Arnie Weissmann: ALSO IN THE NEWS: Richard Turen:

‘These times call for a blend Carnival records Q4, ’08 profits. 6 ‘We who sell fantasy, rejuvenation,
of hopefulness and hard- Q3 travel spending down 8%. 6 exploration and understanding
edged business judgment.’ 12 Hertz enters car-sharing market. 8 welcome the new year.’ 35
w w w. t r a v e l w e e k l y. c o m

T H E N A T I O N A L N E W S P A P E R O F T H E T R A V E L I N D U S T R Y D E C E M B E R 2 2 - 2 9 , 2 0 0 8

[ ENABLES GDS DISTRIBUTION ]

ARC adds charters

Year
2008

By Lester Craft
to its agent system
Different timing, for remitting sales
same fiscal pain
ARC recently revealed what in ordinary
in By Bill Poling

ARC has, for the first time, opened its agency

times would have been a real stunner: Its
airline booking settlements plunged by
19.7% in November, compared with the
same month the previous year.
Dismal airline traffic had been expected,
but perhaps not that dismal. And what is
dismal for the airlines, of course, is dismal
for just about the entire
ANALYSIS industry, given that most
of the travelers the in-
dustry cares about originate their journeys
on an airplane. Quite simply, fewer airline
trips mean less revenue all around.
Yet, even though the airlines are in the
throes of a precipitous decline in traffic,
they appear to be better off than they were
before enplanements tanked. Some ana-
lysts are even predicting that U.S. carriers
will be profitable in 2009, rebounding
sharply from substantial losses this year.
Meanwhile, most of the rest of the in-
dustry has been heading south. Clearly, an
unusual parting of the ways between the
airlines and the rest of travel is under way.
Airlines’ fortunes have improved, de-
spite the bleak economy, for two reasons:
First, the return of cheap oil dramatically
reduced operating costs. Second, they be-
gan downsizing several months ago, when
oil prices spiked. In contrast, the rest of
the travel industry failed to follow the air-
lines’ cost-cutting lead (not unreasonably,
given that parking airplanes is easier than
decommissioning hotels, for example).
As if to punctuate the airlines’ relative
health, carriers recently have begun se-
lectively expanding transcontinental and
long-haul routes.
Even so, unless overall travel volume
bounces back relatively soon, airlines will
continue dropping more flights than they
add — and other travel segments will en-
dure the sorts of downsizings the airlines
began before the bottom dropped out.
The pain, it turns out, is similar, even if
the timing is not.
revIew
An ailing economy and volatile oil prices made 2008
a challenging year for the industry. But observers are
pinning their hopes for 2009 on emerging markets
and the winner of a historic presidential race.
BY BILL POLING PAGE 20
[ HIGH-END CRUISING FEELS THE PINCH ]
Recession forces luxury lines
to deal, innovate to fill cabins
By Johanna Jainchill
The luxury and upscale cruise sec-
tor is no stranger to struggle when
it comes to filling its ships. Between
2001 and 2003, the convergence of
the post-9/11 travel recession, the
invasion of Iraq and the bursting
of the technology bubble left many
upscale vessels half empty in vari-
ous parts of the world.
But by 2005, things had changed. The
housing boom was making many people feel
richer than ever before, stock portfolios were
at historic highs, and the luxury ships were
filled up.
By 2006, Seabourn Cruises had placed its
first new ship order ever, for three vessels. It
was soon followed by orders from Silversea
Cruises and upscale Oceania Cruises.
In 2007, a new luxury player announced
plans to enter the small-ship cruise mar-
ket: Pearl Seas Cruises, an offshore affiliate
of Guilford, Conn.-based American Cruise
Lines, placed an order for two ships of under
200 passengers each and said they would en-
ter service by June 2009.
But the outlook for high-end cruising
quickly changed as the economy went south.
The current recession has hit well-heeled
Americans harder — and frightened them
more — than any in recent years, as the Dow
Jones Industrial Average tumbled to five-year
lows, credit markets were paralyzed and the
See LUXURY on Page 36
settlement system to public charter opera-
tors, permitting agents to remit public char-
ter sales through the ARC reporting system
as if they were scheduled airline sales.
The first participating operator, Public-
Charters.com, has been working with ARC,
the GDSs and the U.S. Transportation De-
partment for several years to make the ar-
rangements possible. That effort has meant
complying with various technical require-
ments and DOT charter rules, according to
the company’s president, Jim Gallagher.
Gallagher told Travel Weekly that his com-
pany expected to roll out a schedule of com-
missionable public charter flights next year
that will be bookable and e-ticket-enabled
in the GDSs. He said that agents would be
able to report PublicCharters.com sales and
remit via ARC’s IAR, which will be an indus-
try first.
The company has been assigned the car-
rier code P1 and the accounting code 351.
To comply with the DOT’s charter escrow
rules, agents’ charter remittances to ARC will
be distributed to designated escrow banks
rather than to the transporting air carriers,
Gallagher said.
ARC said PublicCharters’ participation in
the settlement system would be effective Dec.
29, but Gallagher said he did not expect to
have inventory available until the middle of
next year.
PublicCharters, based in Avoca, Pa., near
See ARC on Page 37
NOTICE TO OUR READERS
On Dec. 31, Travel Weekly will publish a spe-
cial “Preview 2009” issue, offering a wide
variety of views about what lies ahead for
the industry in the coming year. Until we
return with our next regular issue on Jan. 5,
please visit www.travelweekly.com for break-
ing news about the travel industry. In the
meantime, the staff of Travel Weekly wishes
you a happy holiday season and a very pros-
perous new year.

tw_1222_1_1_20081218175016_738111 1 12/18/08 5:50:30 PM

 O N T H E C O V E R N E W S D E S T I N A T I O N S D E P A R T M E N T S

6 Carnival gains Mexico Update 6 News Briefs

The cruise company exceeded
expectations by raising its quar-
contents December 22-29, 2008
terly earnings from a year ago
8 Hertz seeks its fair share
Connect by Hertz, a car-sharing
business, debuts in New York,
London and Paris
14 ASAP gets an A-plus
ASTA, agents applaud Royal
Caribbean’s retailer initiative
16 Building block
Numbers indicate that hotel
guestroom development dropped
dramatically in November
24 Change in the air
Delta, for the first time, is tap-
ping a regional airline to operate
its New York-Washington shuttle
25 Splendid isolation in Baja
Developers break ground on new
resort project to debut in 2010 on
pristine plot east of Los Cabos
26 Karisma turns on charm
Boutique hotel chain woos agents,
promotes trade support efforts at
recent Riviera Maya conference
Luxury Travel
28 More for less
Loews Hotels rewards early book-
ing with discounts at most hotels
Ski Vacations
12 Mark Pestronk: Legal Briefs
Agencies not liable for refunds
when tour operators go under
16 TW Portfolio
I N S I D E R
4 In the Hot Seat
Sarah Klatt-Walsh of Swiss
International talks about raising
the bar on premium-class service
4 Travel Confidential
4 Friends & Colleagues
O P I N I O N

2008
20 37 Debit scarred
A Florida agent was hit with a
12 Arnie Weissmann:
From the Window Seat
Tempering hopefulness with

Year in Review $5,700 debit memo by United

An ailing economy and
volatile oil prices made 2008
a challenging year for the
industry. But observers are
pinning their hopes for 2009
on emerging markets
and the winner of a historic
presidential race.
By Bill Poling
38 Slow growth from China
U.S. tourism businesses that
were banking on a flood of new
Chinese visitors are still waiting
30 Aspen gets on board with bus
New luxury Gray Line service
connects Denver with ski resort
31 Best of both worlds
Luxury Steamboat Springs hotel,
the Highmark, combines condo
roominess, upscale hotel services
hard-edged business judgment
34 Editorials
34
34 Forum
Consultant Bob Adams’ Top 10
recommendations for marketing
during a recession
35 Richard Turen: Reality Check
An opportunity to get it right in
the year ahead

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03T1222.indd 3 12/15/08 12:09:44 PM

 INSIDER

IN THE HOT SEAT TRAVEL CONFIDENTIAL

W
Sarah Klatt-Walsh ord is that the Jan. 1 name change of the
Travel Industry Association to U.S. Travel
Swiss International Association is being celebrated a few blocks
As more business passengers either refrain being offered in the industry now, what away at the Telecommunications Industry
from flying or cut back on their premium- differences are you seeing in how pas- Association.
seat bookings, airlines such as Swiss Inter- sengers choose their flights or carriers?
national are looking at ways to keep top- A: Our customers are not as loyal as It ap- Salazar, who was named last week to be
class service while keeping a lid on costs. they used to be. They have become quite pears that secretary of the interior.
Chicago transplant Sarah Klatt-Walsh, product-savvy. And economy class is the travel
Swiss’ director of in-flight services, gave a very cost-sensitive. In this environment, TIA snared TC checked into the Club Med Punta
presentation on the topic to international that’s starting to play a more important the “tia.org” Cana in the Dominican Republic in
journalists in Zurich. Afterward she dis- role. We need to spend smartly. domain some years ago. The telecommu- mid-December and found a welcome
cussed with Travel Weekly aviation editor nications TIA has contented itself with note in the room, with instructions to
Michael Fabey how the airline is combin- Q: How do you do that? the more cumbersome “tiaonline.org.” call the front desk if anything was need-
ing the Japanese continuous-improvement A: We are adopting some of the meth- But now, the travel TIA has resigned ed. The note was signed “Santa.”
philosophy of kaizen (continuous improve- ods of the low-cost carriers: minimum itself to giving up its domain for some- The room was clean and fully sup-
ment) with a discount carrier’s bottom- ground time, minimum crew comple- thing along the lines of “USTravel. plied and TC needed nothing but, of
line mind-set. ment. org,” which would free up “tia.org” course, could not resist a phone call to
for the telecom crowd. But TC sees Mr. Claus. On the pretense that the iron
Q: What has been the impact of the Q: That seems almost like a contradic- a few dark horses in this game: The was not working, we called and asked for
economy on the makeup of the passen- tion in terms: to develop and improve Toy Industry Association has been a replacement and were told that Santa
ger mix on the aircraft? quality service while adopting camping out at the awkward “toy-tia would bring one in five minutes.
A: Switzerland is the land of some of the methods of the .org,” and the Transportation Interme- The knock on the door came in less
banks. We are seeing a shift low-cost carriers. How do you diaries Association, a group of logistics time than that. Would it be Jolly ol’ St.
to the back, especially with accomplish that? people, are at “tianet.org.” Nick himself in a red suit and a white
the banking sector. It’s not A: We keep on top of things. beard and trailing a herd of Rudolphs
enough for us to reconfigure I have three cabin crew mem- Sage Hospitality CEO Walter Isenberg, behind him?
the aircraft, as some others bers working in my depart- long a behind-the-scenes Democratic Nope. A diminutive, smiling Domini-
may be talking about. But it ment who fly part time. We political operative in Colorado, may soon can woman in a coral uniform stood at
is a challenge to us. We still are increasing efficiency while be juggling a campaign with his hotel the door, iron in one hand and a rum
feel the pressure. They still Sarah Klatt-Walsh decreasing ground time — business. Isenberg is being mentioned in punch in the other. Her name tag read
expect premium service. For and without hurting customer Denver political circles as a possible can- “Santa,” which TC later learned was a
the business class, it’s been a change in experience. We are saving money, but didate to succeed popular Denver Mayor fairly common first name on the island.
philosophy. we’re not putting that money someplace John Hickenlooper, who is on a shortlist “Buenas noches,” Santa said. “Merry
else. We are putting the money back into of possible replacements for Sen. Ken Christmas,” TC said.
Q: What other shifts are you seeing de- premium service.
velop as a result of the economic slow- We’re doing premium service in cre-
down, and what are you doing to com- ative ways, with things like welcome

(
Abrahamson named IHG Americas president
Friends & Colleagues

pensate? drinks and newspapers. We brought

A: The business class is becoming clos- in a Japanese consultant and adopted

Weekly deputy managing editor, at gbourbeau@travelweekly.com.

