fuel Archives - TravelSkills

Travelers getting gas over higher prices

March 8, 2017

Map shows where gas is currently cheapest (green), priciest (red). (Image: Gas Buddy)

This time last year we were paying less than $1.80 per gallon on average for gasoline. Now we are paying about $2.30.

Ouch! Have you noticed the 50 cent increase? The price of fuel not only affects travelers at the pump– it puts pressure on airlines to raise fares as the peak summer season approaches. It also makes ride-sharing drivers earn less.

The average price per gallon now $2.30, up from $1.80 last year. (Gas Buddy)

With travelers looking for relief, InterContinental Hotels Group’s customer loyalty program has started offering its members a new benefit: savings at the pump. It’s a program aimed squarely at biz travelers who drive more than they fly – which is the great majority of them.

The company said its new Fuel Rewards program link provides discounts on gas purchases at Shell stations nationwide, with the amount varying by elite status.

The savings include a 5 cents-a-gallon discount for Club and Gold Elite members of IHG Rewards Club (10 nights or 10,000 points a year); 6 cents for Platinum Elites (40 nights/40,000 points); and 7 cents for Spite Elites (75 nights/75,000 points).

How to get your discount at Shell

It’s a nice innovation for a hotel loyalty program as the price of gas keep creeping up, but 5 to 7 cents a gallon? That’s a savings of a buck or less for a fill-up. We’ve seen supermarket discount cards that offer savings of up to 30 cents a gallon.

But individuals could accumulate greater savings. IHG said the Fuel Rewards program is operated by a company called Excentus, which has similar arrangements with other national brands and retailers, and the benefits can be combined. “As members of the Fuel Rewards program, IHG Rewards Club members can stack additional fuel savings from purchases made at a variety of participating retailers, restaurants and merchants,” the company noted.

Members who want the perk must link their IHG Rewards Club account with Fuel Rewards. Here’s a link to Fuel Rewards, with details and more information.

IHG is not alone in offering fuel savings. Best Western Rewards members can redeem 13,000 points for at $50 Shell gift card that can be used at the pump or store.

How much is gasoline per gallon in your home town? Have you noticed how much it’s increased in recent months?

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United’s 4-hour flight to nowhere

February 9, 2017

United flight 1111 from San Francisco to Kauai on Tuesday, Feb 7 (Image: FlightAware)

United flight 1111 from San Francisco to Lihue, Kauai on Tuesday, Feb 7: a four hour loopdy loop (Image: FlightAware)

On Tuesday morning at 9 a.m., United flight 1111 took off from San Francisco International with a likely load of gleeful passengers bound for paradise.

Then something happened and the flight had to return to San Francisco…. after circling over the Pacific Ocean for four hours, arriving at about 1 pm.

I was not on this flight, but have been able to piece together what happened.

UA1111 departed on time at around 9 a.m. bound for Lihue, Kauai, but experienced a maintenance issue shortly after take off which required a return to SFO.

To make it to Kauai safely (2,540 miles away), a Boeing 757 is loaded down with a LOT of very heavy fuel. It’s so heavy in fact, that the plane cannot land with that much fuel onboard.

Don’t miss: First look inside United’s newest jet: The Boeing 777-300ER [PHOTOS]

United flight 1111 preparing for take off to Lihue- I took this flight last summer ! (Chris McGinnis)

In many cases like this, the pilots would quickly jettison the fuel at a high altitude. Once the fuel is offloaded, the plane could return and land. (Jettisoned fuel disperses into the atmosphere and does not come raining down to earth. See: Fuel Dumping)

However, a Boeing 757 is not able to dump fuel, according to my aviation geek buddies with whom I had a Twitter chat about this.

So… this meant that pilots had to fly the plane in circles for four hours off the coast to burn off fuel and lighten up before returning to SFO for a safe landing at 1 pm.

I can only imagine the groans from passengers when the pilot had to inform them that they’d be flying around for four hours, landing back in rainy SFO instead of sunny Kauai. In Kauai, there were undoubtedly people to meet, cars to rent, meetings to attend and hotel rooms reserved. These folks were ready to get their toes in the sand, no doubt!

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View of Hanalei Bay from a room at the St Regis Princeville in Kauai (Chris McGinnis)

I contacted United to find out how this all played out, and it sounds like the airline did a good job recovering from this mishap. A spokesperson told TravelSkills that when the plane landed back at SFO, United offered passengers drink and meal vouchers. Another plane was called into service to re-accommodate passengers, and took off at 4:30 pm and arrived in Lihue 6 hours later at about 9 p.m.

