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UP FRONT BARGAINS ARE HARDER TO FIND
By Joe Brancatelli
June 24, 2010 -- Uh, oh. The gravy train may be over. For the first time in years, there really do seem to be fewer international business-class deals around. And those that remain are higher in price and with more onerous purchase restrictions.
The crash in business travel that started with the oil spike of early 2008 and was magnified by the collapse of financial markets late in the summer of 2008 continues to play havoc with the airline business. So, too, have the strikes at British Airways and Lufthansa and the volcanic-ash crisis.
Bottom line? Airlines have dramatically slashed their capacity overall and have targeted premium-class cabins for special cutbacks. Several (including United and Qantas) are aggressively trading down and swapping out some of their business-class seat beds for more coach seats. Virtually all of the others are using smaller planes (with few premium-class seats) on prime routes. And, wherever possible, carriers seem to be eliminating flights that duplicate service offered by their alliance partners.
Now that business-class demand is showing its first signs of a rebound in nearly two years, airlines have clearly decided to reduce the number of discounted seats they offer. That means fewer sales, fewer blow-out bargains and much more restrictive terms for those deals that are around.
The summer business-class sales to Europe, a staple essentially created by Continental Airlines right after 9/11, have been a perfect example of the new situation. Scheduled to end next Wednesday, the sales broke earlier than ever this year. United Airlines, quickly followed by its Star Alliance partners, loaded the sale prices into computers in early January. In past years, the summer sales didn't appear until late April. Ever since January, however, the prices have crept up, the inventory has been harder to find and the new 60-day advance purchase rule (it was as modest as 14 days in previous years) has all but eliminated spur-of-the-moment holiday travel up front. If the summer sales are revived in coming weeks with less onerous advance-purchase rules, it's guaranteed that the prices will be much higher than the $1,500 entry levels introduced in January. Prices into popular destinations in France and Italy, especially, will be dramatically higher.
Across the Pacific, where deals are always hard to find since there are so many fewer flights, the bargains have dried up completely. Transpacific premium-class traffic rebounded more quickly than expected this year and the deals disappeared fast. The massive pullback by bankrupt Japan Airlines constricted the supply of seats to Japan, although there may be some discounts this fall when Tokyo's Haneda Airport reopens to transpacific flights. And the giddy ramp-up of capacity to China and India slowed when several U.S. carriers chose not to launch the flights they originally requested from the U.S. government.
The one Pac Rim bright spot: Australia. The recent entry of Delta Air Lines and V Australia broke up the decades-long duopoly between Qantas and United Airlines and that forced carriers to discount lustily up front. Fares that were approaching $20,000 roundtrip from the U.S. East Coast dropped below $6,000 with an appropriate advance purchase. From the West Coast, $4,500 roundtrips are now sporadically available.
Latin America? Forget it. Big pullbacks have made deals to Central and South America a less-than-sometime thing. But since Latin carriers are expanding their U.S. presence again, look for some deals later in the year.
Is the situation hopeless? Of course not. You'll have to pay more and plan better, but you'll still be able to fly up front and in comfort at a discount. And there is a new phenomenon emerging: Sales in the so-called "premium economy" cabins being embraced by international airlines. No, the "fourth classes" are not as lavish (or as consistent from airline to airline) as business class. But they do offer what matters: more legroom and more personal space for longer flights. And as the airlines introduce the service on more flights, they offer sale fares in the cabins. This will certainly be a category to watch later this year and in 2011.
Meanwhile, our annual primer on how and where to score the deals that do exist.
Structured Business-Class Fare Discounts Where shall we start the search for deeply discounted business-class seats? Well, how about the carriers' own Byzantine fare system? The advance-purchase business-class fare is now a worldwide staple. Depending on the airline and the route, you can score large discounts as high as 80 percent if you book between three and 60 days before departure, travel midweek and stay over on a Saturday.
What do you need to know about the airlines' advance-purchase business-class bargains? They are almost always nonrefundable and the change fees are stiff (and some carriers won't allow any changes after the trip begins). They're not offered every day. Worst of all, there's no organized way to find the fares because few airline or third-party Web sites offer a "lowest business-class fare" search option. Not every travel agent or corporate travel department knows about the fares, either. So start hunting and be flexible. And be sure to check a "fare-scraping" site such as Kayak. Choosing "Business" from the fare pull-down box will yield a blizzard of quotes from other Web sites. Kayak has even added a "Premium Economy" option to its search function.
Business-Class Fare Sales They're not as omnipresent as coach sales, of course, but business-class sales are now fairly common, too. Most last just two or three days or are targeted promotions to help publicize a new route. Some will be mounted by an airline looking to promote a counter-intuitive routing over its hub. One recent example: Finnair has been trying to develop its Helsinki hub as a connection point for American and Western European travelers headed to Asia. As a result, its up front fares into China and India are about half what other carriers charge. And, of course, the summer and end-of-year business class sales to Europe will continue, albeit with less attractive fares and less attractive purchase restrictions.