SUBMIT YOUR STORIES AND PHOTOS: Gerry Bourbeau, Travel
er to first class in a kaizen philos- InterContinental Hotels Group an-
terms of service. ophy. nounced the appointment of Jim
We need to be ‘Business class is becoming Abrahamson as president of its
able to deliver Q: How has that Americas region, effective Jan. 5.
more. With our
closer to first class in terms helped? Abrahamson will take over from
in-flight services, of service. We need to be A: With few flight Richard Solomons, who has served
we are looking to attendants we as interim president of the Ameri-
provide individual
able to deliver more.’ can still offer the cas and finance director since Ste-
presentations in same service. van Porter stepped down in July for
restaurant style. We now have 35 cater- We have developed innovative ways. For health reasons; Porter died in August.
ers around the world. The competition is example, we now have the ready-to-go Abrahamson joins IHG from Global Hyatt Corp., where he
continuously raising the “premium” bar. trolley. Everything the flight attendant served as head of development for the Americas. He has 30
needs is already on the trolley as pas- years’ management experience in hotel operations, branding,
Q: Are there any regions or markets you sengers board the plane. development and franchisee relations. Previous posts include
would identify as trendsetters for higher So the attendant has to spend less president and COO of Baymont Inns and Woodfield Suites
premium standards? time getting those trolleys ready and and senior vice president at Hilton Hotels Corp.
A: In the Middle East, in business class more time attending to the passengers. Solomons will return to his full-time role as group finance
they’re now starting to give out pajama We also have quick-clean meals so the director.
tops. passengers can sleep more.
Our differential is going to be in “soft- Virgin America Senior Vice Colin C. James has been ap-
Q: With all of the value-added services ware.” President and CFO Robert pointed CEO of the Antigua
B. Dana will step down in & Barbuda Tourism Author-
the first quarter of 2009 for ity. James formerly served as
NORTHSTAR TRAVEL MEDIA LLC ing new subscriptions, renewals, cancellations, changes personal reasons. Dana has CEO of Cable & Wireless in
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4 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_4_4_20081218172016_732814 4 12/18/08 5:20:31 PM

 World’s Largest Beach Ball
October 26, 2008

actual size 36 ft. in diameter

WE WANTED TO SHOW ACTUAL SIZE, BUT THAT WOULD

REQUIRE THE WORLD’S LARGEST MAGAZINE.
Travel agents across the globe, behold the Guinness World Record for The
Largest Beach Ball ever, set by Carnival Cruise Lines on October 26th in Dallas,
Texas. As if that weren’t enough, we then set the Guinness World Record for
The Largest Piñata ever on November 2nd in Philadelphia, Pennsylvania. More
proof that we’re always committed to gigantic, larger-than-life, bigger-than-big fun.
To see these Guinness World Records as they happened, visit BookCCL.com.
®

© 2008 Carnival Cruise Lines.

05T1222.indd 5 12/15/08 12:11:34 PM


BRIEFS
Continental to test
GPS at Newark
Continental is investing about $1.1
million to outfit 15 aircraft with
a satellite navigation system as
part of a test of new technology at
Newark Liberty Airport.
The system would enable aircraft
to fly closer together and land
more efficiently, said the Port Au-
thority of New York and New Jer-
sey. Satellite technology is a major
part of FAA plans for upgraded air
traffic control.
Taj in Mumbai sets
partial reopening
The Taj Mahal Palace & Tower ho-
tel in Mumbai, damaged in last
month’s terrorist attacks, was
slated to reopen its tower wing on
Dec. 21, offering 268 rooms, in-
The Taj was set to reopen its tower wing.
cluding nine suites. The landmark
hotel was also reopening its pool
lounge and several restaurants.
French hotel joins
Waldorf Collection
The 199-room Trianon Palace Ver-
sailles, within a mile of the famed
Chateau de Versailles outside of
Paris, will become a Waldorf-Asto-
ria Collection hotel in early 2009.
Travel operators
sentenced to prison
Two operators of tours for school-
children and religious pilgrims
were sentenced to 13 years in
prison in San Jose, Calif., after they
pleaded guilty to two felony counts.
Key among the 14 charges against
Joseph Maloof and Ron Hansen
were embezzlement and “failure to
provide travel or make refunds.”
They were accused of taking
more than $1.2 million from some
600 travelers. The pair jointly op-
erated as JM Travel Selections and
International Grand Tours in Cali-
fornia and ITS International Tours
in Louisiana.
6 D
tw_1222_6_6_20081218175116_732826 6
news
Carnival Corp. Q4 profit up 3.6%
By Johanna Jainchill
Carnival Corp. beat expectations with a $371
million fourth-quarter profit, besting its year-
ago performance and giving the travel
industry some welcome good news as
2008 draws to a close.
Lower fuel prices, stronger-than-
expected close-in bookings and high-
er ticket prices enabled Carnival to
achieve what its CEO, Micky Arison,
described as “a significant accomplish-
ment, considering the challenging en-
vironment.” Micky Arison
However, the world’s largest cruise CEO
Carnival Corp.
line was not as upbeat about its pros-
pects for 2009. It lowered its outlook,
citing a downward trend in both occupancy lev-
els and ticket prices.
Carnival realized a $31 million gain from the
sale of Cunard Line’s Queen Elizabeth 2, which
helped push its Q4 earnings up over last year’s
$358 million Q4 profit.
Arison said in a conference call with analysts
that the company was “hopeful for a reasonable
Wave period” in Q1 2009, when the cruise indus-
try typically sees the heaviest booking volume.
“But I must say, we are all cautious in our out-
look,” he said. “We all read the same papers and
see what’s going on.”
Carnival’s COO, Howard Frank, told analysts
that consumers were trading down in 2009,
RATE OUTPACES GDP CONTRACTION
Real travel spending dropped 8% in Q3
By Bill Poling
Travel and tourism could be in a steeper decline
than the economy as a whole.
Real travel spending, as measured by the Com-
merce Department, fell at an annual rate of 8% in
Q3, greater than the 0.5% contraction in U.S. gross
domestic product. It was the sharpest drop since
the quarter following 9/11.
The retreat was broad,
The Bureau of Economic
with negative growth for
air travel, accommodations, Analysis said air travel
related retail spending and
employment. spending dropped 20.4%.
The department’s Bureau
of Economic Analysis, in its quarterly update on
travel and tourism’s satellite accounts, said spend-
ing on air travel “led the downturn” with a 20.4%
drop in Q3, which came on the heels of an 18.7%
drop in Q2.
Accommodations spending, however, showed
the sharpest reversal, with a 3% decline in Q3 that
followed a 19.5% gain in Q2, a 22.5-point swing.
Travel-related shopping, including recreation
and entertainment, also swung to the negative, de-
clining 6.9% after a 4.7% rise in Q2.
According to this data, real tourism output as
measured by traveler spending in constant dollars
had increased for 12 out of the 13 previous calen-
dar quarters before the 8.1% decline.
E C E M B E R 2 2 - 2 9 , 2 0 0 8
which was benefitting its flagship Carnival Cruise
Lines brand but hurting its brands with longer,
more expensive cruises.
The company’s full-year profit fell 3.2%, to
$2.33 billion. A 12% spike in full-year
revenue was offset by a 55% increase in
fuel expenses, which cost the company
$626 million more this year than in
2007, and lower onboard spending.
Despite being cautious, Arison re-
minded analysts that Carnival Corp.
had historically performed well during
downturns.
“All during 2008, we had a lot of
skepticism in the market that we could
deliver the revenue in such a weak eco-
nomic environment,” he said. “And the
reality is, we did deliver. We’ve outperformed vir-
tually every area of leisure, and we believe we will
do it again in ’09.”
CARNIVAL CORP.
4Q ’08 4Q ’07 % Change
Revenue $3.3B $3.12B 5.7%
Net income $371M $358M 3.6%
2008 2007 % Change
Revenue $14.65B $13.03B 12.4%
Net income $2.33B $2.41B (3.2%)
Employment data, which lag by one quarter,
added to the bad news. The BEA said the latest
data show direct tourism employment fell 1.2% in
Q2, equivalent to the loss of about 25,000 jobs.
Those employment results included a 1.5% de-
cline in all transportation-related industries and
a 1.4% decline in accommodations. Employment
in food service, recreation and entertainment de-
clined by less than 1%.
When total direct and in-
direct spending is included,
however, the data look a bit
better. The BEA said total
travel-related spending in-
creased 1.6% in the quarter,
to $1.41 trillion. This total includes $797.8 billion
in direct spending by travelers and $613.6 billion
in economic activity to produce the goods and ser-
vices that travelers purchased.
Prices, meanwhile, continued to rise. The BEA
said prices for air transportation rose 13.6% in the
quarter, after rising 22.6% during the preceding
three months.
Accommodations prices rose 5% in Q3 after a
6.5% decline in Q2, when “many hotels offered
discounts to boost demand,” the BEA said.
The BEA report is based on government econom-
ic and employment statistics across different sectors
of the economy that are compiled to produce con-
sistent estimates of tourism-related activity.
W W W . T R A V E L W E E K L Y
BRIEFS
CWT buys agencies
in Ireland, Canada
Carlson Wagonlit Travel acquired
its Irish partner agency, Executive
Travel Group, a $50 million busi-
ness with locations in Dublin, Cork
and Limerick. It also acquired Ot-
tawa-based CWT Madison Travel,
a $14 million agency that was one
of 100 leisure agencies in CWT’s
franchise program in Canada.
San Francisco hikes
hotel tax on Jan. 1
San Francisco is boosting its ho-
tel tax on Jan. 1 to fund expansion
and renovation projects at the
Moscone Convention Center. The
current 14% rate will rise to 15%
or 15.5%, depending on a hotel’s
proximity to the convention center.
The tax increase was proposed by
the Convention & Visitors Bureau
and approved by 95% of the city’s
hotel owners and operators, said
the CVB.
Now in Manhattan:
Two Wyndhams
Wyndham opened its first two
Wyndham-branded hotels in Man-
hattan. The 224-room Wyndham
Garden Hotel Midtown Conven-
tion Center is on West 36th Street,
The Big Apple gets two Wyndham properties.
and the 124-room Wyndham Gar-
den Hotel Manhattan Chelsea
West is on West 24th Street.
New Zealand starts
price-fixing probe
New Zealand’s Commerce Com-
mission began court proceedings
against 13 airlines, alleging they
participated in “extensive and
long-term cartel activity in the air
cargo market” over seven years.
New Zealand is the latest coun-
try to investigate airlines for price-
fixing, following similar probes in
the U.S., the E.U. and elsewhere,
that have resulted in fines and le-
gal settlements.
. C O M
12/18/08 5:51:30 PM
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07T1222.indd 7 12/15/08 12:13:07 PM


