:58 PM to
Airline Industry News
As most industries mature, and certainly the airline industry has been around a long time, consolidation ensues. But that's not the case with airlines. Instead, each year the industry becomes more fragmented. Anyone with a few million and the necessary paperwork can start an airline. And so they do.
Imagine if there were 30 steel companies in the US.
What is it about consolidation that airlines hate so much? Why do entrepreneurs launch new airlines when most start ups are doomed to fail and the industry is not profitable?
Almost any economist will tell you that the world has too many airlines chasing (especially now) too little traffic. Every little podunk country has its own flag carrier, even if it makes no economic sense. Every year it seems, there's a new SkyBus or Independence Air, Zoom, EOS, MaxJet, or Express Jet, and every year, there's one (or more) fewer, lost not to consolidation but to liquidation.
You'd think, with the cost of jet fuel and fewer passengers, that airlines all over the world would be jumping at the chance to combine. Of course, some are: Delta and Northwest should be united by the end of the year, and overseas, we've seen British Airways, Lufthansa, and Air France buy other large and small carriers.
Truth is, consolidation isn't as easy as it might appear. First, there are government regulations. In order for two US legacy airlines to combine, the US government is going to first make sure that the new carrier doesn't have an overwhelming market share. So American cannot combine with, say, United because the combined entity would have over 30 percent of US market share and that would be very anti-competitive. As a result, some experts say, it's possible that we might see a smaller legacy carrier, such as US Air, intentionally shrink in size in order to combine with a larger airline. But shrinking, and remaining in business, is a tricky business.
Plus, the US has laws preventing a foreign carrier, such as British Airways, from owning more than 25% of a US carrier.
Then there are labor issues, mainly pilot seniority. Pilots are loathe to give up the pay and perks associated with seniority and if one airline merges with another, a captain at one airline might become a first officer at the combined carrier. Pilots hate that sort of thing.
And then there's the mystique issue. "Airlines are such a sexy business investors can't resist it," writes Victor J. Cook of Tulane's A.B. Freeman School of Business in a June 2008 paper. Every country wants its own. Guys just like to run airlines. Even Donald Trump got in the game when Eastern went belly up back in the late eighties.
And now that oil prices have come down, there's less urge to merge.
Even so, during a panel discussion at the recent ACI-NA (Airports Council International North America) annual convention in Boston, most experts opined that further consolidation is both inevitable and desirable, and rules prohibiting foreign ownership of US airlines should be revisited.
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Posted by
George Hobica on Monday, September 29, 2008 at 1:51 PM to
No, your eyes aren't playing tricks on you.
Travelocity is fooling around (some would say screwing around) with their airfare search user interface for flexible date searches. It's currently in beta. On the plus side, it shows fares with all taxes. But now you must choose the length of your trip to see fare results. And it only shows one month at a time.
Some people will love this new feature, others (those of us who just want to see the very lowest fare between two cities, assuming we're totally flexible in our dates, over a 330 day period) will hate it.
Travelocity seems to have anticipated the antipathy of the latter group (us) so there's a link at the bottom right of the calendar that you can click if you don't like this new feature. Also, if you click the "next" arrow box (in brown) at the top right, you'll eventually get to a full 330 day fare result.
This beta version only pops up in some city pair searches for now, but we suspect they'll be rolling it out site-wide eventually.
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Posted by
Bo Borre on Tuesday, September 23, 2008 at 8:02 AM to
Europe/Africa/Middle East Airfares
9/26 Update: Although the sale mentioned in this article was extended beyond its original deadline, it has now ended and been replaced by another great sale. Follow the links below to see what's currently on offer, but don't limit yourself to Ryanair. They may be the biggest budget player in Europe, but they're obviously not the only game in town.
Until we launch our British sister site soon, which will update you on great fares for travel within Europe the same way we now keep you posted on unbeatable domestic and international deals, we will occasionally let you know about European offers that are too good to pass up.
Like this latest "almost too good to be true" offer from Ryanair, which has put 2 million seats on "sale" for the next 2 days, available for fall travel to select European destinations. We haven't checked them all, but can at least assure you that in full if reluctant and belated compliance with new European Union "truth even in airfare advertising" rules, these deals really are as good as they sound and entirely free of any nasty tax bite or bitter aftertaste.
Moreover, to many destinations not included in this freebie sale, all-inclusive one-way fares start at just €15 from Germany, €23 from Ireland and £22 from Great Britain, making this a truly great tax-free deal in any currency, even at these paltry exchange rates.