What do you need to know about these bargains? Obviously, they are unpredictable, both in terms of restrictions and availability. Worse, airlines don't always advertise the sales. For instance, Continental Airlines, which created the summer/end-of-year sale category, does nothing to publicize them. Its entire promotional effort usually consists of a single, unobtrusive link on Continental.com.
The 'Secret' Airlines In these days of gigantic airline alliances, we naturally focus on the big-name U.S. and international carriers. But there's a fleet of second-tier carriers out there and they offer good business-class service and better prices from select U.S. gateways.
Want some examples? The Italian carrier Eurofly flies nonstop from New York several times a week to several destinations in Italy during the spring and summer. Bmi flies from Chicago to Manchester, England. Air Berlin flies into Dusseldorf from the United States. Meanwhile, you'll find that Air New Zealand usually has the cheapest fare between Los Angeles and London. Aer Lingus, the Irish carrier, has positioned its Dublin hub as a jumping off point to Northern England and Scotland. Business-class fares into Dublin are always a fraction of the prices into London and Dublin will have a new terminal open this fall that should make it much more appealing as a transfer point than London/Heathrow. And don't forget about OpenSkies, BA's boutique airline that flies from Newark and Washington/Dulles to Paris' Orly Airport. Right now, the all-in fare in its "Biz Seat" cabin is around $1,400 roundtrip through September.
On transpacific routes, where flights are much longer and nonstop options not always available, second-tier operators like Malaysia Airlines and Asiana of South Korea will often promote much lower connecting fares than Cathay Pacific, Singapore Airlines or better-known carriers.
Finding these airlines and their lower up-front fares is the business-travel equivalent of a hedge maze. These guys rarely advertise at the retail level beyond their home markets and their promotion to the travel trade is also discreet. But try a good travel agent, Kayak.com, Orbitz.com or ITASoftware.com. You may luck out.
Consolidator Savings Consolidators, the third-party middlemen who offer deep discounts on international first-class and business-class travel, have less clout now that big carriers willingly and publicly sell discounted premium-class fares on their own Web sites. But contrary to expectations, consolidators haven't disappeared. In fact, they remain the best option for last-minute discounts on business-class travel. You can routinely find 50 percent discounts on routes around the world.
How do you deal with a consolidator? Most urge you to buy their fares through a travel agent. "It's just more comfortable for everyone that way," one consolidator explains. "Travel agents know how to deal with us and they are better-suited to deal with flyers." (For more background on consolidators, check this column.)
Other Useful Strategies Depending on the market, the time of the year and the whim of the airlines, there are several other ways to save big on business-class travel. Several carriers offer packages that include business-class seats, luxury hotel rooms, private-car airport transfers and other perks. If you plan ahead, the package prices for two people traveling together are often as low as the price of one walk-up business-class seat. Some carriers offer upgrades to business class if you purchase a full-fare coach ticket. And as we discussed last summer, the once-common practice of "at the gate" purchased upgrades has returned. Naturally, however, this is a space-available and ultimately unreliable tactic if you insist on a confirmed business-class ride.
A peculiar backwater of the fare structure called "round the world" tickets can also slash business-class costs. For less than the price of a point-to-point business-class ticket, an airline and its global marketing partners permit you to travel up front and visit several destinations--as long as you keep flying in the same direction. Check the excellent round-the-world primer posted by my friend David Rowell, the Travel Insider.
About That American Express Promotion Then there's the much-publicized International Airline Program, a perk offered to travelers who carry some American Express cards. Amex would have you believe that you can get a free companion business-class ticket whenever you buy one ticket from one of its 22 airline partners. But what Amex doesn't tell you is that you pay the highest walk-up business-class fare for that one ticket you are required to purchase. For leisure travelers, that is usually an awful deal since a little advance planning will usually yield two paid seats in business class for less than Amex wants you to pay for one. However, the Amex plan does have its place in the discount firmament: If you're traveling at the last minute, you may be asked to pay the walk-up business-class fare anyway. In that rare instance, the two-for-the-inflated-price-of-one program is actually a bargain--as long as you have a companion to take along for "free."
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ABOUT JOE BRANCATELLI Joe Brancatelli is a publication consultant, which means that he helps media companies start, fix and reposition newspapers, magazines and Web sites. He's also the former executive editor of Frequent Flyer and has been a consultant to or columnist for more business-travel and leisure-travel publishing operations than he can remember. He started his career as a business journalist and created JoeSentMe in the dark days after 9/11 while he was stranded in a hotel room in San Francisco. He lives on the Hudson River in the tourist town of Cold Spring.
THE FINE PRINT All of the opinions and material in this column are the sole property and responsibility of Joe Brancatelli. This material may not be reproduced in any form without his express written permission.
This column is Copyright © 2010 by Joe Brancatelli. JoeSentMe.com is Copyright © 2010 by Joe Brancatelli. All rights reserved.