Fuel costs hurt air travelers Changing the face of business travel Road warrior travel tips

NEW YORK (CNNMoney.com) — The dysfunctional air travel system is causing many Americans to avoid air travel and the economy is suffering as a result, according to a survey released Friday.

The survey, conducted by the Travel Industry Association (TIA), a non-profit trade organization, found that frustrated travelers avoided roughly 41 million trips over the last 12 months, which cost the economy more than $26 billion.

“Many travelers believe their time is not respected and it is leading them to avoid a significant number of trips,” said Allan Rivlin, a partner at Peter D. Hart Research Associates, which interviewed 1,003 air travelers for the survey.

The avoided trips are having an impact on the broader economy. Over the last 12 months, there was $9.4 billion in revenue lost by airlines, $5.6 billion lost by hotels, $3.1 billion lost by restaurants and $4.2 billion lost in federal, state and local taxes, according to TIA.

“The air travel crisis has hit a tipping point, ” said Roger Dow, president and CEO of TIA. “More than 100,000 travelers each day are voting with their wallets by choosing to avoid trips.”

A majority of travelers said air travel safety and security has improved. But inefficient security screening, flight cancellations and delays were the top frustration among air travelers surveyed.

Overall, more than 60% of respondents think the air travel system is deteriorating. But travelers are most irritated with the air travel process, not the airlines.

TIA says the federal government can address some of travelers’ top frustrations, including delays, cancellations and inefficient security screening.

“With rising fuel prices already weighing heavily on American pocketbooks, we need to find ways to encourage Americans to continue their business and leisure travel.” Dow said.

To that end, TIA announced plans to hold an “emergency summit” of travel leaders in Washington on June 17, and called on each of the presidential candidates to address the issue.

The debate over how to improve the system, which has traditionally been dominated by the government and the aviation industry, is “stale and stagnant,” said Geoff Freeman, a TIA senior vice president.

Freeman said the the air travel system has problems “that the government and aviation industry cannot fix, ” and that the industry is suffering from a “failure of leadership.”

In a statement responding to the survey, D.J. Gribbin, general counsel of the U.S. Department of Transportation, said the Bush administration has undertaken a number of steps to help ease air service problems, including congestion-relief initiatives in the New York area and increased compensation for passengers who get bumped from flights.

“The Transportation Industry Association survey helps quantify the frustrations facing today’s air travelers, who bear a high cost in terms of delays and congestion,” Gribbin said. 

The climate clamor over flying doesn’t stop with environmental activists. One British bishop denounced flying on a vacation as a “sin.” Even publishers of travel books lament the climate impact of their wanderlust guides and are advising travelers to “fly less and stay longer.” Mark Ellingham, founder of Rough Guides, and Tony Wheeler, founder of Lonely Planet, have decried the growth of what they call “binge flying,” and urged air travelers to take to the skies less often. “In Europe, and especially Britain, we have become addicted to cheap flights, heading off to Rome for the day or Prague for the weekend,” writes Ellingham in e-mail. “Many people buy these as casually as booking a restaurant. I consider this ‘binge flying’ and I don’t think it’s sustainable behavior.”

How worried should air travelers be about contributing to global warming? Flying still makes up a very small percentage of greenhouse gas emissions. Globally, just 1.5 percent of greenhouse gas emissions caused by human activity each year come from air travel, according to Tim Herzog, a climate policy analyst for the World Resources Institute. In the U.S., that number’s about 3.5 percent. Yet those numbers are projected to rise sharply, making air travel one of the fastest growing contributors to global warming, while the world is struggling to reduce emissions. Over the next 20 years, more than 27,000 new aircraft will take flight, and the number of air travelers will double to 9 billion during the same period, according to the Hodgkinson Group, an aviation consulting firm. Here in the United States in the next two decades, demand for air travel will grow 150 percent, according to the Department of Energy.

Some governments are stepping in to curb the rising tide of emissions. By 2011, airplanes traveling within the European Union will be subject to a carbon trading scheme. But debate about such regulations inspired the unrepentant boss of one low-cost airline, Ryanair, to pledge to increase his company’s carbon emissions, saying if his customers are worried about the environment, he had some advice for them: “Sell your car and walk.”