The prevailing criticism of Ryanair is the old familiar saw that you only get what you pay for, as if there's actually anything wrong with that, but in this case you really are getting something for nothing and who can find fault with that? How exactly Ryanair makes any money in this business doing business like this has mystified Europeans for as long as they've been flying, but they still somehow manage to turn a profit every year, although the airline recently warned that this could be a rare break-even year.
No matter, their loss is your gain and here's a great chance for you to practice what we preach, which is to grab the best fare you can find across the Atlantic and then combine it with an amazing deal like this. The savings can sometimes be sizable, especially if you're going to more out-of-the-way places, which is usually where Ryanair goes anyway, since they prefer to use smaller and cheaper secondary airports.
It is for this reason that Dublin remains our favorite gateway to Europe. Not only is it often the cheapest European destination, but the compact terminal is a convenient one-stop transfer shop and, this being Ryanair's home base, one of the few major airports the airline flies to. Trying to arrange your connection through other cities will often require a trek between different airports and that can be a considerable hassle unless you happen to have reason to visit that particular city.
Keep in mind that Ryanair invented the notorious checked-bag fee and this is one extra they'll surely be happy to charge you. Also beware that even though you are protected by the European Union Air Passenger Rights on all flights departing Europe, which makes a carrier liable for damages even if they cause you to miss your return flight back across the Atlantic, Ryanair is not known to be all that accommodating in this respect, so be sure to leave yourself plenty of time to make your connection wherever you decide to do it.
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Posted by
Bo Borre on Sunday, September 21, 2008 at 12:03 PM to
Airline Industry News
As Europe's two weakest national airlines topple, a cluster of only slightly stronger second-string players totter toward an uncertain future.
The shakedown of Europe's ailing legacy airline industry that has been anxiously anticipated since the European Union deregulated air transportation over 10 years ago has finally reached full force. Stoked by surging—albeit now falling—fuel prices and further fueled by the fallout from global financial turmoil, stock market meltdowns and general political pandemonium, a perfectly awful storm has formed in the skies over Western Europe. The chaotic situation changes almost hourly, but the overall consensus seems to be that once this all blows over only a handful of survivors will be left standing without crutches, as the number of national airlines gets whittled down from a dirty dozen or so to the all-too-familiar Big Three multinational groupings.
Most dramatically, the long-running soap opera of Alitalia's drawn-out downfall seems to have sputtered to a dead end as last-ditch rescue efforts faltered on Friday. This appears to seal the Italian flag-carrier's fate by leaving it no other options but to pack up and fly blind from bankruptcy straight into insolvency. Of course, nothing in Italy is truly over until the famous fat lady sings, and while the Pope prays in earnest but to no apparent avail for the Vatican's official airline which might actually be cursed, as its former chaimain seems to think, Prime Minister Berlusconi may yet engineer an eleventh-hour miracle in the shape of yet another batty bailout. At this point, however, the company is so deeply mired in debt and controversy that not even divine intervention will likely save it from certain death.
Around the same time, a stage across the Adriatic went dark as the final curtain fell on a Greek melodrama starring stodgy state-owned Olympic Airlines. Unlike the tangled webs and tortuous plots of Rome, full of conspiracies, betrayals and a few assassination attempts, this is more a tame tale of benign euthanasia in Athens. An agreement has been put in place to put the airline out of its misery and put a stop to years of wrangling and illegal subsidies. Nevertheless, even after numerous privatization failures, a fairly Olympian optimism still prevails that in the spirit of classical tragicomedy has the airline staging a comeback some time next year after a much-needed makeover, armed with a better script, a respectable repayment plan and a preposterous new name—Pantheon Airways. Airline to the Gods? Yes, the Gods must surely be laughing right now!
Entirely unrelated to the unrelenting gush of orders, threats and fines pouring forth from the hard-nosed, stony-hearted bureaucrats of the European Commission in Brussels, the hometown flyboys at Brussels Airlines have thrown themselves into what may best be described as an arms-length embrace of two reluctant partners as they rushed to sell a sizable stake to Lufthansa. Not the whole caboodle, mind you, not even half, but just 45% for now, as proof of prudent German salesmanship—or brinksmanship—in these tumultuous times.