Hertz heads into ZipCar’s territory with car-sharing service
By Nadine Godwin
Hertz launched a car-sharing busi-
ness last week with locations in
New York, London and Paris.
Within a year, said Mark Fris-
sora, Hertz chairman and CEO, the
company aims to add locations for
its club, called Connect by Hertz,
in another 20 cities in Europe and
North America.
The service is similar to ZipCar,
which appears to be the burgeon-
ing industry’s market leader in the
U.S. Car-share firms provide cars
for short-term use, hourly or daily,
at pickup and drop-off locations
such as transit hubs and other city
and suburban sites.
Frissora said there were about
20 car-sharing companies in the
U.S. with some 280,000 members.
He said there were another 60,000
car sharing participants in the U.K.
and 7,000 in France.
Worldwide, that total is 600,000
club members in 21 countries on
four continents, a $1 billion mar-
ket projected to grow to $10 billion
in five to 10 years, Frissora said. “And we
expect to be the share leader,” he added.
When asked to project growth in the U.S.
in the first year, Frissora said Hertz expect-
ed to sign on at least as many members as
the other car-sharing companies have now,
combined. Beyond that, he said, Hertz is
not making predictions because “we expect
a phenomenally fast growth.”
Lobby group prompts DOT to acknowledge flaws in airlines’ on-time data
By Michael Fabey
It appears airlines and others in the avia-
tion industry might have popped the cork
a little too early on a recent Transporta-
tion Department report showing only 50
tarmac delays in October, the first time the
DOT included such delays in its monthly
airline report card.
For the month, the 19 carriers reporting
on-time performance recorded an overall
on-time arrival rate of 86% for the month,
up from 78.2% for the same month last
year and 84.9% from September.
The DOT identified 50 flights that sat
on airport tarmacs for three hours or
more, out of 554,325 flights.
Now, though, the DOT says it can’t
vouch for those figures because the data
used to determine the delay count is cor-
rupted.
An analysis of the data by an outside
lobby group, which prompted the DOT ac-
knowledgment, indicates there were likely
more tarmac incidents than reported.
“Internally, we were missing a key data
check,” said Anne Suissa, the DOT’s direc-
tor of airline information.
“The checks and reviews of this data
were not as thorough as they should have
been. I can’t say the tarmac delay number
is correct.”
Suissa said the DOT failed to give air-
8 D E C E M B E R
tw_1222_8_8_20081218173116_736848 8
NEWS
He also said the Hertz cars would be the
most technologically advanced of any in
this market, with iPod connectivity, Blue-
tooth technology and a hands-free commu-
nications connection to a Hertz customer
care center 24/7. U.S. cars will have GPS
NeverLost technology, as well.
Additionally, Frissora said, Hertz aims
to have the most environmentally friendly
program in the market. The company said
lines clear instructions on how to report
the data.
“We recognize now there was a misun-
derstanding,” she said.
The DOT considers any time the plane
is on the ground for three or more hours
with passengers and doors closed to be a
reportable tarmac delay, Suissa said.
But some of the calculations that go into
figuring when those delays occurred are
much more complex, relying on airlines to
provide total time on ground, longest time
on ground and other similar data points.
Major discrepancies apparently exist in
those data points, calling into question the
overall tarmac delay calculation, Suissa ac-
knowledged.
Flyersrights.org, formerly the Coalition
for an Airline Passengers’ Bill of Rights,
alerted the DOT to the discrepancies.
“It looks like the airlines are just fill-
ing in numbers,” said Mark Mogel, Fly-
ersrights’ research director.
In reporting the analysis to the DOT,
Mogel highlighted one flight where an
aircraft was stuck at an airport for three
hours and 48 minutes but was reported to
be “on the ground” for only four minutes.
“It appears to me that a great deal of
the data, possibly a majority, is incorrect,”
Mogel said.
Suissa said the airlines apparently were
confused about what information the
2 2 - 2 9 , 2 0 0 8
All Connect by Hertz cars
are EPA SmartWay-certified,
said Hertz Chairman and CEO
its showcase car in the U.S. was the Toyota
Prius, which is most valuable in stop-and-
go city driving, where the vehicle often op-
erates solely on its electric motor.
All Connect by Hertz cars in the U.S. are
EPA SmartWay-certified, and those in Eu-
rope surpass the voluntary target set by the
E.U. for reduced fuel emissions, Hertz said.
Frissora said that as currently marketed
and implemented, there was no obvious
DOT wanted. The numbers, she agreed,
simply don’t add up.
To make matters worse, she said, the data
were not properly vetted by the agency.
“There has been a culture of just getting
the data out instead of getting it right,”
Suissa said. “Now, we have a renewed fo-
cus on data quality.”
She said the DOT was working on a fix
AIRLINES’ OCT. REPORTED ON-TIME PERCENTAGES
Carrier
Northwest Airlines
Southwest Airlines
Frontier Airlines
US Airways
JetBlue Airways
United Airlines
AirTran Airways
Alaska Airlines
American Airlines
Delta Air Lines
Continental Airlines
Overall
Source: Department of Transportation
W W W . T R A V E L W E E K L Y
role for travel agents in Connect by
Hertz, but he said he thought that
would change when Hertz was ready
Mark Frissora. to market the club to corporations.
In announcing the club, Frissora
emphasized that the program was
another step in Hertz’s sustainabili-
ty efforts. The club makes cars avail-
able conveniently and cost-effec-
tively, he said, for drivers’ everyday
needs and hence reduces the need
for personal cars or for multiple cars
in a single household. The effect, he
said, will be fewer cars on the roads
and savings for consumers.
Consumers will join online, book
online and use smartchip-enabled
Connect cards to open and start
their cars.
In the U.S., the annual member-
ship fee is $50, and the least costly
car, the Toyota Prius, is $10 an hour
or $70 for 24 hours plus 45 cents
per mile after the first 180 miles.
These prices, roughly the same as
ZipCar’s rates, include fuel, insur-
ance and roadside assistance.
Warren Miller, a stock analyst
for the Morningstar Fund, said the
Hertz move into car sharing “won’t move
the needle yet” for Hertz but nonetheless
was a smart move.
“Anything Hertz can do to improve op-
erations is very important.” And if Dollar
Thrifty and Avis Budget “can scrounge up
the money to invest,” they will probably
shift a piece of their business into car shar-
ing, too, Miller said.
it can send to the airlines to better explain
the information it needs reported.
In the meantime, the DOT says, the
Bureau of Transportation Statistics, the
government agency that collected and dis-
seminated the data, is posting a disclaimer
on its website that some of the tarmac
delay data may have been misreported by
some airlines.
Number of airports Percentage on time
83 90%
64 89.6%
39 89.1%
79 87.5%
43 86.7%
75 86.3%
56 84.6%
45 84.4%
75 83.6%
93 81.6%
56 81.4%
86%
. C O M
12/18/08 5:31:31 PM
 SAVE $400
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09T1222.indd 9 12/15/08 12:14:21 PM

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1011T1222.indd 11 12/15/08 12:33:23 PM

 opinion
A hard-edged holiday tale
W
hen Morton Meyer was an intelligence officer sta-
tioned in France shortly after World War II, he spent
much of his free time visiting small inns that, he dis-
covered, served great food. After he returned stateside
and opened a travel agency in St. Louis, he stayed in
touch with many of the inn owners.
In 1954, several of them banded together to create
the organization that was to become Relais & Chateaux.
Meyer, meanwhile, built up his agency Today Danny Meyer is, by many stan-
and, along the way, became the first Ameri- dards, the most successful restaurateur
can representative of Relais & Chateaux, in Manhattan, having opened the Union
helping to establish the brand here. But in Square Cafe, the Gramercy Tavern, 11 Mad-
the late ’60s, he became overambitious in ison Park and the Modern, among other es-
his agency expansion plans, and when the tablishments highly rated for both cuisine
economy took a wrong turn, the business and atmosphere. I met him recently at an
collapsed. event celebrating 11 Madison Park’s ac-
Over the following years, he started sev- ceptance into Relais & Chateaux, bringing
eral travel-related enterprises. He opened things for his family and R&C full circle.
a hotel; it didn’t survive. He then packaged There are many themes in Morton’s and
and sold group tours. This
thrived for many years, but
it, too, eventually went un-
der. Then another hotel.
FROM THE WINDOW SEAT
His son, Danny, went
to college in Rome and worked for him as Danny’s stories that seem to have relevance
a tour escort there. Although Danny took a to current economic conditions. The first
degree in political science and flirted with is about businesses that fail during hard
the idea of entering politics, there was a lot times. Failed-business owners who still have
of his father in him, and he was drawn to enthusiasm for life pick themselves up, dust
the links between food and hospitality. themselves off and jump back into the in-
LEGAL BRIEFS
Agencies not liable for defunct tour operators’ debts to clients
Mark Pestronk is a Washington-based law- By “tour operators,” I mean the entire
yer specializing in travel law. gamut of operators that retail agencies
deal with, including wholesalers, con-
Q:
After 9/11, lots of tour operators solidators, public charter operators, land
and even a few cruise lines went operators and package sellers, as well as
out of business after canceling all sellers of escorted tours. All these busi-
future trips and failing to make refunds. nesses are inherently risky, as they require
Our agency sells a lot of cruises and tours. the operator to assume inventory of some
Under what circumstances could we be li- kind.
able for our clients’ losses? What can we The basic principle
start doing now to protect our clients’ of law is that agen-
money and prevent us from being held cies and their agents
liable? are not liable for the
defaults of opera-
A:
I expect that many tour operators tors, including their
will go out of business in the next failure to operate or
year. make refunds.
Many of them will spend all their money The same is true
before shutting down, leaving nothing for in every principal/
refunds. agency relationship,
On the other hand, the cruise industry including those in real estate and insur-
is much more concentrated than it was in ance.
2001, and it is unlikely that those compa- In all such relationships, as long as the
nies will collapse. Therefore, I would not agency discloses the identity of the prin-
worry about the cruise lines as much as cipal (i.e., the operator) before the sale is
the tour operators. closed, the agency cannot be held liable
12 D E C E M B E R 2 2 - 2 9 , 2 0 0 8
tw_1222_12_12_20081218133516_73212 12
dustry they love. If they’re smart, they don’t
duplicate their first failure exactly.
But even though Morton Meyer had an
outsized impact on those around him, from
the founders of Relais & Chateaux to his
clients and family, his businesses were not
particularly successful financially. It’s al-
ways a mistake, however, simply
to judge a man’s life through the
narrow measure of business acu-
men. Danny recalls his father as
“my childhood hero: a hedonist,
a gastronome and a man who
passionately savored life.”
And Morton’s vision was, in
fact, ultimately realized, spec-
tacularly, through the lessons he Arnie Weissmann
imparted to his son. Editor in Chief
Even so, after the success of
Danny’s first restaurant, he was temporar-
ily paralyzed by the fear that he had also
inherited his father’s inability to expand
businesses successfully, and it took years for
him to get up the nerve to open a second
restaurant.
At the recent Relais & Chateaux event,
Danny spoke metaphorically about hospi-
tality and bad economic times.
“It’s like really bad weather,” he said. “You
can talk and talk and talk about it. You can
stay in your house, where it seems safe, and
try to wait it out. But in reality, you can’t do
that for very long. Fear of going out does
for anything the principal does or fails to
do. To the extent that a judge holds the
agency liable anyway, the judge is making
a legal mistake that can be overturned on
appeal.
So the first thing you need to do is to
be sure to disclose the identity of the tour
operator at the time you make the sale.
Add the name to the itinerary that you
produce and send
to the client, and
Disclose the make clear that the
named operator is
identity of the providing the ser-
tour operator
vice.
Even better, add
at the time you the name to the
make the sale. bottom of a signed
disclaimer that says
you are not liable
for the operator’s acts or omissions. This
step is especially important when you use
a consolidator, as clients often have no
idea that such a middleman is involved.
Agencies, of course, are liable for their
own negligence or breaches of contract.
W W W . T R A V E L W E E K L Y
not help you. You need to put on your hat
and take your umbrella and go.
“The root word in hospitality is ‘hope,’”
he continued. “Those in travel and hospi-
tality can have a positive impact on the way
people feel when they do venture out. We
can give hope. In good times, luxury made
people feel good. But what is luxury today?
It isn’t extravagance. It’s simply the quality
of how you spend your time. And you don’t
need to wait until the storm is over to spend
time well.”
I thought about Danny Meyer’s
words and his family’s business
history when, the next morning,
I met Jeremy Palmer of Tauck to
hear about Culturious. It’s a new
brand the family-owned company
is launching that’s aimed at boom-
ers who want to “stretch their
minds and stretch their legs.”
“We are not launching into the
best environment; we know that,”
Palmer said. “But we bring a long-
term perspective to this. And it doesn’t hurt
to launch this when others are weak.”
Well, maybe that last statement doesn’t
sound as warm and fuzzy as the end of my
holiday column should. But the reality is that
these times call for a blend of hopefulness
and hard-edged business judgment. Morton
Meyer had the hopefulness. But if you don’t
have the latter when times get tough, you, too,
may have to wait — perhaps for a generation
— to see your ideas find full expression.
Email Arnie Weissmann at aweissmann@
travelweekly.com.
For example, it would be negligent not to
warn a client of the potential insolvency
of an operator when articles about its pos-
sible financial problems have appeared in
the trade press.
Therefore, be sure to stay informed and
tell clients what you have read. Converse-
ly, if nothing about the now-defunct op-
erator appeared in the trade press before
you sold the trip, it follows that you can-
not be successfully sued for negligence for
failing to disclose an operator’s financial
problems.
Although aggressive plaintiffs’ lawyers
might allege you have a duty to investigate
the finances of each and every supplier
you recommend or sell, such an assertion
is ridiculous, and there are no precedents
to that effect, anyway.
In my next column, I will cover other
steps you can take to prevent liability for
operator defaults.
To submit a question for Legal Briefs,
email Mark Pestronk at mark@pestronk
.com.
. C O M
12/18/08 1:35:23 PM
 Imagine you’ve
created the
highest rated
casino resort
in the world.