Hopping a commercial flight sure feels like an airborne form of carpooling, especially when the blowhard sitting next to you won’t close his yapping trap for six hours. And, sure, fine, it’s unquestionably better for the environment than owning a private jet, which one horrified activist compared to buying a whole coal-fired power plant to power a single mobile phone. Yet even on today’s full flights with passengers crammed into small seats, flying packs a big climate punch. For a long trip, like a transatlantic flight on an average-size plane, each passenger is responsible for sending .39 pounds of CO2 per mile into the atmosphere, according to the World Resources Institute’s Greenhouse Gas Protocol Initiative. By that measure, flying direct from Denver to London and back puts about 3,600 pounds of CO2 into the atmosphere, equivalent to driving a Toyota Prius hybrid 10,000 miles.

While most Americans still emit more by driving than flying, simply because they spend so many hours in the car, frequent fliers can spew a lot more emissions than daily commuters. Take the doting grandmother, recently profiled in the New York Times, who flies 500 miles a week, jetting from her home in Houston to Dallas and back to care for her grandkids, a tale the paper dubbed “The Incredible Flying Granny Nanny.” A year of this high-flying childcare arrangement will pump almost 16,500 pounds of C02 into the atmosphere, more than the average driver of a four-wheel-drive Ford Ranger emits in a year.

It may be a short flight from Houston to Dallas, but shorter flights have a larger impact per mile than longer ones, since the takeoff and landing are the most fuel-hungry part of the journey. “These regional flights are not efficient because they don’t have time to get up into the atmosphere and cruise, where jets are most efficient,” says Luke Tonachel, a vehicles and fuels analyst for the Natural Resources Defense Council. That means the Incredible Flying Granny emits .63 pounds per mile every time she jumps on a jet to see the grandkids. She could reduce her emissions by hopping behind the wheel of a Honda Civic by herself and driving from Houston to Dallas and back.

But why pick on one grandma, when business travel accounts for 65 percent of all flights in the United States, according to PhoCusWright, a travel research firm. It’s the management consultants jetting from New York to Kansas City, and the tech executives winging it from Silicon Valley to the Bangalore outpost, who are really racking up those airborne emissions. Just ask Tom Arnold, chief environmental officer for TerraPass, a Silicon Valley company that sells carbon offsets: “The overwhelming majority of my personal carbon footprint is flights,” he says. Arnold says he cuts down by consolidating trips, and staying four or five days when he goes on a cross-country trip to New York, instead of just flying in for a meeting or two.

Flying also has another warming effect, beyond the greenhouse gas emissions. Planes leave behind contrails, thin wisps of condensation in their wake, which act like high, thin ice clouds producing an effect called “radiative forcing.” The contrails trap heat that’s radiating off the earth’s surface, contributing to global warming. During the day, they also reflect sunlight, which has a counterbalancing cooling effect. At night, and during the winter, when its darker, there’s less sunlight for the clouds to block. “The warming effect goes on 24 hours,” says Don Wuebbles, a professor of atmospheric science and director of the School of Earth, Society and Environment at the University of Illinois. “It’s generally thought that the warming effect wins out. The cooling effect is only during the day.” Right after 9/11, when most planes were grounded in the United States for days, scientists were able to measure a change in the temperature.

A purist might argue that if you’re really worried about global warming, any recreational flying is unsustainable. As with so much else with global warming, the emissions math is not that straightforward. Deforestation is a major contributor to global warming — second only to power generation as a source around the world — accounting for some 18 percent of annual human-induced greenhouse gas emissions. Tourism is one of the key industries that makes it economically viable for poorer countries to avoid clear-cutting rain forests for cattle ranching or agriculture. If visitors from richer countries suddenly stopped flying, more rain forests would fall, creating more emissions.

