from the Journal-Constitution
Air rivals spar over stranded passengers
By RUSSELL GRANTHAM
The Atlanta Journal-Constitution
Your airplane can't fly? No problem, your competitor will offer your stranded passengers seats on its planes.
Such agreements are commonplace in the airline industry, and even rivals such as Delta Air Lines and AirTran Airways observe them to help minimize hassles when flights are canceled.
But in the latest sign of hardball competition between Atlanta's two largest carriers, Delta has told its discount rival it wants to start charging a much steeper price for carrying AirTran passengers when problems develop.
Under the two carriers' old deal, the airline that carries the passenger is reimbursed at a fare around the industry average for the route. The change proposed by Delta would boost the fee above the highest coach fare -- raising it by hundreds of dollars in many cases. Both AirTran and Delta would have to pay it.
"It's going to cost us. We can't afford to pay full Delta fare," said Tad Hutcheson, AirTran's marketing director. "It took us by surprise, but we're actively negotiating with Delta to develop a solution."
Delta spokesman John Kennedy also said negotiations are still under way.
He said Delta, which is fighting a grueling financial slump, wants higher charges because it has seen a "significant increase" in the number of bumped passengers from AirTran.
"It's straining us to accommodate them at the current rates," Kennedy said. "We will continue to care for AirTran customers ... but our focus is on Delta customers."
AirTran said it sends thousands of passengers a month to Delta under the current interline agreement, but the smaller airline denies there has been any surge in the number. AirTran also has similar deals with six other airlines, including United and US Airways.
One industry consultant said airlines are increasingly scrapping or raising the cost of such pacts to thwart competitors at the expense of passengers.
"The congeniality that used to exist as far as the passenger being the most important part of the equation is going away," said Ron Kuhlmann, a former Swiss Air executive who is vice president of consulting firm Unisys R2A.
Delta's move "raises the uncertainty" for AirTran's passengers, he said, adding that Delta is "trying to give AirTran a bad reputation in difficult situations."
Delta could also generate more revenue, he said, but it's a dicey strategy.
"It could of course come back and bite them, because it's not terribly good public relations," he said.
But he predicted a relatively small number of passengers will be affected because AirTran, like most carriers, completes about 99 percent of its flights.
The dispute is another spark in the long-smoldering fight between the ailing big Atlanta airline and the smaller discount carrier, which since Sept. 11, 2001, has kept growing and opening new routes that compete with Delta.
AirTran this year started service between Atlanta and Los Angeles and Las Vegas, longtime Delta strongholds. This fall it starts flights to San Francisco and Washington's Reagan National Airport.
AirTran plans to quadruple its flights next year out of Dallas-Fort Worth airport, a stronghold for American Airlines that is also Delta's smallest hub.
Meanwhile, Delta last week announced new service from Atlanta to Freeport, a Bahamas island city served by AirTran. Monday, Delta said it's also offering Atlanta travelers double miles in its frequent-flier program for flights to Freeport.
Delta has been fighting the growing competition from AirTran and other discounters with its own low-fare start-up, Song, and by increasing flights, matching fares and offering double or triple miles in its frequent flier program on some routes.
Air rivals spar over stranded passengers
By RUSSELL GRANTHAM
The Atlanta Journal-Constitution
Your airplane can't fly? No problem, your competitor will offer your stranded passengers seats on its planes.
Such agreements are commonplace in the airline industry, and even rivals such as Delta Air Lines and AirTran Airways observe them to help minimize hassles when flights are canceled.
But in the latest sign of hardball competition between Atlanta's two largest carriers, Delta has told its discount rival it wants to start charging a much steeper price for carrying AirTran passengers when problems develop.
Under the two carriers' old deal, the airline that carries the passenger is reimbursed at a fare around the industry average for the route. The change proposed by Delta would boost the fee above the highest coach fare -- raising it by hundreds of dollars in many cases. Both AirTran and Delta would have to pay it.
"It's going to cost us. We can't afford to pay full Delta fare," said Tad Hutcheson, AirTran's marketing director. "It took us by surprise, but we're actively negotiating with Delta to develop a solution."
Delta spokesman John Kennedy also said negotiations are still under way.
He said Delta, which is fighting a grueling financial slump, wants higher charges because it has seen a "significant increase" in the number of bumped passengers from AirTran.
"It's straining us to accommodate them at the current rates," Kennedy said. "We will continue to care for AirTran customers ... but our focus is on Delta customers."
AirTran said it sends thousands of passengers a month to Delta under the current interline agreement, but the smaller airline denies there has been any surge in the number. AirTran also has similar deals with six other airlines, including United and US Airways.
One industry consultant said airlines are increasingly scrapping or raising the cost of such pacts to thwart competitors at the expense of passengers.
"The congeniality that used to exist as far as the passenger being the most important part of the equation is going away," said Ron Kuhlmann, a former Swiss Air executive who is vice president of consulting firm Unisys R2A.
Delta's move "raises the uncertainty" for AirTran's passengers, he said, adding that Delta is "trying to give AirTran a bad reputation in difficult situations."
Delta could also generate more revenue, he said, but it's a dicey strategy.
"It could of course come back and bite them, because it's not terribly good public relations," he said.
But he predicted a relatively small number of passengers will be affected because AirTran, like most carriers, completes about 99 percent of its flights.
The dispute is another spark in the long-smoldering fight between the ailing big Atlanta airline and the smaller discount carrier, which since Sept. 11, 2001, has kept growing and opening new routes that compete with Delta.
AirTran this year started service between Atlanta and Los Angeles and Las Vegas, longtime Delta strongholds. This fall it starts flights to San Francisco and Washington's Reagan National Airport.
AirTran plans to quadruple its flights next year out of Dallas-Fort Worth airport, a stronghold for American Airlines that is also Delta's smallest hub.
Meanwhile, Delta last week announced new service from Atlanta to Freeport, a Bahamas island city served by AirTran. Monday, Delta said it's also offering Atlanta travelers double miles in its frequent-flier program for flights to Freeport.
Delta has been fighting the growing competition from AirTran and other discounters with its own low-fare start-up, Song, and by increasing flights, matching fares and offering double or triple miles in its frequent flier program on some routes.