Brussels Airlines is itself the child of previous failures and mergers, the drastically downsized reincarnation of deregulation's first victim, Belgian's venerable but troubled Sabena, that somehow ended up with Sir Richard Branson of Virgin fame as its new stepfather, thanks to a messy but presumably immaculate conception. Earlier in the decade Swissair made an ill-advised attempt to rescue Sabena from the abyss but was instead dragged down with it and has since been taken over by none other than Lufthansa, somehow bringing everything full circle. Just as Swiss International, or simply Swiss, as it is now called, continues to operate independently under the new ownership, Brussels Airlines is expected to do much the same, proving that even when Lufthansa makes a whole-hearted commitment it's still a rather hands-off arrangement.
Meanwhile, down Vienna way the pending sale of Austrian Airlines is proceeding in a more orderly fashion as befits such solid and stolid Central European merchant traditions. Merely because it's looking to make a good deal and a handsome profit doesn't mean that it's necessarily going to sell itself to the highest bidder. Currently topping the short list of suitors, Russia's S7 Airlines, formerly known as Siberia Airlines and known to few people outside Novosibirsk by any name, have emerged as the dark horse of the dating circuit. It's no secret, though, that Lufthansa is viewed as just the right white knight in shining livery that everyone hopes will ride in at the last moment with a wandering eye and a fat wallet to deliver the Austrians from tough love in a much colder climate.
Circling high above this mating dance like a voracious vulture, Air France seems to have successfully digested KLM Royal Dutch after swallowing it wholesale a couple of years ago and could be getting hungry for another winged tidbit. It actually tried to chow down Alitalia before it realized the old crow was mostly skin and bones and too many feathers, so it will take a lot of little sparrows to fatten up this lovebird for the future. Merging with merging Delta-Northwest to make a really big Franco-American omelette is reportedly Air France's favorite pie—or quiche—in the sky, but so far Congress is not about to crack the ostrich egg and make that wet-lease dream come true.
Far up north, another hastily arranged winter wedding is in the works as Scandinavian Airlines, the struggling semi-privatized, semi-comatose carrier of Denmark, Norway, and Sweden, and the fourth-largest airline group in Europe that includes ill-fated Spanair among others, tries to cozy up to Lufthansa, these days everyone's Casanova of choice who may itself be getting a bit bogged down in the role of Big Daddy to its booming brood of aviation and travel-related companies, already the size of a small army.
Containing all the makings of modern-day Nordic mythology, this is a complex family drama worthy of the ancient sagas with the three fretful governments, like way too many overprotective parents, weighing the pros and cons of a shotgun marriage for an old maid trying her very best to look like a blushing bride. While management is at great pains to find an even modestly suitable match, other shareholders, including the illustrious Wallenberg dynasty, squabble like jealous in-laws over the dowry, leaving the militant trade unions to stand firmly on the sidelines like a bunch of bitter bridesmaids in tattered dresses just itching to crash the party and ruin the honeymoon. An uninvited guest, much smaller Finnair, has made a cheeky, unwelcome offer to buy the few remaining long-haul routes of the airline that pioneered them, a move that would be akin to stealing the wedding cake before the ceremony and slipping out the backdoor of the church.
Finally, back down where the sun really does shine in happy-go-lucky Spain, Iberia is getting close to tying the knot with British Airways. The idea is to then make another trip to the alter and set up a comfy if controversial ménage-à-trois with American Airlines, pending an application for a marriage license in triplicate and antitrust immunity for a joint-venture operation similar to what rival alliances, Star and SkyTeam, have been quietly granted and merrily doing for years.
In fact, those long-betrothed behemoths have been scrambling to shack up to for so long that the wedding bells are turning more than a little blue and American has impatiently started a good old all-American letter-writing campaign to members of Congress on your behalf, urging them to approve its plans for One World peace and, if at all possible, domination. Noble Sir Richard Branson, Our Virgin Savior always happy to act in your best interest, is once again up in arms and ready to foil the flirtatious plot. With a slush fund of sorts flush from recent dealings, he is dead set against this particularly devious deal and, much like Dustin Hoffman in The Graduate, determined to stop the union at all costs.
What all this means for travelers is impossible to predict. Alitalia ticketholders should definitely monitor the situation closely and contact the airline for information. Passengers of Olympic Airlines may be a bit more fortunate if the airline continues to operate during reorganization. As for the other candidates mentioned, they will mostly likely muddle through for the foreseeable future, flying their own flags regardless of corporate ownership, but many other carriers are still deemed to be at risk.
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