MAKING PASSENGERS MAD
Why the Big Airlines Can't Get Off the Ground
By MICHELINE MAYNARD
 PALEONTOLOGIST might call it a mass extinction event.
US
Airways has filed for bankruptcy once again, and it will need a miracle
to keep flying more than a few months. Delta seems bound for Chapter 11
in the next few weeks as well. And no one can tell if United, in
bankruptcy since 2002, will ever get back on its feet.
Clouds
of imminent financial doom have surrounded one major airline or another
for years, and experts have been looking for a culling of the herd at
least since the deep slump in air travel after Sept. 11, 2001. But
now all six major airlines are suffering at once. US Airways, Delta and
United are already stumbling like dinosaurs in a tar pit, and American,
Continental and Northwest need only one big setback to push them in.
And this is happening at a time when passengers are once again crowding
planes and airports, and the industry should be enjoying a boom. Why
are so many airlines struggling now? High fuel prices and the post-9/11
slump have taken a toll, to be sure. But many in the industry -
including some of the major-airline executives themselves - say the
traditional airlines are finally being brought low by a more
fundamental problem of their own creation, one that has been building
up for years. Simply put, they have taught their customers to resent them, and to resist paying the fares they need to make a profit. "People's
expectations for airline service are pretty low," said Peter Cappelli,
professor of management at the Wharton School of Business. The
situation is so dismal that "things could deteriorate another 20
percent and I'm not sure you could calibrate the difference," he said. Year
after year, under chronic financial pressure, the traditional airlines
have made flying less comfortable and less convenient for most
passengers. In addition to the cramped seats on crowded planes, with
cutbacks or extra charges on nearly ever facet of service from the food
to baggage allowances, travelers navigate complicated fare systems that
still exact sky-high "full" prices from some passengers while dangling
ever-changing discounts before others. These systems, intended to reap
as much revenue as possible while still filling the plane, have left
consumers feeling that there is no such thing as a fair price for air
travel and have encouraged them to game the system. On top of
that, the airlines have added one restriction after another to their
tickets in recent years, making it expensive or impossible for
passengers to change their travel plans after booking. The chief
consolation offered for all these irritations - frequent-flier miles -
have been drained of value as the airlines make redemption harder by
limiting the available dates and seats. And in recent months,
several of the major airlines have begun charging a $5 fee to buy
tickets over the phone and $10 to buy them at an airport counter, where
"How can I help you?" used to be free. Even the airlines' "hub
and spoke" route systems became a nuisance for many passengers. Though
they brought new air service to many smaller cities, they forced
harried throngs of passengers to make connections in crowded hub
airports to get where they wanted to go, rather than be able to fly
nonstop. Meanwhile, the major airlines set a trap for themselves in the
1990's, when the long economic boom produced some fat years that many
executives thought would go on indefinitely. In an industry
already famed for high pay and lavish benefits, companies locked in
high, hard-to-cut costs with union contracts that were the envy of the
labor movement. The airlines could afford those costs only as long as
the public was willing to pay high fares for their reputation and
service. The rapid growth of discount airlines like Southwest
and JetBlue, with their bare-bones service and lack of pretensions,
shows what many passengers think of that proposition now. These
airlines, which have never held themselves out as anything more than a
way to get from here to there, can charge much less than the old majors
and still make money because they have avoided the big airlines' big
mistakes.
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