What do you do
for an encore?

13T1222.indd 13 12/15/08 12:19:05 PM


Premium service still a priority for Swiss Int’l
By Michael Fabey
ZURICH — With aviation industry ana-
lysts continuing to predict a deep downturn
in air passenger counts in the coming year
as the recession takes its toll on business
travel, airlines are taking steps
to protect their bottom line. Sarah Klatt-Walsh is
Transatlantic air carriers like In the Hot Seat, Page 4
Swiss International, which fo-
cus on premium service and traditionally
carry a large clientele from the financial
sector, face a particularly challenging time.
Some analysts have predicted airlines
would realign the seating on aircraft, to
take room out of first class or business class
and move it to the back, creating something
akin to an elite economy class.
Sarah Klatt-Walsh, Swiss director of in-
ASTA, others hail RCCL’s move to raise commissions
flight services, doesn’t think it will come to
that, at least for Swiss. “We are seeing a shift
to the back,” she said, but the trend has not
been pronounced enough for the airline to
rethink its overall strategy.
But the airline is thinking and planning
tactically. It is trying to keep the premium
and business customers it has by ratcheting
up that service while trimming costs “and
without hurting customer experience,”
Klatt-Walsh said.
For example, the carrier can reduce the
14 D E C E M B E R
tw_1222_14_14_20081218135017_73214 14
NEWS
number of attendants per flight without
diminishing service to business- and first-
class passengers waiting for takeoff by us-
ing “ready-to-go trolleys,” which are already
stocked with what the attendants need.
“Quality is a prime consideration for the
Swiss,” said Rolf Jetzer, Swiss
International board chairman.
The airline wants a brand
that matches its own country’s
renowned hospitality, said Markus Binkert,
head of airline products and services.
“We want to go that extra mile and offer
that personal treatment,” he said. “These are
Travel agents and the organizations that
represent them publicly expressed appre-
ciation for the Agent Support Action Pro-
gram, Royal Caribbean Cruises Ltd.’s new
initiative to raise commissions and increase
co-op funding.
“The ASAP, in conjunction with the re-
cent elimination of fuel surcharges, are
steps that help our industry at a time when
we are all hurting,” said Chris Russo, ASTA
president and chair, in an open letter to
ASTA members. “Actions such as those un-
2 2 - 2 9 , 2 0 0 8
elements you cannot copy and paste from
one airline to another.”
While Swiss is a “boutique airline,”
Binkert said, it still can distinguish itself as
a premium service carrier. “Because we are
a small airline, we keep that product devel-
opment very central,” he said.
So the airline is creating a business class
that resembles a first class, Klatt-Walsh said.
Swiss is paying particular care to its food
service.
The airline’s main caterer, in Zurich, is
Gate Gourmet.
“Fine dining is alive and kicking in this
dertaken by RCCL not only reaffirm the
commitment between agents and the cruise
lines but will boost the travel and cruise in-
dustry at a time when we need it most.”
RCCL’s three North American brands said
they would implement the ASAP initiatives
through the upcoming Wave period, Jan.
1 through Feb. 28, in order to help agents
through the current economic crisis.
Vacation.com CEO Steve Tracas, who
noted that travel agents distribute almost
80% of RCCL’s product, said , “RCCL’s
W W W . T R A V E L W E E K L Y
industry,” said Mike Pooley, Gate Gourmet
vice president of innovation.
But Gate Gourmet realizes that a cater-
er has to be more than just a food-service
company for an airline, said Philippe op de
Beck, the company’s senior vice president
for Europe. It has to be a logistics partner.
“Since 9/11, food products have turned
into a main element of the supply chain for
the airlines,” he said. “If we’re late one min-
ute, an aircraft might miss its slot, passen-
gers might miss their connection.”
And that certainly would run counter to
the Swiss mind-set, rooted as it is in clock-
work efficiency.
As chairman Jetzer put it, “We associate
tradition with reliability, consistency and
performance.”
leadership role in recognizing and address-
ing these challenges is certainly a step in
the right direction. … RCCL is navigating
the same challenging economy as all other
cruise lines, but they understand the im-
portance of a healthy and vibrant distribu-
tion channel over the long term.”
Dwain Wall, senior vice president and
general manager of CruiseOne and Cruises
Inc., called the program “just the sort of
thing we need to help survive a challenging
economy.”
. C O M
12/18/08 1:50:22 PM
 Encore.

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15T1222.indd 15 12/15/08 12:20:08 PM

 MONEY
TRAVEL WEEKLY WORK ON 93,219 GUESTROOMS STALLED IN NOV.
PORTFOLIO
SYMBOL COMPANY NAME VALUE
12/17/08
VALUE
12/17/07
%
CHANGE
More U.S. hotel rooms out of pipeline
AC.PA Accor $34.63 $54.00 -35.9 By Jeri Clausing In addition to the number of projects being canceled or
AFLYY.PK Air France-KLM $14.17 $33.14 -57.2 delayed, the industry is preparing for an increase in finan-
The number of hotel guestrooms falling out of the U.S. cial trouble among hotel owners.
AAI AirTran Holdings $4.00 $7.82 -48.8 construction pipeline was up 75% last month, and industry In response, PKF Capital has launched the Distressed Ho-
ALK Alaska Air Group $27.27 $25.08 8.7 experts expect the trend to continue. tel Solutions Program to help advise hotel owners who be-
AXP American Express Co. $19.81 $51.31 -61.4 November figures from Smith Travel Research show came overleveraged with debt during the recent easy credit
93,219 guestrooms have been abandoned in various stages years and are now faced with declining revenues and repay-
ASCA Ameristar Casinos $9.30 $27.17 -65.8 of development, from preplanning ment due dates on the horizon.
AMIE Ambassadors International $0.86 $12.17 -92.9 to those already under construction.
That figure compares with 53,332
‘Given the current state of Bob Eaton, PKF Capital’s execu-
tive managing director, said the in-
AMR AMR Corp. $10.09 $15.97 -36.8
CAR Avis Budget Group $0.68 $13.55 -95.0
that fell out of the pipeline in No- the economy, these numbers dustry was just entering the down
vember 2007 and is 8,729 higher cycle.
BYD Boyd Gaming $4.85 $34.56 -86.0 than the number abandoned in Oc-
aren’t surprising.’ “It hasn’t really started yet,” he
BAY.L British Airways $172.00 $302.50 -43.1 tober 2008, Smith said. — Jan Freitag, Smith Travel Research said. “We are on the front end of
“Given the current state of the whatever it is going to be.”
CCL Carnival Corp. $23.47 $42.72 -45.1 economy and the nonexistence of new-construction lend- But forecasts for next year are increasingly gloomy.
CHH Choice Hotels International $28.23 $32.95 -14.3 ing, these numbers aren’t surprising,” said Jan Freitag, “Our original forecast of RevPAR [revenue per available
CAL Continental Airlines $16.04 $23.05 -30.4 Smith’s vice president of global development. room] decline done in September for 2009 was negative-
“We believe that we will continue to see this high level of 3.2%. Quickly deteriorating conditions lead us to revise
DAL Delta Air Lines $11.00 $14.53 -24.3 abandonment through at least the first half of 2009. Until the downward slide projected for 2009 to be negative-4.3%
DIS The Walt Disney Co. $23.58 $32.50 -27.4 new funding for new and existing projects is made available RevPAR decline. In December we announced our quarterly
DTG Dollar Thrifty $1.11 $23.27 -95.2 by lenders, there is little reason to believe that the rate of forecast for RevPAR for 2009, and the forecast is now nega-
abandonment will slow.” tive-7.8%,” Eaton said.
EXPE Expedia $8.51 $32.68 -74.0 The total active pipeline for the U.S. through November “Most hotels will weather this financial storm, but a sig-
GET Gaylord Entertainment Co. $12.33 $38.47 -67.9 has 631,680 guestrooms, including 191,807 that are already nificant number of owners and their lenders are faced with
HA Hawaiian Airlines $4.66 $5.06 -7.9 under construction, Smith said. The pipeline is 6.7% higher deteriorating circumstances.”
than it was in November 2007, while the number of rooms The new program will offer help with debt refinancing,
HTZ Hertz Global Holdings $3.46 $15.23 -77.3 under construction is 6.8% lower. asset sales, bankruptcy and management issues.
IHG InterContinental Hotels Group $8.87 $17.85 -50.3
JBLU JetBlue Airways Corp. $6.04 $6.89 -12.3
LVS
MGM
Las Vegas Sands Corp.
MGM Mirage
$7.50
$13.85
$115.39
$83.49
-93.5
-83.4
Air Jamaica CEO: Deadline to go private ‘realistic’
MAR Marriott International $18.21 $32.09 -43.3
By Gay Nagle Myers rier’s on-time record and generate higher passenger loads.
OWW Orbitz Worldwide $4.14 $9.52 -56.5 Air Jamaica’s sales pitch keys in on the carrier’s position
PCLN Priceline.com $70.31 $109.31 -35.7 NEW YORK — Jamaica’s government hopes to complete in the aviation market in Jamaica.
RLH Red Lion Hotels $2.75 $9.97 -72.4 the transfer of majority ownership and management con- “The carrier is the leader with a total market share of
trol of Air Jamaica by March 31, the end of the current fis- 44%, [comprising] 50% of all Jamaican passengers and
RJET Republic Airways Holdings $10.19 $19.18 -46.9 cal year, said airline CEO Bruce Nobles. 31% of all visitors,” Nobles said.
RCL Royal Caribbean $11.71 $40.15 -70.8 “The date is realistic, although we have a contingency “Air Jamaica currently flies to 17 destinations; has 14 air-
RYAAY Ryanair Holdings $30.20 $37.42 -19.3 strategy in place in case the goal isn’t met,” Nobles said. craft; 2,200 employees; and a loyal, emotional base among
Some progress already is evident. Air Jamaica the Jamaican diaspora that is very important to
LUV Southwest Airlines $8.27 $12.81 -35.4 completed 98% of its scheduled flights in No- us,” Nobles said. “No decisions on new routes,
0678.HK Star Cruises $0.63 $2.32 -72.8 vember, the “highest level of completion in many aircraft and destinations will be made until we
HOT Starwood Hotels & Resorts $18.53 $45.00 -58.8 months,” Nobles said. know who the new owner is.”
Close to 70% of the flights arrived on schedule, Until that time, according to Nobles, “we are
TZOO Travelzoo $6.21 $14.46 -57.1 as well, also an improvement. trying to balance the need to be profitable with
TRXI TRX $0.55 $1.10 -50.0 “We can’t do anything unless and until we get the realities of the current economic situation.
LCC US Airways Group $7.37 $14.76 -50.1
this airline on time,” he said. Holiday bookings are down 10% right now, and
The Air Jamaica brand will remain in place fol- we expect overall first-quarter business to be off
MTN Vail Resorts $24.26 $46.10 -47.4 lowing the divestment, according to Nobles. Bruce Nobles by as much as 15%.”
WYN Wyndham Worldwide $6.78 $24.81 -72.7 The goals of privatization are clear, he said: CEO Although the government wants to sell a ma-
maintain the Air Jamaica brand name; provide Air Jamaica jority control of the carrier, it could still retain a
WYNN Wynn Resorts $47.59 $114.26 -58.3
adequate airlift for the island; and select an owner minority interest, Nobles said.
CUMULATIVE $734.01 $1,594.61 -54.0 with extensive airline experience and appropriate capital. The carrier’s projected losses of $200 million this year
Nobles, who served as Air Jamaica’s president and COO on top of its $170 million loss in 2007 prompted the gov-
CUMULATIVE (NOT INCLUDING AIRLINES) $412.71 $1,076.40 -61.7 from June 2002 to March 2003, was brought back in No- ernment to set the March deadline to rid itself of the cash-
vember to oversee the divestment process, improve the car- bleeding airline.

