State of the Industry -- Airlines

For the past weeks I'm watching international news in cable channels like CNN, BBC and Channel News Asia, I can't help to notice that airline news is one of the hottest issues being reported whether in Asia, Europe or North America. A layoff here, additional fees for each checked bag there and tens of issues more which directly or indirectly affect the 2.3 billion riding public annually in a negative way. The numerous news today are a far cry on what is the industry like two years ago when almost all industry leaders are predicting a double digit growth in the fleet size and income of airlines as the demand for air travel will soar in the sky specially for emerging markets like China, India and the Middle East.

Never I heard a news report two years ago that airlines will cut their flight frequencies in a number of its destinations or they will cancel their orders of new aircraft to better service their loyal customers.

The evil power of speculation took its toll in the price of petroleum products specially for the jet fuel hungry jumbo airplanes. All modes of transportation that require petroleum were affected with special emphasis on airlines as their airplanes gobbled up gallons of jet fuel by the minute. Some airlines were forced to cut costs by laying-off hundreds of its employees like what the biggest carriers in the U.S. did. Another way to cut costs for the airlines is by opting to a more budget friendly alternatives in their direct and overhead expenses like outsourcing non-operational work like cleaning planes and passenger reservation services. For example, don't be surprised if you hold an American Airlines or Delta Airlines ticket and decides to call the airline's hotline number to request for a vegetarian meal and from the other side of the line an Asian-sounding accent agent answered your call. I have a friend who worked for a call center here in Manila which handled calls on behalf of American Airlines reservations department in the U.S.

If I may conclude, I think that the golden age of flying has ended many years ago. Many say that you don't get anymore a privilege feel when you fly these days unlike 10 to 20 years ago when all of the passengers get a pampering in the air and even before entering the departure gate. Even some legacy or full-service carriers are adopting the business models being used by low cost carriers as they start to charge for baggage fees, no more free food on short flights (if there is, you will be bombarded with empty calories from junk foods) and I even heard in the news that a U.S. airline will start to charge passengers who want to use pillows and blankets... on the bright side you can take home those as a souvenir. I just hope that the airlines will not have an idea to charge us passengers for using their seat belts.

For those who just want to get from point A to point B and are not particular about the special complimentary services legacy airlines offer, they have the budget airlines or low-cost carriers to thank for. An airline makes money when its airplanes are on the air so budget airlines reduced its aircraft turnaround time to increase its aircraft utilization. I am not a fan of budget airlines but as much as possible I try to fly with them to save a few hundreds of pesos. Some budget airlines even operate newer airplanes as compared to full-service airlines so safety and aircraft maintenance issues are not my concern.

Now that the price of petroleum products continue to stabilize in the world market, I hope that airlines will now avoid plunging into red this time because I love flying and I don't want them to loose their business as it is always good for the consumer for an industry to have many competitors.

Sikat sa Laos (famous in infamous)

Patuxay a.k.a. Gate of Triumph

The title is not an oxymoron at least for Filipino readers. It is roughly translated (Filipino to English) as "famous in infamous." This post is about the country Laos which is part of the Southeast Asia region. So... What's in Laos which made me and 3 of my friends go there?

It is a land-locked little country that relies on its unspoiled beauty and friendly people as its main draw. Life in that charming country is so simple and laid back as even the rush hour traffic which city dwellers like me would joke about is nothing for the Lao native. The country is bordered by Thailand to the west, Myanmar and China to the northwest, Vietnam to the east and Cambodia to the south.

For many Bangkok is a shopper's paradise but in Laos souvenirs, t-shirts and woodworks are cheaper than in Thailand as the currency of Laos (the kip) is so much devalued at about US$1-9,900 kip as of January 2007. Almost all shops accept the Thai baht as legal tender. Credit cards can be used in major hotels in Vientiane, but are of little use elsewhere.

General advice:

As like to every country in the world, travel common sense will guide you well in navigating Lao culture and way of life safely. When in Laos remember not to touch heads (it is considered the most sacred part of the human body), do not loose your cool with people and do not display your flesh. The rest is about manners, shoes left outside, accepting hosts' greetings and not upsetting religious feelings.

And by the way, it is good to bring sandals or slip ons to take off easily when entering temples as the city offers many temples worthy of a visit.

The Lao people are very friendly and hospitable and a minimum effort will make your trip smooth and memorable. Respect the culture and you will earn its respect in turn. Modest dress and discreet behavior will ensure you do not attract unwanted attention or embarrass others.

How to get to Vientiane, Laos from Manila:

- The most recommended by travel guides, economical and adventurous way to go to Vientiane (the capital of Laos) is through the Friendship Bridge which connects Laos and Thailand.

- We took a Cebu Pacific flight to Bangkok and connected via budget airline Nok Air to the city of Udon Thani, Thailand.

-From Udon Thani International Airport we took a van to the border town of Nong Khai, Thailand. From there, Vientiane is only a 30-minute bus ride.

-Direct flights from Bangkok to Vientiane's Wattay International Airport is also available.

Budget Airlines... A Fun & Cheeeeap Way to Travel

The budget airline industry (a.k.a. low cost carriers, no-frills airlines and discount airlines) here in the Philippines is still in its infancy stage with Cebu Pacific (CEB) (www.cebupaficair.com) setting the pace for all other airlines. The business model of most budget airlines including CEB is patterned after its U.S. counterparts like Southwest Airlines and JetBlue Airlines.

If your only concern is to get to point B from point A in a prompt manner in just a fraction of a cost compared with their full-service counterparts then budget airlines are for you.

Most budget airlines offer seat sales regularly. For CEB, bargain hunters should always log-on at its web site every Monday as it is the day seat sales usually starts. I once took advantage of the FREE seat sale of Air Asia (www.airasia.com) with flights leaving from Clark Field to Kuala Lumpur for only 3,300 pesos for a roundtrip ticket last year. Air Asia advertised it as a FREE seat sale so the 3,000 bucks I paid all went to the Malaysian and Philippine governments as taxes. One drawback of booking during a seat sale is that your travel date would have to be at least in a month's time.

They are called budget airlines because their operating cost structure is lower than their full-service competitors. In layman's term they are airlines with low ticket prices and limited services regardless of their operating costs. CEB and its counterparts enjoy a lower operating costs because of many factors which include a single passenger class, a single type of aircraft which may reduce its servicing costs, use of electronic ticket and the elimination of in-flight services like complimentary food and drinks. Most budget airlines offers a food and beverage option which passengers will have to pay.

One disadvantage of flying CEB on international flights like Kuala Lumpur, Singapore and Bangkok is that all of those flights are considered red-eye flights as you would leave late in the evening and arrive in your destination before sunrise. Budget airlines take advantage of red-eye flights as during these times landing fees and aircraft parking fees are lower. But the timings of CEB's flights to and from Hong Kong are great. One can leave Manila early morning to take advantage of the day activities and leave HK late at night.

For me, I don't mind traveling with budget airlines when I'm on a vacation because I value more the $avings that I get from them rather than having those bland and sometimes unpalatable airline food in a full-service airline. I can save more than 50% of the ticket price by taking a budget airline which can buy lots of souvenirs with the money I save... But when I'm on an official trip or someone would buy me a ticket, I don't mind traveling with a full-service airline. hehehe :)

happy travels to all!