Vegas Hotel Rooms Growing; Flights Shrinking
Hotels rooms in Vegas are growing rapidly but flights are disappearing. How are they going to find enough people to fill all those rooms?

Hawaiian Adds Winglets to Some of Its 767 Fleet
Hawaiian is putting winglets on nearly half its 767 fleet. Why aren’t they going all the way? Is it really worth it to put these on?

United Double Second Bag Fee to $50; Unfairly Blames Fuel
Fuel prices are dropping like a rock, yet United is still blaming their “volatility” for adding on extra fees. Hmm, the word disingenuous comes to mind . . .

Does Spirit Really Have the Best Operating Margin in the US?
Spirit reported the best operating margin of all US carriers in the second quarter. Why isn’t this all that it seems?

United’s Fuel Hedges are Underwater
Fuel prices are down, so that means some fuel hedges are going to mean higher costs for airlines. United said it could lose millions, but this isn’t necessarily bad.

To be honest, I’m really surprised that it took this long for an airline to do this, but if anyone was going to take the plunge, it’s Spirit. The airline has decided that it’s time to plaster aircraft interiors with advertising. Welcome to the subway in the sky.

From what I can gather, Spirit will now sell ads on overhead bins, seat backs, tray tables, the area above the windows, bulkheads, napkins, cups, menus, boarding passes, soap dispensers, and yes, even trash bags. And if you can suggest another place to put it, I have no doubt that they will.

The benefit to passengers is clear. More ad revenue means that the airline can make money on lower fares (though check out today’s post on BNET for a little more on their profitability). As long as you’re willing to endure ads everywhere, this can benefit you. And really, Spirit is the right airline to do this.

But what about for advertisers? It cracks me up the way Spirit sells onboard advertising in the press release. “Why pay for a five-second gaze time on a billboard when you have more than 2,000 times the viewing exposure aboard a three-hour flight?” Yes! I’m in. I think it’s time to revisit my original Skybus plan . . .

I had to go to LAX three times this weekend to pick up and drop off some friends, and while I was there, I saw a few flashing signs noting some of the terminal shifts that have taken place lately. What’s going on? This is all to make more room for Virgin’s expected expansion.

In short, most of the airlines in Terminal 3 are moving elsewhere so that Virgin America and V Australia can move in and grow. I spoke with Abby Lunardini at Virgin America, and she told me that they will only take three gates to start. I can’t imagine V Australia will need a full gate for their flights when they start this winter, but even if they do take one, that still leaves two empty gates for Virgin America to expand in to if they want.

So, here’s where everyone else is moving. AirTran moved to Terminal 6 on Sept 5 while Frontier moved on Sept 8. Spirit and Sun Country will also move to Terminal 6, though both airlines are reducing or eliminating flights to LAX in the coming months. Midwest will move to Terminal 4 with American. The latest LAX map reflects all these changes.

Alaska and Horizon will continue to operate out of the six gates on the west side of Terminal 3 (marked in blue on the map at left), but Virgin America and V Australia will now take three (maybe four if V Australia has its own) of the six gates on the east side (marked in red on the map at left).

Virgin America says that they are “planning to update the space and help re-establish views of the runway and cityscape.” That’s what will happen before they move in. They are also “working with LAWA on the Phase 2 renovation, which will focus on creating a more guest-facing experience using innovative and sustainable design principles (with a bit of a retro twist back to the terminal’s original 1961 design). Now that’s something I’d love to see, but I do wonder how much effort Virgin America should be putting into this when they need to focus on running their business.

The move to Terminal 3 for expansion purposes isn’t a bad idea with everyone else reducing service at LAX, but I am curious to see how they use the new gate space. They act like they’re in expansion mode, but it was recently announced that they’d be operating charters for Myrtle Beach Direct Air. Abby tells me that they’re in an 18 month agreement on that one. It’s surprising that they don’t have a place within their branded operation to put that airplane, but it could be telling about the state of the business right now. So where will we see them use their new gate? They’ve talked about Miami and Chicago/O’Hare flights, but nothing has been announced. They could also try and connect the dots by flying to Vegas, though that’s a pretty crowded market. I suppose we’ll find out soon enough.