R E S E A R C H MGM Mirage to sell Treasure Island to Ruffin for $775M

Business travel volume MGM Mirage is raising cash by selling its Treasure Island MGM Mirage has been pumping cash into its $9.2 billion
(in person-trips and percent change) Hotel & Casino in Las Vegas to billionaire Phil Ruffin for CityCenter development, set to open in late 2009.
While the short-term outlook for U.S. business travel volume is chilly, a warming trend will $775 million. The sale of Treasure Island is expected to close by the end
begin late next year. Positive increases are forecasted for business travel in both 2010 and Ruffin, who sold his New Frontier Hotel and Casino in of Q2 2009. MGM Mirage said it anticipated reporting a
2011. All numbers are forecasted. Las Vegas last year for $1.24 billion, has agreed to pay $500 “substantial” gain on the sale.
2008 461.2 million N/A million in cash and $275 million in secured notes. The Ruffin sold the New Frontier Hotel and Casino to Elad
notes, to be issued by Ruffin’s acquiring company, will be Properties in 2007. The property has been razed and is now
2009 445.3 million (-3.5%) secured by the assets of Treasure Island. the site of a stalled hotel-casino project, the Plaza Las Vegas.
2010 452.7 million 1.7% The property is located on the Las Vegas Strip and has Ruffin’s hotel group owns and operates hotels under the
2,885 guestrooms and approximately 90,000 square feet of Marriott, Courtyard by Marriott and Fairfield Inn brands
2011 458.6 million 1.3% gaming space. in six U.S. states.
Source: Travel Industry Association

16 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_16_16_20081218140416_73216 16 12/18/08 2:04:31 PM

17T1222.indd 17 12/16/08 2:32:26 PM
 One of the
8ORLDS
'INEST 3ESTAURANTS
Just Arrived
in Stockholm
We invite you to be deliciously indulged
in a dining experience as diverse as
the 180 global destinations to which
we travel. With culinary masterpieces
created by master chef Jacques Pépin,
the dining is only rivaled by the sublime,
personal service and the refined yet
relaxed ambiance that ensures your
ultimate comfort.

This is a distinctly different style of

cruising. This is Oceania Cruises.

Finest cuisine at sea, served in four

distinctive open-seating restaurants

Gourmet culinary program

created by world-renowned
master chef, Jacques Pépin

Elegant mid-size ships featuring

large-ship amenities

The world’s most alluring

and desirable ports

Country club-casual ambiance;

tuxedos and gowns are never required

Butler Service offered in Owner’s,

Vista and Penthouse Suites

Best value in luxury cruising

<
%52/0%s3/54(!-%2)#!s#!2)""%!.s!3)!s!5342!,)!
/2$%2"2/#(52%3 !.$"//+/.,).% !4 (440!'%.4/#%!.)!#25)3%3#/-
/2 #!,,  

1819T1222.indd 18 12/15/08 12:21:23 PM

 'REE
"IRFARE AND UP TO  4AVINGS
Scandinavian Splendors
34/#+(/,-4/,/.$/.s $!96/9!'%!"/!2$2%'!44!
3!),$!4%3*5.%*5,9!5'5343%04%-"%2

Classic voyages such as this garner praise year after year. It’s no wonder. The destinations are
predominately a blend of capital cities, beginning with striking Stockholm, where you will spend an
enchanted evening, followed by Estonia’s historic Tallinn. Still, the highlight is three days and two
nights in St. Petersburg, a treasure-trove of priceless art in museums like the Hermitage and architectural
gems that include St. Nicholas Cathedral and Yusupov Palace, where Rasputin was killed. You will also
enjoy the delightful capitals of Helsinki, beautiful Copenhagen, and Amsterdam, with its surprisingly
rich Jewish heritage on display in the Anne Frank House and Portuguese Synagogue. In Zeebrugge, be
sure to sample the sensational Belgian chocolates, much of it hand-sculpted.

STOCKHOLM overnights4!,,)..s340%4%23"52' 3 dayss(%,3).+)s'$!.3+

#/0%.(!'%.s"%2,).s+)%,#!.!,s!-34%2$!-s"25'%3s,/.$/.

%!2,9"//+).'&!2%3 &2/-
$4,599*
PER GUEST WITH FREE AIRFARE

Scenic Splendors & Gilded Palaces

2/-%4/34/#+(/,-s $!96/9!'%!"/!2$2%'!44!
3!),$!4%-!9

Our lengthiest voyage into Northern Europe stretches from the heart of the Mediterranean into the deep-
blue Baltic, visiting a dozen spectacular countries along the way. The initial highlights include Cadiz,
gateway to Spain’s flamenco-loving Seville, and lively Oporto, where you might shop in the medieval quarter
of Ribeira. Farther north, more cosmopolitan ports await you, including the capital cities of Amsterdam,
its Van Gogh Museum is a must-see, and easy-to-walk Copenhagen. The voyage builds to a wonderful
crescendo with two, unforgettable overnight stays. The first evening will be spent in St. Petersburg, the
amazing city built by visionary Peter the Great just over 300 years ago. Enjoy another evening in Stockholm,
Sweden’s environmentally friendly capital spread across an archipelago of 14 islands.

2/-%s-!(/.s3%6),,%s,)3"/.s/0/24/s3!).4 -!,/s"25'%3
!-34%2$!-s+)%,#!.!,42!.3)4s#/0%.(!'%.s'$!.3+
340%4%23"52' overnights4!,,)..s34/#+(/,- overnight

2 FOR 1 FARES FROM

$4,999
PER GUEST WITH FREE AIRFARE

*Offer expires March 31, 2009. Fares listed are cruise only in U.S. dollars, per person, based on double occupancy and include Non-Commissionable Fares. Government Fees and Taxes of up to $8 per guest per day are additional. Cruise Ship Fuel Surcharge may apply. All fares and offers
are subject to availability, may not be combinable with other offers, are capacity controlled and may be withdrawn at any time without prior notice. 2 for 1 fares are based on published Full Brochure Fares; all fares are cruise only, and do not include Prepaid Charges, Optional Facilities and
Services Fees, and personal charges, as defined in the Terms and Conditions of the Guest Ticket Contract which may be viewed at www.OceaniaCruises.com. Full Brochure Fares may not have resulted in actual sales in all cabin categories and may not have been in effect during the last 90 days.
Promotional fares may remain in effect after the expiration date. Air promotion applies to economy, round-trip flights only from select Oceania Cruises U.S. & Canadian gateways and does not include ground transfers, air taxes and air fuel surcharges. Air ticketing fee will apply. Free Airfare is
available only from the following Oceania Cruises Primary Air Gateways: ATL, BOS, ORD, DFW, DEN, IAH, LAX, MIA, JFK, EWR, MCO, PHL, PHX, SAN, SFO, SEA, TPA, YYZ, YVR, IAD. Airfare is available from all other U.S. & Canadian gateways at an additional charge. Oceania Cruises reserves the
right to correct errors or omissions and to change any and all fares, fees, and surcharges at any time. The Cruise Ship Fuel Surcharge is additional revenue to Oceania Cruises. Additional terms and conditions may apply. Complete terms and conditions may be found in the Guest Ticket Contract.
Ships’ Registry: Marshall Islands. DEC0808

1819T1222.indd 19 12/15/08 12:21:25 PM

 Year
2008

in
revIew
An ailing economy and volatile oil prices made 2008 a challenging year
for the industry. But observers are pinning their hopes for 2009 on
emerging markets and the winner of a historic presidential race.
By Bill Poling
e didn’t know it for sure until the year was mostly over, but
2008 was, above all else, a year of recession.
Of course, 2008 will go into political history as the year
we elected Barack Obama, but in the realms of business
and economics, it will be remembered as the year of the
credit crunch and bailout (and bailout and …). A year
marked by crazy swings in stock prices and equally crazy
swings in the price of fuel. A year when the travel industry
started off strong and coasted into park.
If we’re lucky, historians will mark it as the “2008-2009 recession.” That’s the hope,
but the economic news for most of the year was so bad that some pessimists say this
baby’s last name is more likely to be “2010.”
By whatever name, it merits the No. 1 spot in our annual review of the top issues of
the year because it got everybody’s attention. It got us by the purse strings.