“I don’t think it would be a great thing for the world — and the developing world especially — if we all stopped flying entirely,” writes Ellingham from Rough Guides. “What is crucial, however, is that aviation doesn’t continue to grow at present rates — 10 percent in the U.K. and more than 5 percent globally. We don’t have a God-given right to cheap flights that overrides our responsibility to the planet and its people, most of whom, of course, never get on an aeroplane.”

It may come as a surprise to learn the airline industry itself is talking green. In June, Giovanni Bisignani, director general and CEO of the International Air Transport Association, threw down the gauntlet to his colleagues in the airline industry at their annual meeting. “Air transport must become an industry that does not pollute. Zero emissions,” he said. How to get there? “I don’t have all the answers, but our industry started with a vision that we could fly. The Wright brothers turned that dream into reality and look at where we are now.b

The association issued a challenge to its members to replace 10 percent of their polluting fossil fuel with low-carbon alternatives within the decade, and called on the airline manufacturers to build a zero-emissions aircraft within the next 50 years. The U.S. Air Force has set an even more ambitious goal, challenging fuel refiners and alternative energy companies to move the Air Force’s entire fleet to fuel that’s only 50 percent petroleum-based within the next decade. In the meantime, there’s an air travel industry-based Web site to soothe public fears about climate change and flying.

Richard Branson, maverick founder of Virgin Atlantic, has pledged $3 billion to search for alternative fuels. Biofuels don’t pack as much energy per unit as fossil fuels, which makes it challenging to use them aloft. There’s also some concern about them freezing or gumming up at high altitudes. Nevertheless, Virgin claims that it will be ready to test an alternative fuel on a commercial jet in 2008. In the meantime, the race is on to be more efficient with conventional fuels. Boeing boasts that its forthcoming 787 Dreamliner will use 20 percent less fuel than similar-size planes flying today. And one low-cost carrier, EasyJet, has a prototype for a short-haul jet that will reduce CO2 emissions by half.

To conserve fuel, Virgin Airways has experimented with towing airplanes to the runway to avoid turning their engines on until the last possible second. In fact, many planes now taxi with just one engine on, instead of using both, according to Steve Lott, a spokesman for the International Air Transport Association. Better air traffic management to ensure that planes take the shortest routes to their destinations and spend less time circling above airports waiting to land could also yield significant efficiency savings, according to Lott.

Yet these glimmers of conservation don’t appease Joel Makower, executive editor of Greenbiz.com, an environmental consultant to Fortune 500 companies. He recently mused on his blog about whether air travel will ever be green. “I don’t see anything that’s being done by the industry that suggests that airplane travel is going to be climate-friendly within my lifetime,” says Makower, who flew 51 times in the first half of 2007. He argues that the projected growth of the industry and current state of technology mean that airline emissions simply will get worse before they get better.

Still, without an obvious technology fix for air travel, inspiring passengers to give up flying is like trying to toss a paper airplane through a hurricane. Sure, a business traveler can replace a shuttle flight from New York to Boston with a more efficient train ride, but most trips, at least in the U.S., don’t offer such an obvious, efficient and convenient alternative to flying. “If you’re traveling on business between Atlanta and Chicago, what else are you going to do?” asks Herzog from the World Resources Institute. Makower says he hasn’t seen companies voluntarily replacing far-flung meetings with videoconferencing to curtail flying. “Some companies recognize that air travel is the biggest part of their carbon footprint, and the typical response is to offset it, not to reduce it,” he says. Even Ellingham from Rough Guides admits that asking people to cut back on flying won’t achieve much. “I think that a lot of people are moderating their flying habits, and many more will do so as the facts and urgency of acting on climate change become clear. But, no, I don’t think that it will be enough unless governments intervene.” Currently, the European Union’s plans to implement a carbon emissions trading scheme for airlines in 2011 is the only such action.

If you’re trying to figure out the impact of your own flight, you can use many online calculators, mostly presented by companies selling carbon offsets. Be forewarned that the results represent rough approximations. Also, each calculator makes somewhat different assumptions about how big the average plane is, how efficient it is and how full of passengers it is, and so your results will vary. Most online calculators don’t attempt to include the added impact of contrails.

