The Brancatelli File



October 27, 1993 -- How much are business travelers willing to pay to fly 407 miles? And what should business travelers expect in the way of service on a flight for which they've just paid 68 cents a mile?

Obscure as these questions may seem, they go right to the heart of the uneasy relationship between America's unhappy army of business travelers and the nation's financially battered airline industry.

No matter what the public perception may be, business travel is rarely glamorous. It isn't about flying down to Rio or jetting off to Paris.

Business travelers spend most of their lives in the air on short-haul flights between rather prosaic domestic destinations. Short-hop flying is where business travelers need comfort and convenience and, most of all, value for money.

Short hauls are also where the airlines are supposed to make their profit. That's because business travelers willingly pay a premium to hop on a plane on short notice and get to places like Cleveland or Minneapolis or Pittsburgh or Portland.

Unfortunately, the short-haul system isn't working for business travelers or the airlines. Business travelers pay too much and get too little for their short-hop dollar. And airlines aren't making any money.

One example of the business traveler's short-haul plight: the 407-mile route between Cleveland and Newburgh, New York. The one-way unrestricted fare for this route--the equivalent of a flight between LAX and Reno--is $278.

What do business travelers get for their 68 cents per mile? For one thing, they get to change planes in Pittsburgh because there are no nonstop flights. So the trip requires more than three hours of elapsed travel time.

On one recent 7:30 a.m. departure from Newburgh, business travelers received nothing more than coffee and a small container of juice. Not even the proverbial crust of bread was offered, even though most of the travelers on this flight had no other opportunity to eat breakfast.

Working during the flight was next to impossible. The seats were so small and the rows placed so close together that there wasn't even room to open a newspaper or a briefcase.

You can imagine the annoyance of the business travelers who made this trip. For their $278 fare, they couldn't work, weren't fed, stopped in Pittsburgh and wasted three hours of their business day.

On the flip side of the equation is the parlous state of the airline industry. Providing even this lackluster brand of service has been prohibitively expensive.

Airlines collectively lost about $8 billion in the last three fiscal years. During the same time, six of the nation's 13 major carriers landed in the bankruptcy courts. Three of the airlines eventually stopped flying.

However belatedly, the change is coming.

Some of the change is bad for business travelers. Most major carriers have closed at least some of their unprofitable airport hub operations, thus reducing the number of short-haul flights available.

Some of the change is good. TWA, for example, has essentially eliminated its traditional coach class cabin. In its place is Comfort Class, which features seats with footrests and substantially increased legroom. Seats in Comfort Class on TWA cost no more that standard coach on other airlines.

Some of the change is derivative. Continental Airlines, for example, has introduced Continental Lite in many markets in the south and east. Continental Lite mimics Southwest Airlines: Fares are low and carry minimal restrictions, flights are frequent and avoid crowded hubs and amenities are scarce.

And some of the change in short-haul markets is positively original. New carriers such as Reno Air in the west and Kiwi International in the east have been launched specifically to provide short-haul service at reasonable prices.

Both upstarts offer good, simple in-flight amenities like roomy seats and fresh snacks. And they do so at fares that are far below what the entrenched major carriers charge.

Not surprisingly, both have turned a profit in at least some months during their first year of operation.

"We think we give business travelers a better deal" on short-haul flights, explains Beth Mack, Kiwi's vice president of sales and marketing. "And because we're smaller, we can charge less and still make money."

Business travelers who didn't book transatlantic tickets during the fare war scheduled to end last Friday have another chance. The ticketing deadline has been extended to November 1. Fares to most major European destinations are as low as $598 roundtrip and require a 7-day advance purchase. Fares to London, Paris and Frankfurt are lower, but have different restrictions. Business-class passengers on Virgin Atlantic Airways already receive complimentary limousine transportation to or from Heathrow Airport in London. Now the airline has added complimentary chauffeured motorcycle service. Each motorcycle has heated seats and running boards, hands-free portable telephone and storage space. The airline even offers passengers weather-proof clothing. The 1994 Zagat Survey of Atlanta restaurants has chosen the Dining Room in the Ritz-Carlton Hotel in Buckhead as the city's top dining spot for food, decor and service. More than 450 other Atlanta restaurants are also rated.

This column originally appeared in The Los Angeles Times business section.

Copyright 1993-2007 by Joe Brancatelli. All rights reserved.