20 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_20_23_20081217131339_73520 20 12/17/08 1:13:55 PM

 The economy
In the beginning, 2008 didn’t look too bad. With the
exception of the airlines, most travel industry segments
had ended 2007 on fairly strong notes and had reasonable
grounds for cautious optimism for the new year.
There were concerns about a credit squeeze stemming
from the subprime mortgage crisis, but it didn’t seem to
be affecting the rest of the economy. The stock market was
sliding toward Bearsville, but other economic indicators
were hanging in there, and travel demand seemed to be
holding up.
Corporations and vacationers were still booking travel,
and the weak dollar was bringing loads of foreign visitors
to U.S. destinations.
But the bad news started piling up as the year progressed.
Big lodging projects got put on hold; cruise prices started to
go soft; Aloha went bankrupt and stopped flying; Ambas-
sadors International decided to get out of the river cruise
business; and people began to fear that fuel prices would
push airfares too high too fast, putting a damper on travel.
By midyear, fuel prices were at an all-time high, airlines
were scrambling for revenue and cutting back capacity and
there was no question about bears on Wall Street.
The scope of the carnage became clear in the second half
W W W . T R A V E L W E E K L Y
tw_1222_20_23_20081217131339_73521 21
of the year when the Wall Street titans started falling and
the government had to rescue the insurance giant AIG,
then the banks. As of this writing, the auto industry was
next in line, and by some estimates, the running tab for the
government’s various bailouts, loans, takeovers and rescues
will be well into the trillions.
Cruel fuel
The story of fuel in 2008 is nothing short of startling.
According to the government’s Energy Information
Administration, the weighted average global spot price of
crude oil doubled in the space of one year to more than
$137 per barrel at the beginning of July, and then, in the
span of five months, sank to less than a third of that, reach-
ing a new four-year low. Cruise lines began the year adding
surcharges; now they’re scraping them off like barnacles.
This kind of volatility signals what Obi-Wan Kenobi
might describe as a disturbance in the Force.
The world’s airlines have endured all manner of slings
and arrows in recent decades, from revolutions in govern-
ment regulatory policy to strikes, storms, terrorism, conges-
tion, recession, militant workers, militant environmentalists
and militant passengers. But nothing has scared them more
than the prospect of oil going north of $140 a barrel.
. C O M D E C E M B E R
At that price, airline managers discovered last summer
that a lot of what they had been doing simply could not
be done. Certain routes could no longer be flown. At that
price, the survival of their companies and the viability of
their industry became serious talking points.
As the economic news worsened in the fourth quarter,
airline people became strangely euphoric — not because
they like recessions, but because oil prices were dropping
back into familiar territory. Given a choice between a re-
cession and $140 oil, airlines will take the recession every
time.
Now they’re cutting capacity at a furious rate and are
managing to stay with the falling demand curve, which is
keeping load factors up. Thus, even as the overall outlook
for 2009 deteriorates, the U.S. airline capacity cuts trig-
gered by cruel fuel could be positioning them to eke out
some profits next near.
Obama elected
Barack Obama campaigned on the theme of change, and
he has already begun to change one thing just by getting
elected: the image of the U.S. in foreign countries.
Writing in the Washington Post shortly after the elec-
See REVIEW on Page 22
2 2 - 2 9 , 2 0 0 8 21
12/17/08 1:13:56 PM
 2008
REVIEW
Continued from Page 21
tion, Nobel laureate Desmond Tutu, archbishop emeritus of
Cape Town, South Africa, observed, “The election of Barack
Obama has turned America’s image on its head,” reversing
the negative images painted by Abu Ghraib and other per-
ceived excesses of the war on terror.
The election was celebrated around the world as a sign
that the unilateralism of the Bush Doctrine was giving way
to a new era of international
cooperation, not just on strate-
gic and security matters but on
a range of other issues, includ-
ing the environment.
One frequent traveler, return-
ing from Europe, summed it up
this way: “The world loves the
U.S. again.”
And to the extent that height-
ened U.S. security and border
control practices had served as a deterrent to foreign visi-
tors, travel people in the U.S. are now anticipating a more
welcoming atmosphere that will be good for business.
The change comes at a time when the industry will need
all the help it can get: At year’s end, even with the improved
public image, the Travel Industry Association was warn-
ing that global economic conditions could produce a 3%
decline in foreign visitors and a consequent reduction in
tourism’s contribution to the balance of trade.
Indirectly, the agenda of the incoming administration of-
fers hope to the travel business by virtue of its commitment
to reinvigorate the economy and stimulate job growth.
More directly, it also offers the prospect of infrastructure
investment that could enhance travel by air, road and rail.
A la carte air travel
A la carte pricing has been around since airlines started
charging for drinks and headsets back in the Stone Age. It
made a few inroads during the distribution wars when car-
riers starting charging extra for handling reservations over
the phone. But in 2008, the practice of unbundling made so
many inroads that there may be no roads out.
United, by some measures the most aggressive unbundler
out there, began the year by implementing a $25 fee for a
second checked bag. It ended the year by selling access to
Comic relief: Milt Priggee’s best from 2008
Within the confines of a rectangular box on the editorial page every week, Travel Weekly cartoonist Milt
Priggee offers a perspective on the news that can make us think, laugh, grumble and maybe even save us
from ourselves. As 2008 comes to a close, we offer one last chance to pause and reflect on some of Priggee’s
greatest hits.
June 9
22 D E C E M B E R 2 2 - 2 9 ,
tw_1222_20_23_20081217131339_73522 22
priority security lines for $25 and up.
In between, United and other carriers have set fees for
snacks, meals, the first checked bag, the second checked bag,
curbside check-in and preferred seating; several carriers also
have raised fees for services such as carrying pets or trans-
porting unaccompanied minors.
The flurry of activity gave rise to a hot debate about
whether consumers prefer to pay only for the services they
use or will balk at the nickel-and-dime approach. South-
west, in keeping with its tradition of simplicity, adopted
“No hidden fees” as its tag line and has apparently
been scoring points on the public-relations front for
its forthright approach.
But the real test is whether it works for the bottom
line, and a growing number of analysts have said un-
bundling is, overall, a revenue enhancer, which prob-
ably means it’s here to stay.
As the year drew to a close, Sabre offered some re-
lief from the element of surprise that annoys many
passengers at the airport: an “attribute shopping”
tool, to be rolled out in 2009, that will enable users to
compare the total cost of competing flights, with and with-
out the various add-ons.
“You want baggage with that?”
The travel lobby
It might not have been a winning year for travel, but trav-
el was a big winner in Washington in 2008, and the stage is
being set for continued progress toward travel-friendly poli-
cies in the new administration.
After strenuous and effective lobbying by the Travel In-
dustry Association and other groups, the House passed the
Travel Promotion Act at the end of Sep-
tember. Although the Senate hasn’t yet fol-
lowed suit, the TIA chalked it up as a huge
victory and remains optimistic that the
bill will soon become law.
The centerpiece of the bill is the cre-
ation of a fund that would be used to
educate foreign visitors about U.S. entry
and border control policies and to promote the U.S. as a
travel destination in overseas markets.
The industry got another dose of good news in Novem-
ber when the Visa Waiver Program was expanded by the
addition of seven more countries, bringing the total to 34.
Among the seven is South Korea, which is expected to pro-
Oct. 20
Jan. 28
2 0 0 8 W W W . T R A V E L W E E K L Y
duce a big influx of visitors in the next few years.
For the TIA, soon to become the U.S. Travel Association,
these are good omens that, coupled with President-elect
Obama’s positive impact on world opinion, could give in-
ternational travel a real boost.
But airlines and other industry segments are still bogged
down in the details of Uncle Sam’s numerous and some-
times overlapping border security and entry practices, with
a hodgepodge of confusing names such as the Western
Hemisphere Travel Initiative, Secure Flight, U.S. Visit, Trips,
APIS and others.
The TIA’s challenge going forward is to communicate
the need for better coordination of these programs so they
work more effectively for government, industry and travel-
ers, and it regards the Travel Promotion Act as a cornerstone
of that effort.
Airlines: The makeover continues
If the big airline story this year was the rise and fall of fuel
prices, the runner-up has to be the beginning of structural
change in transatlantic markets. The Open Skies agreement
between the U.S. and the European Union opened London’s
Heathrow to all U.S. carriers and created opportunities for
European airlines to serve the U.S. from any point in Eu-
rope rather than just from their homelands.
The agreement also paved the way for European carriers
to merge with each other without losing their U.S. landing
rights. That enabled British Airways to court Iberia, Luf-
thansa to acquire control of Britain’s BMI and everyone to
woo Alitalia.
The emergence of a “common market” for transatlan-
tic air travel also creates an environment conducive to the
growth of alliances, nowhere better illustrated than in the
evolution of SkyTeam.
Delta’s acquisition of Northwest cre-
ated the foundation for an extensive,
four-brand international joint ven-
ture with the Air France/KLM system.
That prospect, in turn, spurred British
Airways and American to strengthen
their Oneworld alliance with a renewed
effort to obtain antitrust immunity. BA’s recent talk of a
merger with Qantas is also, in part, an alliance play as the
big groupings continue to jostle for global traffic shares.
The supersizing of alliances at the top end of the spec-
trum, however, is being offset at the other end by an ever-
July 21
. C O M
12/17/08 1:14:09 PM
 increasing pressure on small carriers in the U.S. and else-
where. Aloha’s disappearance was not an isolated failure.
Frontier is also in Chapter 11, and Southwest has broken its
old mold by venturing into international partnerships with
airlines in Canada and Mexico.
Air traffic control
We heard more about airport slots in 2008 than we ever
thought possible, as the airlines engaged in a hot and heavy
debate with a lame-duck Transportation Department about
how to manage congestion and alleviate delays, particularly
at New York’s three major airports.
The DOT wanted to raise funds for congestion relief by
withdrawing takeoff and landing slots from incumbent air-
lines at the three airports and auctioning them off.
In theory, it was a plan that might have done some good,
but the DOT utterly failed to lay the necessary political or
legal groundwork for the move.
The airlines, the Port Authority of New York and New
Jersey and aviation leaders in Congress weighed in against it
with every weapon at their disposal. Finally, the U.S. Court
of Appeals put an end to it, for now, granting the industry’s
request for a stay. The plan isn’t dead, but the Obama ad-
ministration is likely to pull the plug on it in favor of Plan B
— as soon as someone comes up with a Plan B.
But the great slot debate of 2008 was merely the flare-up
of a much broader smoldering issue, and it’s not just about
New York. The standoff over slots marked the latest in a
long line of government-industry stalemates over airport
capacity and air traffic control issues. There’s a general con-
sensus that the industry has to move to a more automated
system built on GPS technology, but there is no consensus
on how to pay for it.
The recession and airline capacity cuts have given poli-
cymakers some breathing room, but not much. When air
travel resumes its inexorable upward trend, the nation is go-
ing to need new infrastructure to handle it because the old
one, with or without auctions, can’t.
Green gains momentum
Every business needs a cash strategy, a marketing strategy,
a tax strategy, a what-to-do-in-a-flood strategy. Now each
also needs a green strategy. It seems that every trade associa-
tion from ASTA to the TIA spent a portion of 2008 advising
members on what it means to be green.
The plethora of best-practice checklists, however, has
March 17
May 19
W W W . T R A V E L W E E K L Y
2023T1222.indd 23
muddied the waters about what is really green and what is
really a sustainable practice, at least in the eyes of billionaire
world-fixer Ted Turner.
After 15 months of working with a coalition called
the Global Partnership for Sustainable Tourism Criteria,
Turner’s United Nations Foundation this year unveiled
the improbable: a global tourism agreement built on 40
criteria by which claims of “sustainable tourism” can be
measured.
Assuming that Turner’s group succeeds in getting travel
businesses to agree on benchmarking and measurement
guidelines, the industry will have something that organic
farmers wish they had: definitions developed by practitio-
ners rather than by government regulators.
There remains considerable uncertainty about whether
consumers are as green in their spending habits as they are
in public opinion polls. And while many travel companies
were getting on the bandwagon this year, it remains to be
seen if the recession will knock them off.
But the green movement is marching to a long-term
drummer. In the most challenged segment of the industry,
air transportation, carriers have begun the first tentative
demonstration flights with biofuels.
Everybody knows it will be years before economics and
public opinion make biofuels a reality, but nobody is bet-
ting against it.
A China bubble?
Remember the Olympics? It went
on for two weeks last summer, show-
casing not only the world’s athletic
talent but the beauty and brass of
China, the world’s most populous
country, the one with the Energizer
Bunny economy.
The consensus view seems to be that China put on a good
show and created millions, maybe billions, of favorable im-
pressions around the globe. Coupled with a new U.S.-China
tourism Memorandum of Understanding and increasing
U.S. hotel industry investment in China, the table seemed
to be set for a feast.
But a payoff in increased travel might have to wait.
Even before the economic news in 2008 went from bad
to worse, U.S. airlines read the signs and throttled back on
what would have been an ambitious and aggressive buildup
of capacity on U.S.-China routes.
Aug. 25
. C O M D E C E M B E R
In 2007, the Transportation Department, anticipating
a big surge in demand, opened six new U.S.-China air-
line routes for U.S. carriers, with the expectation that they
would become operational in 2008 and 2009, producing a
60% increase in departures.
Delta succeeded in launching its Atlanta-Shanghai route,
but the other carriers put their new China routes in the ice-
box and notified the DOT that they could not begin service
until 2010 at the earliest.
China, meanwhile, began to demonstrate that it is not
recession-proof after all, as the government told its airlines
to throttle back on their ambitious aircraft purchases and
to consider grounding some aircraft to cope with declining
demand.
Down the river
It’s not often that a travel company (or any company)
publicly declares: This isn’t working; it was a mistake for us
to get into this business; we’re shutting it down; we’re get-
ting out.
But that essentially is what the parent company of Majes-
tic America Line declared this year, and its decision pretty
much shuts down overnight riverboat cruising in the U.S.
The company stopped taking bookings for 2009.
After several previous owners of the old Delta Queen
had struggled with
the riverboat business,
Ambassadors Inter-
national had reached
across the country
over the pre v ious
few years, gathering
the major overnight
paddle wheelers under
one brand. After that
acquisition binge, however, the enterprise never seemed to
develop a full head of steam.
For the Delta Queen herself, 2008 was likely to be a fare-
well year anyway because the vessel was losing its congres-
sional dispensation from fire safety laws, but it turned out
to be a farewell year for the whole fleet.
At year’s end, Ambassadors’ efforts to sell the Majestic
America division had come to naught, and the individual
assets were understood to be for sale. But with a deepening
recession looming, the future of this niche market is … well,
around the bend.
Sept. 1
2 2 - 2 9 , 2 0 0 8 23
12/17/08 1:48:46 PM

