"Program shows airlines' ups and downs"

Tuesday, October 17, 2006

Program shows airlines' ups and downs
Travel editor Peter Greenberg pulls back the curtain on the complex world
behind the airline ticket counter.
By Chris Welsch
The Minneapolis (MN) Star Tribune


"Today" show travel editor Peter Greenberg has reported the decline of
America's airlines for years. He's also watched passenger frustration with
increasingly byzantine ticket pricing, unusable frequent-flier miles and
growing discomfort of air travel.

"How did we go from flying being an experience we enjoy to a commodity we
endure?" he said. He hopes to provide some answers during a two-hour
documentary starting at 7 p.m. today on CNBC.

"Inside American Airlines: A Week in the Life" examines the one major
airline that hasn't declared bankruptcy. It's a way to illustrate the
challenges all airlines face. "The public needs to see the process in order
to understand the product," Greenberg said by telephone last week.

Q What is American doing right that the others aren't?

A It's a sad state of affairs when you have to judge a business by which one
can lose money longer, and that's the state our airlines are in today. Even
American came within minutes of declaring bankruptcy. But the company turned
a profit last quarter, and it looks good for this quarter, too. American
management has had to work hard to get labor to buy into the idea that they
need to work together to survive. ... The jury's still out on whether
management can regain [workers'] trust in the long term. Labor has given and
given and given. Now that profits are coming in, they want a piece of the
pie.

Q In the year of research, what did you learn that was new?

A One thing that surprised me was how thin the profit margins really are. We
take a close look at one flight on one of American's premier routes: the
transcontinental flight between New York and Los Angeles. The flight was
fully booked, but the total profit was in the low three digits. ... One less
passenger, [and] they would have lost money on the flight. That's why, since
deregulation, more than 150 airlines have ceased to exist.

Q What did you find out about security procedures? Did anything scare you?

A We take a look at the cargo-handling center in Miami, where they handle
more than a million pounds of cargo each day. It's surprising what they're
inspecting and not inspecting. That not only concerned me, but it concerns a
lot of American pilots, and they are very vocal about it.

Q It seems like the hassles of flying have been compounding. Are we reaching
a point where people will decide it's just not worth it?

A We are a nation of addicted travelers. We may find new ways to take a
trip, but we are going to take it.

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