Scanning Recent Headlines About the Airline Industry ...

... reinforces the thought that the air carrier business is redefining itself, or is in serious need of redefinition. From the recent U.S./EU agreement on deregulating the international skies to baggage fees to airport agreements, the industry is changing. There’s a new model coming … watching sausage being made might be a prettier exercise to watch. Of course, airline/airport agreements have been evolving significantly over the past two decades. As airlines have come and gone, airports have moved to get more control of their entire footprint. Many have gone or are going to common use systems – unplug one carrier, plug in another. But the airline industry itself is facing new challenges, some brought on by the carriers. Case in point: baggage. There are the baggage fees, which are reaping new income for airlines, but at the cost of encouraging customers to carry on the bags. A ripple effect is that passenger processing times at airports is impacted, as is the boarding process. The Association of Flight Attendants this week points out another drawback: more than 80 percent of flight attendants in a survey were hurt in the past year by hoisting or stashing passengers' carry-on bags, which have grown in size and number since airlines started imposing fees on checked luggage, says the union. Then there’s Congress, which is often compelled to tell the airlines how to run their businesses. Under consideration currently is a bill to set a size limit on carry-on bags. They could not be bigger than 22 inches long, 18 inches high, and 10 inches wide. The Transportation Security Administration would enforce the regulation (like they need something else to be responsible for). And there’s the April 29 deadline fast approaching which will see airlines fined for extended ramp delays. The Air Transport Association is staunchly opposed to this action, and several carriers are asking for exemptions at airports where construction (JFK) could affect their ability to comply. (DOT is taking comments on the airlines’ petition through April 9. Visit http://www.regulations.gov for details.) Bigger picture, airline alliances are reshaping the international airline industry. Consultant Mike Boyd suggests that such alliances are the future of the industry. A next logical step in this development is to allow more foreign ownership involvement, something negotiators avoided addressing in their recent U.S./EU agreement. If there is any industry that is inherently international, it is the airline business. Considering the difficultly in making airline economics work to profitability, more cross-border ownership seems a given, yet governments continue to fight it. Let the sausage making begin. It may not be fun to watch (or experience), but it makes good copy. Thanks for reading. jfi