Virgin America has yet to move in, and I’m still waiting to hear a final date from the airline I’ve now been told they’ll switch at the end of October. I’ll keep you posted.

I tried not to do it. Really. I wasn’t going to write about Spirit’s MILF sale, especially since every other travel blogger has already done it. But after reading the latest round of posts on the subject this morning, I just had to do it.

Why is everyone freaking out about this?!?

The sale ended last night, so this is old news, but the strange controversy lives on. Brief background: Spirit Airlines (based in Ft Lauderdale) launched a sale called the MILF sale. That was said to stand for “Many Islands Low Fares” but in pop culture it means “Mother I’d Like to F***.”

Spirit claimed they didn’t know what it meant, but please, that can’t be true. Spirit is the king of these types of promotions, and I’ve written about it many times. My personal favorite was the Mullet sale with the line “Business in the Front, Party in the Back.” Cheesy? Hell yeah, but I’ll bet it’s effective.

Think about it. How many people know Spirit? Probably not that many in the grand scheme of things. How many people like cheap fares? Um, everyone. If you have extremely cheap fares, you aren’t going to be able to spend a lot of marketing, so, how do you get people to know that you have those fares? Get the media to tell everyone for you. How do you do that? Do something outrageous that will grab their attention.

This time, they’ve succeeded. I’ve seen this sale picked up not just by bloggers but by the national media over the last couple of days. Everyone is talking about it, and most people are “outraged” at such a thing. Let me say something to those outraged people. First of all, you people need to find a hobby. Second of all, you’ve fallen right into the airline’s trap. The more you talk about it, the more likely they are to do it again. Way to go.

Remember, this is Spirit. This isn’t an airline trying to be anything other than cheap transportation. Is it offensive? I really don’t see how it is, but if everyone else thinks it is, that’s better for them. So, if you really are outraged by this, then stop complaining. You’re just helping them.

I, on the other hand, think that this is a really smart move. Everyone is talking about it, and that’s going to lead people to their website to take a look. If even a fraction of those resulted in bookings, it was a successful promotion.

Spirit announced its new livery today, and I’ve got some early pics for you to see. I was definitely not a fan of the old livery (it looked better before they went from the purple to black). This one is better suited for the “ultra” low cost leisure carrier that they are, I’d say, but that is still a dizzying array of colors to take in. Thoughts?

Anyone catch the significance in American’s latest announcement last week? I suppose it’s not really “significant” in any way. It’s more of the same old crap. Yup, legacy carrier tries to fight a low cost carrier in a market that they have no business being in.

This time, American is going after Spirit down in South Florida. It’s no secret that Spirit has been growing their presence out of Ft Lauderdale to a bunch of Caribbean and Latin American destinations lately. American, of course, has the huge Latin presence out of Miami, and they’ve apparently decided to try to knock Spirit down a couple notches.

So now, American is starting up Ft Lauderdale to San Jose (Costa Rica), and Santo Domingo. They’ll also beef up the number of seats from the airport to San Juan and Port-au-Prince.

Raise your hand if you think there’s really enough demand for two carriers in the market? Nobody?

It’s just the same tired old story. American probably has planned it this way . . . . Big legacy carrier moves into a market where it really doesn’t need to be. They’ll fight for awhile, potentially get the little guy out, and then they’ll pull all service out. As usual, the consumer is worse off and has to go back to paying really high fares out of Miami with no other options. But hey, American is happy!

The problem is that it doesn’t seem to work that way as well as it used to. Now, American will just waste a lot of money trying to put the little guy out of business, not succeed, quietly pull out of the markets, and go on making different dumb, revenue negative decisions. Glad I’m not a shareholder.

