GO
Loading...

Customer Service Suffers as Airline Industry Recovers

As frustrated as travelers may be with crowded planes and delayed flights, these are the realities of the leaner U.S. airline industry as it claws its way back to profitability after a brutal years-long slump.

If carriers want to ensure long-term survival, they say they have no choice but to restrain capacity, fill as many seats as possible and cut costs wherever they can.

And for travelers who don't like it, there is always the bus.

Experts say carriers are unlikely to lose much business as a result of recent big snafus like Wednesday's systemwide computer glitch at UAL's United Airlines that delayed nearly 270 flights.

In the end, carriers' bottom lines are better served by running tight ships, even if that means the occasional customer service nightmare, they say.

"On one hand, it's good because it puts airlines closer to profitability," airline consultant Michael Boyd said. "On the other hand, it's bad because there is no excess slack in the system."

U.S. airlines are on the mend after years of losses stemming from terror concerns, soaring fuel costs and low-fare competition. Since 2001, four major carriers have slashed costs in bankruptcy. Meanwhile, many carriers have reined in capacity -- the number of seats for sale -- to fly fuller planes.

The Air Transport Association, a U.S. industry trade group, says planes on average will be more than 80 percent full this summer as a record 209 million travelers take to the skies.

"The carriers' actions are paying off," ATA spokesman David Castelveter said. "They're starting to make money. Their airplanes are full."

U.S. airlines earned some $2 billion to $3 billion in 2006, the industry's first annual profit since 2000, the ATA says.

Angry, Displaced Travelers

The downside to flying full planes is there are fewer seats available to accommodate people displaced by canceled flights. As a result, travelers can be stranded for hours or even days.

"In the old days, when flights were half empty, delays were less stressful," said Joe Schwieterman, an airline expert at DePaul University. "Nowadays delays mean almost intolerable crowding both in airports and on airplanes."

"I faced a five-hour delay at Reagan (National Airport, Washington, D.C.) last week. It was terrible," he said.

The U.S. Transportation Department will release statistics this summer on delays in the first half of 2007. Experts say delays are either getting worse or simply getting more media attention in the wake of a weather-related delay that disrupted JetBlue Airways service for several days in February.

Weather-related delays are unavoidable, and airlines and the ATA are quick to note deficiencies in the aging, radar-based air traffic system as another cause of delays.

The Federal Aviation Administration says the system is reaching its capacity and the agency is focused on cutting delays and volume on heavily used routes.

The ATA said more than half of all the delays in 2006 were the result of factors beyond the control of airlines.

But frequent travelers such as California real estate agent Kate Hanni do not want excuses. They just want to reach their destinations on time.

Hanni said she was stranded on a grounded AMR's American Airlines plane in Austin, Texas, in December for nine hours. That prompted her to form the Coalition for Airline Passengers Bill of Rights, to collect complaints about major delays and seek industrywide agreement on passengers' rights.

"I know a lot of people who are saying 'if I can avoid flying, I will,"' Hanni said. "People are saying enough is enough."

A Monkey's Attention Span

Yet experts like Boyd say it is unreasonable to expect airlines to park unused multimillion-dollar aircraft at airports simply to brace for potential service disruptions.

It is a common misconception among air travelers that they can be insulated from the many hassles that can arise in an unpredictable business like air transport, he said.

But no matter how wronged a passenger feels by an airline, travelers care more about price than customer service once the annoyance of a protracted delay wears off, Boyd added.

"It doesn't change the fact that consumers have the attention span of a monkey," Boyd said. "The next time they go to Fort Lauderdale, they're going to book whatever seat is the cheapest."

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More*

Don't Miss

U.S. Video