2008 Business Travel Lessons

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Slow and Steady Wins the Airport Race

This was going to be the year of the new airport terminal, with major facilities opening at London's Heathrow Airport; New York's John F. Kennedy International Airport; Raleigh/Durham; Indianapolis; and Detroit's Metro Airport. This year I learned that it really does pay to delay your opening if you need extra time to get everything right. You may take a publicity hit for a blown deadline or two, but you won't suffer the disaster than befell Terminal 5 at Heathrow. It opened bang on time in late March—but was a nightmare of lost bags, missed connections, worldwide ridicule, and money-gushing make-goods for British Airways. Heathrow's owner, B.A.A., paid a bigger price: British regulators last week ordered the subsidiary of Spain's Ferrovial to sell its other London airports, Gatwick and Stansted. The four U.S. facilities shifted their launch dates by a few weeks and opened without notable incident or embarrassment.

Not All Fees Are Created Equal

The airlines turned 2008 into the year of à la carte pricing, unbundling just about everything from the basic ticket price: checked luggage; advance seat selection; in-flight meals and beverages; fuel costs; and even blankets and pillows. The goal, of course, was to charge lower-fare customers for all the little niceties that once were free. Passengers pushed back hard against the fuel surcharges, even as oil prices soared to record highs. They reacted indifferently to the concept of paying for seat selection and largely ignored the airlines' buy-on-board meal programs and buy-a-blanket plans. And they seemed to accept without complaint the concept of paying for checked luggage. The free second checked bag disappeared from most domestic flights as early as February. By the summer, American Airlines was also charging for the first checked bag. Virtually all of American's major competitors have now fallen in line, reckoning that they were leaving money on the table by giving away something for which passengers would willingly fork over $15.

No Longer Almighty, the Dollar Is Resilient

When the U.S. dollar fell to record lows earlier this year and made international travel insanely expensive, there was no reason to believe the once-Almighty Dollar would ever regain its luster. But worldwide financial crises can be the dollar's best friend. The Australian, New Zealand, and Canadian dollars have given up years of gains against the U.S. dollar in just a few months. The British pound, trading above $2 for much of the year, has crashed. It closed last week below $1.50, which is about where it was trading before 9/11. And while the dollar has zigzagged crazily against the euro in the last week, it closed below $1.40, a far cry from the $1.60 level it had reached early in the year. The notable exception: the Japanese yen, which has gained about 15 percent against the dollar lately. In other words, don't plan any trips to Tokyo.

The Fine Print…

One thing I have long known that you should learn: Never believe what an airline says about its future route plans. Earlier this year, big carriers were crowing about their new flights to China. Virtually all of them were cancelled or delayed indefinitely. And United Airlines, which began a heavily publicized daily Washington-Beijing service last year, has slashed the route back to just a few flights a week. It has also switched to a smaller aircraft to further reduce the number of seats it flies between the two capitals.

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