Good Stuff from Joan Eisenstodt

I am astounded that the industry, at least as far as I can see, is not talking about even more airline cuts today.  CO announced cuts in flights and personnel.  This on top of DL, AA and UA.  The capacity cuts are going to impact meetings beyond anyone's comprehension I fear. And yet, I'm not seeing this as a subject that is being addressed on the web sites of the industry organizations.  On another list I moderate (http://www.mimegasite.com/) we are talking about it ..but few are joining the discussion. 

Are heads buring in the sand?  Are so few (planners, meeting participants, CVBs, hoteliers, etc.) not a wee bit nervous about the impact on the ability to attend meetings?  I am not aware of many (any?) contracts that allow meetings to be canceled bec. airlines cut their lift!

I'm watching the flights I have booked for the coming months to see  how many are re-routed by the airlines as they cut more flights.

This, from a travel co., was sent to me by a client.  Mr. Klepser has given me permission to post this here.

Wanna talk more about this?  I sure do!

This was sent to me by a client; I requested and received permission from Mr. Klepser to post it.  Note: this was sent before CO's announcement today.

From: Howard Klepser [mailto: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it ]
Sent: Thursday, June 05, 2008 8:44 AM
Subject: Air Travel Market Changes

 You may have noticed in this morning's paper that United Airlines announced that they will ground an additional 100 aircraft and furlough another 1100 pilots and flight attendants. Additional route cuts and capacity reductions beyond the 9% already planned will be disclosed shortly.

 Obviously the rapidly changing air travel market has an impact on business travelers and consumers flying for leisure or other purposes. It also has a heightened potential impact to Professional Associations who wish to move large groups of travelers to a meeting or conference venue.

 I and my counterparts within the major airlines, whom I speak with almost daily of late, see no indicators suggesting a moderation of the factors prompting rapid escalation of fares so far this year and just as rapidly deescalating seat inventory and flight frequencies.

 When the full scope of the airline industry restructuring, much of which is still in the planning stages, is felt by the wider populace; discretionary travel of virtually any kind will face many new challenges. Let me give you a couple of examples which occurred this week.

•  Registration is just opening for a meeting planned by a client organization for Palm Springs, CA to occur in October with a target attendance of 650. The nature of the meeting concentrates the travel pattern to the actual start and end of the meeting. Without seeking my input, Palm Springs was selected to take advantage of attractive hotel pricing based on the shoulder season for that market. Palm Springs can often be a tough city for air travel group movement anyway, but airline route restructuring has created the need for ground shuttles from Ontario Airport near L.A. just to find reasonably priced air inventory at necessary times/dates. Traveler convenience aside, these costs cancelled (and then some) any hotel rate advantages.
• We have been working with a corporate customer to put together an incentive trip for their top clients that involves most "meetings" occurring on the golf course or around the pool. The customer's CEO selected Punta Cana in the Dominican Republic after thoughtful consideration of our cautions about limited gateway connection cities and the meeting dates falling within the heart of the hurricane season. He fell in love with the resort and the small group size of 160 made it possible for us to work through the limited air options.

Although it isn't public yet, as part of their route restructuring American will be discontinuing some MIA-PUJ service and adjusting the schedule for the remaining flights. These changes resulted in the outbound mis-connect of all but 40 of these passengers with no other availability to be found on any carrier without an en-route overnight. Therefore, we're re-working the entire group movement plan which looks to be headed toward a charter operation from a gateway city to/from Punta Cana. This was a thoroughly considered and carefully planned meeting that airline decisions literally changed overnight.

 I share these examples with you to emphasize the need for increased attention to air travel with all meeting and conference planning. I firmly believe that within the next few months air travel options and costs will be near the top of the list of factors potentially retarding attendance at a major conference.

 I completely recognize the non-dues revenue represented by the hotel segment of a meeting's travel program that has historically caused more attention to be focused on this area. Hotel revenue is of course still dependent on people occupying those rooms by flying to the destination.

 In general, we've all been spoiled since many large meeting venues are also major leisure destinations that have enjoyed significant lift and ample low fares. Once these changes hit, the data I'm seeing looks like cities such as Orlando and Las Vegas will see an overall reduction in seat inventory of up to 18% matched with flight frequency cuts that will limit connecting options from many secondary markets. You can be assured that most of this reduction will not come from the high fare categories. Now, let's throw in the likelihood that at least one of the smaller low fare carriers will not make it through the next winter, if that long, and will join one of 25 other airlines worldwide who have already abruptly ceased operations.

 The answer I believe is for us to work more closely together than ever before to assure that what is becoming a total makeover of the air travel industry doesn't drag down conference/show attendance. As you'll recall, we've been working on another upgrade to our data platform, on-line booking system and services mix to focus greater emphasis on the needs created or magnified by this industry change. I anticipate the release of the on-line booking system upgrades perhaps by as soon as the end of this week and will be in touch with demo site information.

 After that, I'll be contacting you to schedule a meeting to discuss strategies specific to your organization to confront the challenges of the new air travel environment. I hope that you'll be able to make some time available for what I believe will be an important and pertinent discussion. Thanks, I'll look forward to seeing you soon.

 Howard

 Howard C. Klepser

President

Innovative Travel, Inc.<<