I believe Spirit’s transformation is now complete. Yesterday they launched what I believe is the first $0.01 sale they’ve run (it ends tonight). I know they ran a $0.05 sale, but this could be the first time they’ve tried to prove that a penny isn’t irrelevant. (Actually, it still is because you have to pay taxes, but I digress.)

So what do I mean by transformation? Well, they used to be a low cost carrier that didn’t stand out from the pack. In the last year, they’ve basically stripped everything out of the fare that they can to become an “ultra” low cost carrier. Pay for checking bags, pay for drinks, pay for just about anything beyond your seat. That’s how they can offer these $0.01 sale fares that Ryanair perfected long ago. While we’re at it, can you tell which one of these pictures is from the Spirit homepage and which is from the Ryanair homepage?

Ok, so maybe the dollar sign vs. pound sign thing is a dead giveaway, but other than that, they’re pretty similar. I hope they don’t get too comfortable down there in the basement because competition is coming. Skybus is still working on certification and should be joining them shortly.

Spirit, in their never-ending pursuit of ancillary revenue, launched the $9 Fare Club yesterday. In short, you pay $9 for a three month trial ($29.95 annually after that), and you get a list of deals reserved only for members at least once every 6 weeks.

Is it worth it?

Personally, I’d take the wait and see approach here. Looking at the first deal list they launched yesterday, there are some hit or miss fares in there. Of course, they have the obligatory $9 one way fares in many markets, but they’re only good on 4 random dates in the next few months. If you can be flexible and they happen to have your city there, it’s great and you should sign up now to take advantage (fares expire tonight).

They also have $99 one way fares available for all Tuesday, Wednesday, and Saturday travel between April 17 and June 30. I randomly picked May 9 returning May 16 in a couple of markets to see where the public rate stands. If you’re going from LAX to Detroit, it’s a good deal. Fares are currently $159 each way so this will be worthwhile, even if you had to pay $29.95 for the full year membership. On the other hand, if you’re flying from Myrtle Beach to Ft Lauderdale, forget it. The current fare on the nonstop flight is $59 each way, $40 BELOW the sale fare.

Assuming they continue to publish the deal list publicly to entice new members, you’re best bet is to just keep tabs on it. If you see a fare you like and it saves you more than the membership fee costs, then you can join right there and take advantage. If there are no fares you like, wait for the next ones to come out. This all changes if they stop publicly displaying the fares of course, but for now, it’s the best way to go.

A couple of random things you’ll want to know:

• Every person who wants to book the sale fares has to have a separate membership
• If you have the Spirit-branded credit card, you get free membership
• To sign up, you have to enroll in the frequent flier program
• If you do sign up, they’ll continue to auto-renew every year unless you cancel, so make sure you mark the renew date down so you can cancel if you’re not happy

In short, this could be a helpful program for you as long as you find fares you can use. Personally, I think the idea is a decent one, but I do wonder about its legality. The DOT has been very concerned about making sure that publicly advertised fares are readily accessible, and it seems like this might not be what they had in mind. Then again, I’m sure Spirit has done their homework here, so it should be fine.

It’s interesting to see how low cost carriers developed differently in the US versus Europe. Over here, Southwest was always considered the standard for low-frills and low fares. When compared to what Ryanair has done in Europe, Southwest looks downright pricey and opulent.

Since Ryanair has taken off, plenty of people have made an effort to bring that model over here. Allegiant has fashioned themselves in a similar way but their fares aren’t nearly as low and their route network focuses on small cities that don’t help most of the US. Skybus has announced its intention to bring the model to the US, but they are still in the process of getting started. It appears that Spirit is now going to be the first to give this model a real shot here in the US.

The basic idea is to offer very low fares just to get people on the plane and then charge them extra for every little thing they’d like above and beyond basic transportation. Spirit has definitely been heading this way for some time - you’ve seen fares as low as a nickel popping up for a few months now. Today, they’ve decided to take the next step to becoming what they call an “Ultra Low Cost Carrier.” This all begins today for travel starting June 20.