UPDATE: A lot of readers are wondering why United didn’t just fly the plane to Hawaii if they were going to circle for a few hours. The reason is that United did not want to fly a faulty aircraft thousands of miles out over the ocean. Instead, pilots circled within a few hundred miles of SFO so they could land if they had to. Here’s an image of how far the flight is to Hawaii… and how close the plane stayed to SFO.

Mid point to Hawaii is 1,250 miles from the nearest airport– no place to be flying a faulty plane! (Image: FlightAware)

Phew! Has this ever happened to you? What’s the worst or most painful delay or cancellation you’ve had to deal with? Please leave your comments below.

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Will passengers benefit as airline profits skyrocket?

May 3, 2016

Will airlines spend their soaring profits on passengers? (Image: Jim Glab)

Will airlines spend their soaring profits on improvements for passengers? (Image: Jim Glab)

Government statistics released this week show that the U.S. airline industry is achieving levels of profitability undreamed of in previous years. The question for consumers: How much of that money be spent on improving their air travel experience?

According to the Transportation Department’s Bureau of Transportation Statistics (BTS), the U.S. airline industry’s after-tax net profits hit $25.6 billion for 2015 – more than three times what they earned the previous year.

For decades, the airline industry has been characterized by historically low profit margins relative to other businesses; it usually stayed in the low single digits, and often it was a negative number. But for 2015, the industry’s net margin hit a record 15.2 percent, BTS said. That’s almost four times the 2014 margin (4.4 percent).

Source: Bureau of Transportation Statistics

Airline revenues from fares dropped a bit last year, but revenue from passengers hit new records for things that used to be included in the fare – fees from checked bags rose to more than $3.8 billion, and revenue from ticket changes/cancellations increased to just over $3 billion. The biggest bottom line benefit came in fuel costs: for the past several years, the industry had been spending between $42 and $44 billion a year for fuel, but in 2015 they spent less than $27 billion.

And how will passengers benefit from the airlines’ good fortune? It’s true that the major carriers have been renewing their fleets with next-generation aircraft, but those purchases are usually governed by bottom-line considerations – mostly that they are more fuel-efficient. But they often cram in more seats with less personal space in economy, and they are turning to new “slimline” designs – which many passengers dislike — to save weight and to free up space for another row or two of seating.

And what about ground facilities? Major improvements are coming to some big airports, but the American Association of Airport Executives this week blasted U.S. airlines for their ”staggering disconnect” in continuing to oppose an increase in the passenger facility charges that Congress allows airports to collect for infrastructure improvements, while at the same time hauling in record passenger fees for themselves.

Airports also get money from the Airport and Airway Trust Fund, which is funded by the 7.5 percent excise tax on air fares. But AAAE noted that since 2008, the airline tactic of separating out baggage fees from ticket prices has cost that fund almost $2 billion in lost revenue.

Readers: Are you seeing an improved passenger experience as airlines wallow in record profits? What would you most like to see them spend money on that might make your life easier?

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Airlines face new scrutiny over surcharges

February 25, 2016

Are airlines going too far in hiding unjustified surcharges? (Image: Jim Glab)

Are airlines going too far in hiding surcharges that have no relation to their costs? (Image: Jim Glab)

As oil prices continue to linger at or near their lowest point in years, airlines are facing new criticism of their ongoing fuel surcharges – or more often now, other vaguely-defined surcharges that replaced them – and interests representing travelers want the Transportation Department to intervene.

Senator Richard Blumenthal (D.-Conn.) this week released a letter he sent to Transportation Secretary Anthony Foxx asking for a DOT investigation of carrier-imposed surcharges that “mislead and possibly deceive consumers.”

DOT in 2012 banned airlines from imposing fuel surcharges unless they were directly linked to fuel costs. And after fuel prices went into their downward spiral in recent years, “most airlines dropped ‘fuel charges’ and began assessing consumers other vaguely-worded charges such as ‘international/domestic surcharges’ and ‘carrier-imposed charges,’ which seem to have no relation to any additional costs borne by the airlines,” Blumenthal wrote. In some instances, he said, the fees are larger than the actual base fare charged by the airline.

Blumenthal noted that the fees “sometimes only surface when a consumer attempts to redeem an award ticket,” a circumstance that “seems to further confirm the deceptive nature of these surcharges.” He cited fine print in Delta’s SkyMiles rules which includes hint that redeeming a “free” award ticket may cost the customer “’up to $600 for foreign government taxes and fees and/or carrier-imposed fees for international itineraries;’” and that Delta “’reserves the right to change fees or add additional fees at any time without advance notice.’”