Regional carrier will operate Delta’s New York-D.C. shuttle
By Michael Fabey
Delta for the first time is handing over part
of its hourly New York-Washington shut-
tle service to a regional airline in January
and will eventually replace its own MD-88
flights with 76-seat regional jet service to
be operated by Shuttle America.
While Delta has occasionally used its
own regional jets on the shuttle routes,
carrier officials said this marks the first
time the airline will contract with a re-
gional airline partner in the East Coast
shuttle market.
Delta currently uses MD-88s for all but
two of its Delta Shuttle flights, with the oth-
er two using Embraer E-175s.
Delta plans to switch to an
entire Shuttle America fleet
of 76-seat Embraer E-175s
by March 28.
MD-88s offer 142 seats in a two-class
configuration. The Embraer aircraft offers
76 seats with 12 in first class, two fewer than
the MD-88.
But Delta officials said the 175s are not
traditional regional jets: It’s easier to stand
up straight in the cabin, and the seats are
about an inch wider.
The Delta shuttle service will split even-
ly between the two aircraft starting Jan. 5,
tw_1222_24_24_20081217163339_73224 24
NEWS
with plans to switch to an entire Shuttle
America fleet of E-175s by March 28.
Shuttle America is one of the three re-
gional airline subsidiaries of Republic Air-
ways Holdings; the other two are Chautau-
qua Airlines and Republic Airlines.
Shuttle America applied this month to
the Transportation Department to remove a
restriction that allows the carrier to operate
scheduled passenger service with large air-
craft only as a contractor in a fee-for-service
agreements with larger U.S. carriers.
Without the restriction, Shuttle America
would be free to offer scheduled service
in domestic markets under its own brand
name, and the carrier told the DOT said
Delta seeks 3 Tokyo routes as it continues Asia push
Although Delta has yet to merge its opera-
tions with Northwest, it is leveraging the
two route systems to gain an even greater
presence in Asian markets, one of North-
west’s traditional strongholds.
The carrier applied to the Transportation
Department to operate daily nonstops on
three new routes to Tokyo from Portland,
Ore.; Guam; and Honolulu. The routes
would start about June 1, although some
of the services could be transitioned as
early as March.
“This will better enable the two carriers
to align capacity with demand,” Delta said
Starting Jan. 5, Delta’s New York-D.C. shuttle flights will
be split evenly between E-175s, pictured, and MD-88s.
there is no sound regulatory reason for the
restriction.
The airline said it has substantial finan-
in the DOT filing.
Delta will operate 221-seat Boeing 767-
300ER aircraft, replacing the 243-seat Air-
bus A-330-200 aircraft currently operated
by Northwest.
“Northwest may remain a marketing car-
rier on some or all of the routes” under a
codeshare, Delta said.
The move continues Delta’s aggressive
push into international markets, with par-
ticular focus on Asia. The carrier has been
planning to increase its international ca-
pacity by up to 15% by year’s end.
“We almost doubled our size in trans-
cial resources and an experienced manage-
ment team and should have the flexibility
to respond to new market opportunities.
Also, Shuttle America noted that the
DOT recently removed a similar restriction
on its affiliate, Republic Airlines.
Delta is also introducing paid WiFi con-
nections in the shuttle market this month
with the Aircell in-flight Internet service
GoGo.
The airline said passengers would be able
to surf the Internet for about 40 minutes
during the flight.
The service is priced at $9.95 for flights
of three hours or less and $12.95 for longer
flights.
pacific,” Glen Hauenstein, executive vice
president of network and revenue manage-
ment, told analysts in the fall. “We have
seen a very durable growth in Asia.”
Delta had tried to make Portland an
Asian hub in the 1980s and ’90s but later
moved those transpacific services to other
gateways.
Now the airline is hoping the popular
Northwest brand in Asian markets will
provide the proper entree.
Delta also plans new flights to Tokyo
from Atlanta, Salt Lake City and New
York. — M.F.
12/17/08 4:33:53 PM
 DE
ST
‘It’s in the heart of the best fishing and snorkeling in all of Baja.’ — Gary Jacobs, Cabo Riviera IN AT
IO NS
Seclusion a key selling point for Cabo Riviera
By Laura Del Rosso

C
onstruction started this fall on Cabo Riviera, a 900-acre re-
sort and residential community on a five-mile strip of white-
sand beach east of Los Cabos in Baja California.
Plans calls for two luxury hotels; a Mediterranean-style vil-
lage with shops, restaurants, dozens of private homes and con-
dominiums; a Pete Dye-designed golf course; and a 285-slip marina.

The setting is the East Cape of the Baja
peninsula along the Sea of Cortes, about a
45-minute drive from Los Cabos Airport.
“The market is demanding a pristine and
secluded luxury project on the Sea of Cor-
tes at Los Cabos, and we are responding,”
said Gary Jacobs, one of Cabo Riviera’s in-
vestment partners.
The setting is ideal for a low-density
luxury resort because of its white-sand
beaches, calm waters and fishing and boat-
ing opportunities, he said.
“This is a stretch of five miles of white-
sand beaches where the waters are safe
for swimming, unlike the waters at Cabo,
where swimming is dangerous about 90%
of the time because of the choppy waters of
The group is not releasing the cost of
their investment in the project.
This fall, sales of private home lots and
construction of the first phase of the ma-
rina was started. Work on a five-star, beach-
front hotel is expected to begin in the sec-
ond quarter of 2009.
Jacobs said he and his partners have
signed a letter of intent with a luxury
hotel company but could not yet release A rendering of the hotel and central shopping plaza of the planned Cabo Riviera development in Los Cabos.
its name.
In addition to the 150-room hotel, the imity to the U.S. and because the beauty of has long drawn fishermen, but growth has
company will manage 200 adjacent resi- the area makes it a draw to fishermen and been hampered because of a lack of marina
dences, all on 40 acres of beachfront land at boaters. facilities, which required that charter and
the corner of the north jetty of the marina. The area is considered one of the top private fishing boats had to be moored off
The master plan also calls for a second sportfishing destinations in the world and shore.
phase of construction that will include a

M EU PXD AIT EC O
the Pacific Ocean,” said Jacobs. four-star hotel and 11 man-made islands

▼
The East Cape area is sparsely populat- lined with private villas, each with their
ed, attracting sportfishermen, snorkelers own private dock for personal watercraft. A
and windsurfers. “It’s in the heart of the total of 1,600 homes and hotel rooms are
best fishing and snorkeling in all of Baja,” planned.
he said. Jacobs said that despite the economic
There is a small town, La Ribera, “a fish- downturn, the investors see a great deal of
erman’s village that is much like what Cabo long-term potential in the Cabo area for a
was in 1971,” said Jacobs, a banker who said high-end development because of its prox-
he first saw the potential of Cabo tourism
in the early 1970s, before there were paved
roads, electricity or a commercial airport.
Developers want to retain the small-
town, low-key atmosphere.
The planned community will feature a
marina village with residences and com-
mercial buildings built along narrow,
cobblestone walkways with archways and
an “Old World” atmosphere of St. Tropez,
Portofino and St. Bart’s, he said.
The development is a joint venture
among several partners, including Grumar
S.A., a Mexico City-based company headed
by Mariano Mariscal, who developed high-
end projects in Los Cabos and several other
Mexican beach resorts. The U.S.-based
partners include Jacobs, Hank Sames, Ben
Barnes and James Sharp.

ONE BRAND.
When you can’t remember what day it is, INFINITE POSSIBILITIES
you know it’s a perfect Barceló vacation.

If you could go on vacation right now, what would your perfect vacation be?
Romantic dinners by the sea. Relaxing in a spectacular, state-of-the-art suite with
breathtaking views of tropical gardens at one of our many hotels in Mexico. Perhaps
sharing exciting adventures with the whole family. Whatever your dream vacation may be,
Barceló Hotels & Resorts will make it come true. With an unmatched dedication and
world-class service that will surpass even your greatest expectations, every day you’re here.

Investors say the undeveloped Cabo Riviera site, pictured,

R I V I E RA M AYA CANCUN P U E RT O V A L L A RTA LO S C A B O S I X TA PA H U AT U L C O M A N Z A N I L LO
is ideal for a low-density luxury resort.