First off, they’re killing their premium cabin, Spirit Plus. Instead of taking the seats off the plane, they’re just renaming them the “Big Front Seat.” The service will be exactly the same, but you can pay more just to get a bigger seat. Looking at random dates in the middle of July, a one way from Los Angeles to Ft Lauderdale is $124 in what they now call “Deluxe Leather” (also known as “Coach” in non-marketing, normal person language). The Big Front Seat is going for $544. I can’t imagine anyone is going to pay that much more simply for a larger seat, so I imagine they’ll have to reevaluate their pricing soon.

They don’t offer too many details in their press release, but the South Florida Sun-Sentinel seems to have the scoop. They say that you will be allowed one carry on bag for free and that’s it. All checked baggage will now cost you. It’s $10 a bag for the first two and then $100 a bag beyond that. By June, you’ll be able to pay online for your checked bag and then it’ll only cost $5 per bag for the first two.

And yes, even beverages won’t be free anymore. Soft drinks will now cost $1 and snacks will remain $2 to $4. To round things out, there is also a plan to make money from hotels, car rentals, event tickets, airport parking, and all that stuff.

Personally, I don’t mind this model at all as long as I can pay for what I want up front. I hate the idea of having to carry around a bunch of cash to pay for a drink, a checked bag, etc. If they can integrate all of these things into the booking process, it may work, but it’s still a tough adjustment for people used to the Southwest model. Trying this in the Caribbean where it’s a lot of leisure travel might actually pan out for them.

Lots of little things today compelled me to put out yet another edition of random bits of info. And yes, in case you didn’t know, today is the official Bob Marley Day in Jamaica. Also, I know there are a couple of Kiwis who read the blog, so happy Waitangi Day to you down there. (That’s a celebration of the founding of New Zealand through the signing of the Treaty of Waitangi.) Lots of things to celebrate and lots of news to talk about.

Expedia and American Find One Love - As some expected, Expedia and American have come to terms. You can now search Expedia for all American Airlines flights, but I don’t have an update on whether the same is true for Delta yet. The press release didn’t give us any insight into why the spat occurred, but it’s likely because American found Expedia cheating with its evil older stepsister. Tune in next week for another edition of As the Travel World Turns.

Aer Lingus and JetBlue: Is This Love? - Remember that whole thing about Aer Lingus leaving oneworld and pursuing a life of relgious fulfillment? Well, they’ve taken that first step, by becoming partners with JetBlue. This is JetBlue’s first real partnership, and it seems like a good one to me. Now Aer Lingus can send its Boston and New York customers on JetBlue flights. I’m assuming that means codesharing, but I could be wrong. It will at least involve baggage transfers and the ability to book the itinerary on Aer Lingus’ website.

Spirit Says No Baggage, No Cry - You knew that 5 cent fares on Spirit meant they’d have to make their money elsewhere, right? Then it shouldn’t be a surprise that you’re going to have to pay if you need more than one checked bag. Starting Saturday, your first bag is free, your second is $10, and any more than that should be sent ahead. Why do I say that? It’ll cost you $100 per bag to bring it with you. Of course people are complaining, but those people are also the ones who snapped up 5 cent fares. What was that about a free lunch again?

Get Up, Stand Up and Honor Lamar - Lamar Muse, one of the original founders of Southwest back in the day, passed away last night from cancer at the age of 86. Lamar’s story was an interesting one, because he and the other two founders - Herb Kelleher and Rollin King - had a falling out years ago. He left the airline early on and started Muse Air (nicknamed Revenge Air). Southwest bought the airline and turned it into TranStar before effectively shuttering it. The grudge had lasted for a long time, but I believe they buried the hatchet finally. Herb announced that $150,000 would be donated in Lamar’s name to his hometown YMCA, which Lamar helped build and to which he donated $350,000 when he died.

That’s all for today. Happy birthday to Axl Rose who has amazingly lived all the way to his 45th birthday. Another year goes by without releasing Chinese Democracy. I’m SURE it’s coming this year . . . .