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Middle-aged airplanes like Boeing 757s and 767s are getting interior makeovers at American, Delta and US Airways with enhancement like new seats, overhead bins, carpeting, video monitors and entertainment systems. Some airlines, including Delta and US Airways, are planning to add tastier and heartier food to sell on flights. Carriers are sprucing up some airport terminals, including Sea-Tac Airport. And airlines are testing new technology that could shorten lines.
Alaska Airlines, for instance, has already begun an $18.5 million upgrade of its check-in counters at Sea-Tac. The renovation is what the airline calls its “Airport of the Future” design. The remodeling will eliminate the traditional check-in counter on the wall opposite the airport drive and replace it with a group of check-in ‘islands’ where passengers can obtain their boarding passes electronically at self-service kiosks. They will also be able to place their luggage on belts that will carry it into the bowels of the airport of screening and sorting.
The new Sea-Tac configuration is similar to one the airline built at Anchorage International Airport three years ago. That configuration moves passengers through the check-in procedure at twice normal rates, the SeaTac-based airline said.
Continental Airlines Inc. says it will begin installing new kiosks at its Newark, N.J., hub later this month that will let customers rebook themselves after they miss connections or have flights canceled by storms. For travelers, that would be a huge improvement over waiting in an airport line or a telephone queue.
Delta Air Lines Inc., just coming out of bankruptcy, has been spending $25 million a year to “deep clean” airplanes once a month, and by December should be finished installing “Live TV” entertainment systems on planes that fly long domestic trips. The new systems include on-demand movies, live TV, music and games.
The five biggest airlines do have some money to spend, having added $2.6 billion in unrestricted cash to their balance sheets over the past 12 months, a 19 percent increase. AMR Corp.’s American Airlines upped its cash position by $1 billion to more than $5.4 billion and even paid down $2.2 billion in debt at the same time. American’s total debt is still huge, however – $17.5 billion.
Though carriers have turned profitable, they still worry about high oil prices, softening domestic demand and having enough money to make it through the next downturn or crisis. Some have been reluctant to make major investments in planes and people, knowing the economy can turn on them again. Paying down debt is a major issue for the industry.
Still, having postponed improvements and seen airports and airplanes age during the prolonged downturn, airlines are starting to spiff up their products.
Travelers also say in-flight enhancements are long overdue, especially when discount competitors are offering nicer products. Entertainment systems such as satellite television and higher-quality food for sale would be welcome, especially on long flights.
A few carriers are also beefing up staffing, putting more resources toward training and launching programs aimed at boosting employee morale. US Airways Group Inc. says it is rushing to hire 1,400 additional airport workers by summer and Continental plans more “soft-skills training” for airport customer service staff. Delta is giving bonuses to employees, instituting profit-sharing and paying 4 percent raises for most workers as it comes out of bankruptcy.
“Having better morale among employees really helps the operation,” says Jim Whitehurst, Delta’s chief operating officer. One example he cited: Delta put flight attendants in new uniforms last year hoping to improve morale. Indeed, the company found that after donning the new uniforms flight attendants treated customers better. Customer complaints about in-flight service dropped by half.
Andrew Watterson, a director at Mercer Management Consulting, says he’s advising clients to invest in improvements that will boost productivity and help companies through the next downturn. Airlines need to move people faster and easier through airports by making kiosks handle more travel functions and speeding up ticket lines, baggage lines and security lines, for example.
“A New York subway station is a lot more productive than an airport,” he said.