Secretary Foxx got another letter this week from the Business Travel Coalition, requesting a “thorough and in-depth investigation” of airlines’ ongoing assessment “of often-sizeable fuel surcharges on many itineraries,” in violation of DOT rules about justifying such charges.

“We call on DOT to hold the airlines assessing fuel surcharges, by any term or language, to account — by requiring them to substantiate on a route-by-route basis that the charges do indeed reflect the actual costs of fuel per passenger over some baseline amount,” BTC wrote.

Readers: Have you had any unpleasant surprises with unexpected or extreme surcharges? Should the government intervene? Post comments below.

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More airline fee tricks

February 3, 2016

Are international “passenger surcharges” the new normal? (Image: Jim Glab)

Last week, we reported that with the price of oil hitting new lows, some international airlines — mainly foreign carriers across the Pacific — were finally reducing or eliminating fuel surcharges on passenger tickets. But that item also cited a BBC report that some big European carriers were now assessing unexplained fees called “carrier-imposed surcharges” or “international surcharges.”

According to a new Bloomberg News report, U.S. carriers are using the same trick on international flights.

The report notes that U.S. airlines were required by a 2012 Transportation Department rule to demonstrate that their fuel surcharges were in fact related to the cost of fuel. Since that got to be more and more difficult as the price dropped, they turned instead to “carrier-imposed fees” on international tickets that are defined vaguely — or not at all.

And those fees can be substantial. Bloomberg cited the following breakdown of costs and fees from an American Airlines flight from Los Angeles to London:

Source: Bloomberg News

Note that the “carrier imposed fee” is significantly more than the base fare. (The breakdown also serves as a reminder that the U.K. imposes some of the highest airline passenger taxes in the world.)

Bloomberg notes that airline ticketing software uses the code “YR” for such charges, a designation that can include fuel, insurance, or just about anything else the airline wants to cram in there.

In addition, when large companies negotiate special rates for volume purchases, the percentage-off discounts only apply to the “base fare” and not the surcharges.

Tricky indeed.

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Mounting evidence that fares really ARE cheaper

January 26, 2016

Declining fuel costs are finally affecting ticket prices. (Image: American Airlines)

Although it may not feel like it, there’s a growing body of evidence that international air travel is actually getting less expensive, and a lot of it has to do with the plummeting price of oil.

Last month, we reported on a study from Expedia that found average international ticket prices for economy class travel were down about 8 percent worldwide during 2015. And a new report in USA Today suggests that the price decline is more like 15 percent, based on U.S. Department of Labor statistics and other metrics.

For several years, the cost of international air travel has been kept high by the airlines’ imposition of fuel surcharges that at their peak could add tens or even hundreds of dollars to the price of a ticket. Any time airlines slap on a fuel surcharge, they tend to be reluctant to remove it, no matter what happens to the price of fuel.

But these days, with oil prices dropping like a rock, they are finally reducing or eliminating those surcharges — sometimes with government mandates.

Flights across the Pacific getting cheaper, faster (Image: Chris McGinnis)

The biggest fuel surcharges tended to be on the longest routes, like those across the Pacific. And that’s where some of the biggest reductions are happening.

For example:

Last month, Japan Airlines and All Nippon Airways eliminated their fuel surcharges on flights originating outside Japan, and they are considering a similar step for Japan-originating service as well.

The Civil Aviation Department in Hong Kong last week issued an order to airlines there that they must get rid of fuel surcharges effective February 1, according to Reuters.

Korea’s JoongAng Daily reports that fuel surcharges will be eliminated next month for both international and domestic travel on Korean Air and Asiana.

In Taiwan, the Civil Aeronautics Administration reported that fuel surcharges on long-haul flights, already low at $26, dropped to $19.50 this month, their lowest level in 11 years.

The downward trend in air travel costs might be even stronger except for rising demand. According to the International Air Travel Association, passenger demand on international routes was up 6.8 percent for the first 11 months of 2015 compared with the same period a year earlier, while capacity rose only 6.1 percent.

Still, some airlines are extremely reluctant to see that extra revenue disappearing. The BBC noted in a recent report that in lieu of fuel surcharges, British Airways has started to collect what it calls a “carrier-imposed surcharge,” and Lufthansa has something similar termed an “international surcharge,” both intended to cover a variety of vaguely-explained costs.

What does it feel like to YOU? Are flights getting cheaper or more expensive? Please leave your comments below.

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