The best way to reduce air travel emissions is, of course, not to fly. If a train is available and efficient, it’s always a better option, according to Jennifer Hattam, green lifestyles expert for the Sierra Club. She also recommends limiting shorter vacations to spots close to home, while saving flying for longer journeys. Another tip: Horde all your vacation days to take one long holiday instead of several shorter vacations throughout the year, involving flying.

Although you won’t catch anyone at the Sierra Club telling you to jump in a car, driving can produce fewer emissions per passenger mile than flying, especially if you have a fuel-efficient car. Trying to decide if you should drive or fly from, say, San Francisco to Los Angeles, adding people to your car who would have flown can easily tip the scales in favor of driving. Flying in the summer, when there’s more light, is also better for the atmosphere than flying in the winter, when it’s darker. And now that you know it’s better to fly in the day, you have a perfect excuse, should your eco-savvy boss want you to be in your transcontinental office the next morning, not to take the red-eye.

LONDON, England (CNN) — No two ways about it, it has been a catastrophic week for British Airways.

More than 400 flights have been cancelled since Terminal 5’s launch on March 27.

Since the opening of Terminal 5, BA’s new home at Heathrow on March 27, around 430 flights have been cancelled and more than 20,000 bags separated from passengers. Questions were raised in the House of Commons, the lower house of British Parliament; environmental protestors descended; and even the Olympics torch is being bypassed to more reliable port of entry when it arrives at Heathrow on Sunday.

One week on, BA says it is gaining control. But looking further ahead, does the Terminal 5 debacle spell long-term damage for the BA brand? Or is this just another, in a catalogue of troubles that the airline will overcome?

A combination of issues threw the system into chaos last week, including staff not being able to get into the car park, problems passing security areas and malfunctions in the baggage system. Some of these problems were the fault of BAA, the airport operator. But most of the blame falls to BA for its poor preparation of staff.

Commentators added more concerns including inadequate organizational structures at BAA and BA; poor management of BA’s disaffected workforce and Britain’s regrettable record of delivering major projects.

“Heathrow and BA are my last choice combination and I used to be a Gold Cardholder,” says one UK aviation analyst, who asked to remain unnamed.

The problem, he adds, is that BA over promised and then failed to deliver.

One week before T5’s opening, Willie Walsh, BA’s chief executive boasted to British paper, The Sunday Times: “we have done as much as we possibly can and we are ready.” And on the morning of the launch, he marched around the gleaming new terminal promising state-of-the-art travel.

“If there had been a more measured approach, it would have been fine,” says the analyst.

But it was not. Citibank has estimated that disruptions and flight cancellations could cost British Airways up to $50 million (£25 million).

And even when T5 is at full strength, the problems will continue, says Chris Avery, airline analyst at JP Morgan. “Heathrow will remain arguably the worst of the European hub airports for punctuality and delays because of the two-runway layout rather than anything to do with terminals and infrastructure.”

Others are more hopeful. As Jamie Bowden, aviation industry expert and former BA customer service manager says, whilst the fiasco is clearly damaging in the short term, it doesn’t spell long-term harm for BA and its brand. “Anybody who has worked in the operational side of an airline knows that when you move terminals things rarely go smoothly at the outset.”

The unveiling of Denver International Airport was delayed by over a year. When it finally opened in 1995, its new automated baggage handling system had to be ripped out and replaced with the original manual system.

In Bangkok, cracks started to appear on the taxiways of the new Suvarnabhumi International Airport within weeks of its 2006 launch.

Hong Kong’s old Kai Tak airport had to remain open for an extra six months whilst the new at Chek Lap Kok Airport overcame teething problems.

And it took Madrid Barajas Airport weeks to deal with the backlog of luggage built up following opening of its Richard Rogers-designed Terminal 4 in 2006.

“Inevitably the most complex part of the transition will be the electrical and mechanical parts,” says Gareth Evans, aerospace and defense expert at A T Kearney. “But Terminal 5 was delivered on time and to budget. And whilst it’s clearly an overwhelming embarrassment now, I have no doubt that in a relatively short period of time it will be working and people will forget it.”

And business travelers will be the first to forgive and forget, says Bowden. “Business travelers are not sentimental about travel,” he points out.

Yet the timing of the debacle was not ideal. Firstly the failures have put BA and BAA in an unflattering light as they push for a third runway at Heathrow.

Terminal 5’s launch also coincides with opening of the “Open Skies” agreement, that puts an end to the exclusive arrangement granted to British Airways, Virgin Atlantic, United Airlines and American Airlines to fly transatlantic out of Heathrow.

Delta Air Lines, Continental Airlines, Northwest Airlines and Air France-KLM all began U.S. flights into Heathrow this week, heralding for many a new era in air travel.

But despite even this week’s disasters, Bowden believes BA will continue to prevail for flights across the Atlantic. “For business travelers transferring from Continental Europe through Heathrow to the States, BA will still have the best product. This is a brand new, state-of-the-art terminal and the lounges are great.

“If they fix it quickly, and by quickly I mean within two to three weeks, there is no reason why BA shouldn’t be able to take on newcomers at Heathrow.” E-mail to a friend

All About British Airways plc • London Heathrow Airport

Jet-fuel prices soar 79%

NEW YORK (CNNMoney.com) — Delta Air Lines said it plans to cut overall flight capacity by 6% to 8% next year due to “the global economic recession and weaker demand for air travel.” As result, passengers can expect flights to be crowded and fare deals to be scarce.

Delta (DAL, Fortune 500), an Atlanta-based carrier that merged with Northwest Airlines in October, said it will eliminate its least fuel-efficient flights in order to meet that goal. Delta intends to trim domestic capacity by 8% to 10% while only paring international seats by 3% to 5%.

“I think the action taken by Delta is a clarion call for the others to reduce their capacity,” said Harlan Platt, a finance professor and airline expert at Northeastern University College of Business Administration.

This summer, the other leading U.S.-based carriers, including AMR Corp.’s (AMR, Fortune 500) American Airlines, UAL Corp.’s (UAUA, Fortune 500) United Airlines, Continental Airlines (CAL, Fortune 500) and US Airways (LCC, Fortune 500), all said they would reduce capacity in 2008. Since then, the airlines have all discussed extending those cuts into 2009, but Delta was the among the first to give specifics, according to Ray Neidl, airline analyst for Calyon Securities.

He anticipates industry-wide capacity cuts of 4% to 5% for 2009, compared to industry-wide cuts of 10% to 11% in 2008. His estimates include domestic and international flights for the major U.S.-based carriers.

Neidl expects American Airlines to be the next company to announce cuts resulting from the recession that has dogged the economy since December 2007.

Platt agreed: “I think that American, as a consequence of never going into bankruptcy, never cut quite as deep into the bone [as competing airlines].

American Airlines chief Gerard Arpey outlined some of the company’s 2009 plans in its most recent earnings teleconference. Arpey said that domestic capacity is expected to decline about 8.5% in 2009, compared to the prior year; international capacity is expected to slip less than 1% in 2009.

A spokesman for American called the 2009 cuts an extension of cuts that began in 2008.

For 2008, Delta has said it would cut 8% to 10% of domestic flight capacity, but it would add 14% to 16% capacity for international flights, which are considered more profitable. In fact, Delta said it was continuing to invest in the Pacific Ocean, Africa, India and the Middle East.

Platt estimated that industry-wide domestic capacity cuts for 2008 could reach 20%, while Neidl believes they will be capped at 12%.

The airlines blamed soaring fuel prices for the 2008 cuts. They also added a plethora of new fees for extra luggage, pet handling, over-the-phone ticket purchases, frequent flier mile redemptions, and other services that were once included in the ticket price. Fuel costs have since dropped, though the fees remain in place.

Airlines are also cutting jobs. Delta, which employs about 75,000 workers, previously announced it would eliminate 4,000 jobs through voluntary severance packages. American Airlines announced in July that it was cutting 7,000 jobs, or 8% of its total staff, through the end of 2008.