W W W . T R A V E L W E E K L Y . C O M D E C E M B E R 2 2 - 2 9 , 2 0 0 8 25

tw_1222_25_25_20081217134839_73325 25 12/17/08 1:48:52 PM

 ‘You have to find a niche and create an opportunity for yourself.’— Mandy Chomat, Karisma
Karisma conference honors agents, unveils marketing tools
By Mario Correa
CANCUN — Nearly 200 travel agents de-
scended upon Karisma Hotel & Resorts’ El
Dorado Royale property outside Cancun
26 D E C E M B E R
tw_1222_26_26_20081217124739_73326 26
this month for the first gathering of partici-
pants in the company’s Gourmet Inclusive
Vacation Consultants program.
The sales and marketing event featured
agents from across North America join-
2 2 - 2 9 , 2 0 0 8
ing company executives in asserting their
determination to persevere through tough
economic times.
The three-day event, of which Travel
Weekly was a co-sponsor, was held from
W W W . T R A V E L W E E K L Y
Dec. 3 to 6 and centered on Karisma’s re-
cently launched GIVC initiative. The pro-
gram provides aggressive marketing and re-
lated support for members who consistently
sell Karisma’s six all-inclusive properties,
which operate under
the El Dorado and
Azul brands on Mex-
ico’s Riviera Maya.
Roughly 500 agents
have joined the pro-
gram, which carries
a membership fee
of $250. Member-
Mandy Chomat
ship will be capped
Vice President of
Sales and Marketing at 1,000, according to
Karisma company officials.
An awards ban-
quet recognized Karisma’s top-performing
agencies, while sales and marketing sessions
served to buck up agents’ spirits regarding
the economy.
“There’s a lot of good news out there,”
said Mandy Chomat, Karisma’s vice presi-
dent of sales and marketing, citing the fast-
dropping price of oil. He stressed the im-
portance of agents’ marketing creatively in
times of recession and pointed to surveys
predicting that Americans would continue
to travel. Chomat told the 197 agents in at-
tendance that “71% of active travelers plan
to take a trip in the next six months.”
“You have to find a niche and create an
opportunity for yourself,” he said.
Chomat, a former top executive at San-
dals, and Amy Dang, Karisma’s director of
marketing, announced a series of “turn-key”
marketing tools aimed at helping agents cre-
ate such opportunities. For example, agents’
Karisma site visits will be videotaped and
posted on YouTube so they can be shown
to clients. (The company’s newest “gourmet
all-inclusive” property, the 438-room Azul
Sensatori, opened last month.)
MEXICO
▼
UPDATE
“These people are agents; they are not
designers, they are not Web decoders,” said
Dang in describing agents’ marketing needs.
“They need materials, they need websites,
they need direct mail.”
Dang’s pitch resonated with attendees
like Laurie Johnson, an owner and agent at
Owatonna, Minn.-based Cedar Travel.
Johnson described her own less-than-
successful independent marketing effort,
when she sought last year to create a spa va-
cation display in her storefront window.
“We put our mannequin on the table, like
she was on a massage table, put a turban
on her head like they do [during] a mas-
sage and put a sheet over her,” said Johnson.
“She looked like she was a getting a mas-
sage, or so we thought. But we got a lot of
people stopping by the window and asking
if she was in a morgue or dead or what!”
Visit www.karismahotels.com.
. C O M
12/17/08 12:47:51 PM
 PLEASE DO NOT DISTURB

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notice. Not combinable with other promotions.

27T1222.indd 27 12/15/08 12:22:39 PM

 Brunch at rooftop restaurant L’Astral has long been a must for locals.

Early-booking promotion eases luxe pinch at Loews

global distribution, in a statement. “People
who book ahead get the best deals.”
Bon voyage
The 29-story Le Concorde is a towering,
latter-day skyscraper of a landmark just
outside the walls of historical Quebec City’s
Old Town, a scenic quarter noted more for
17th and 18th century colonial French and
British architecture.
Its award-winning, revolving rooftop
restaurant, L’Astral, continues to draw local
and visiting gourmands, treating them to
a 360-degree view of Quebec and the Lau-
rentian Mountains in a 90-minute circuit.
The eatery is headed by chef Jean-Claude
Crouzet. The L’Astral brunch has long been
a must for locals each Sunday; reserve cli-
ents a seat far in advance, as well.
Other culinary options lie a stone’s throw
away, as Le Concorde sits atop Cap-Dia-
mant between the famed Plains of Abra-
ham and Grande-Allee, Quebec City’s main
Loews Le Concorde, towering just outside Quebec City’s historical walls, is offering discounts of up to 20% on stays. dining and partying thoroughfare.
Each of the 206 guestrooms and 19 suites
boast river views and have been updated,
along with the lobby and L’Astral, in a $3.6
million renovation this year that lent them
a chic, boutique feel. Two suites feature
mezzanines, fireplaces, saunas and whirl-
pools.
“We are now offering a supremely com-
fortable and vibrant experience with a
uniquely local flavor,” said Paule Riverin, di-
rector of marketing at Loews Le Concorde.
“Loews Le Concorde Hotel continues to be
a leader in the four-star Quebec City down-
town hotels, offering magnificent views of
the St. Lawrence River [and] Old Quebec.”
Purchasing powers
Advance-purchase reservations must be
paid at the time of booking, are nonrefund-
able and cannot be changed. The discount
also cannot be combined with other pro-
motional offers or rates and is not available
at the three Loews Hotels at Universal Or-
lando Resort.

By Kenneth Kiesnoski
ROOM KEY

L
oews Hotels is making luxury more affordable in hard eco-
nomic times with new advance-purchase discounts of up to LOEWS LE CONCORDE
ADDRESS: 1225 cours du General De Mont-
20% on stays at most of its 17 upmarket properties across calm, Quebec City, Canada G1R 4W6
North America, including the Loews Le Concorde in sightse- RESERVATIONS: (800) 463-5256
er’s delight Quebec City. TELEPHONE: (418) 647-2222
FAX: (418) 647-4710
The “Advance Purchase” discount, either vance entitle guests to 20% off the best WEB: www.loewshotels.com
10% or 20% depending on booking win- available rate; reservations made 30 to EMAIL: loewsleconcorde@loewshotels.com
dow, applies to business or leisure stays in 59 days ahead of check-in get a 10% dis- ROOMS/SUITES: 406/19
all room categories, including Web-exclu- count. FACILITIES: Two restaurants, bars; gym;
sive rates from Loewshotels.com. “It’s similar to buying airfare,” said An- heated pool; business center
Bookings made 60 days or more in ad- thony Del Gaudio, Loews’ vice president of AMENITIES: High-speed Web access; A recently renovated guestroom at Loews Le Concorde.
three phones; oversized desk; Bloom

L U TXR A VUE LR Y
toiletries; Sony PlayStation console and
games; iron/board; coffeemaker; daily paper, turndown.
▼

REVIEW: Loews Le Concorde challenges the nearby Fairmont Le Chateau Frontenac for
primacy in the Quebec luxury hotel stakes. Just off bar- and restaurant-lined Grande-Allee,
it’s less grand but hipper and more youthful, with views that include the castle-like com-
petition. Renovated guestrooms are modern, comfortable. Staff is friendly, professional.

Greenway a boon to InterContinental Boston

By Felicity Long
For a city steeped in history, Boston is
changing at warp speed, with the dramatic
renaissance of its waterfront district. Restau-
rants, hotels and historical neighborhoods
are benefiting from the recent upgrades to
this part of the city, and none more so than
the posh InterContinental Boston.
The 424-room luxury property, which
opened at the end of 2006 to much fanfare,
also offers 130 high-end residences, several
gourmet eateries and one of the hippest lo-
cations in Beantown.
Part of the excitement swirling around
the hotel is its key position along the Rose
Kennedy Greenway, which opened officially
in October. The Greenway is a mile-long,
15-acre series of public gardens, parks and
walkways on land reclaimed during the
high-profile Central Artery Project. Known
locally as the Big Dig, the project sub-
merged a traffic-choked highway and made
spectacular use of that repurposed acreage.
One of the results is the Greenway, which
runs from Chinatown to the North End,
meandering through Quincy Market, the
Waterfront and the Financial District.
Not only will the parks offer public
spaces for theater, music and dance perfor-
mances year-round, but the scenic walk-
ways serve to link parts of the city that were
formerly bisected by a busy highway and
difficult to access by pedestrians.
Now no longer cut off from the rest of
downtown, the $315 million InterContinen-
tal Boston overlooks the harbor on one side,
complete with a two-acre waterfront garden
and promenade along Boston’s Fort Point
Channel, and the Greenway on the other.
The chic, contemporary look of the
property, with its all-glass exterior designed
to resemble the tall ships that have plied the
harbor for centuries, is a departure from
the more staid, businesslike hotels in the
neighboring Financial District.
Guestrooms and suites feature a sleek
decor, along with WiFi and other high-tech
amenities, and guests can take advantage of
direct water taxi service to Boston Logan
Airport from the hotel’s private dock.
Guests who brave driving Boston’s
crooked, often narrow streets can take ad-
vantage of valet parking, after which they
can bring their blood pressure back down
at the 6,600-square-foot Spa InterConti-
nental, complete with a 24-hour fitness
club and heated, indoor lap pool.
The property also features 32,000 square
feet of meetings space that can accommo-
date up to 1,200 in the Rose Kennedy Ball-
room and the Abigail Adams Ballroom.
The InterContinental Boston offers sev-
eral eateries, including Miel, a Provencale-
style brasserie inspired by two-Michelin-
star Jacques Chibois.
Guests also can dine at Sushi-Teq, which,
as its name implies, specializes in sushi and
high-end tequila served to salsa music, and
RumBa, a rum and champagne bar.
Rates start at just over $200 a night.
Visit www.intercontinentalboston.com.

28 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_28_28_20081217125139_73328 28 12/17/08 12:51:53 PM

 NEW ROOMS.
ENOUGH TO ENTICE
ANYONE TO TURN
IN EARLY.
Book your clients into our newly remodeled rooms.

They’ll appreciate new amenities such as 42” LCD TVs,

Sealy® beds with Pacific Coast® down comforters and pillows,
plush robes, media hubs and iHome® docks for mp3 players.
All surrounded by warm woods, natural tones and sophisticated
design. And all just steps away from our fabulous restaurants,
exciting nightlife at The Beatles™ REVOLUTION Lounge and
JET, and The Beatles™ LOVE™ by Cirque du Soleil®.

REDESIGNED. REVAMPED. REMIXED.

For room reservations, call 866 250 2436 or 702 791 7444 • Fax 702 791 7446
For more information, visit mirage.com • GDS Code: MV

29T1222.indd 29 12/15/08 12:28:27 PM

 This season, the Base Village will open more than 90 ski-in/ski-out condos, the first to be built in Snowmass in 20 years.

Gray Line offers airport service to Aspen/Snowmass

By Felicity Long

M
uch as I enjoy skiing in Colorado, I have probably logged
nearly as many hours cooling my heels at the Denver air-
port as I have on the slopes.
Mind you, when there are no delays, the system works
very well, with flights to nearby resorts often taking less
than an hour. During snowstorms, however, air travel is often delayed by
the very weather that draws visitors to the region in the first place. Skiers and snowboarders enjoying early winter snowfall at
Aspen/Snowmass have new travel and dining options.
Once, after sitting with a group of in- This season, clients bound for Aspen/
creasingly cranky passengers for more than Snowmass have another alternative. The to be built in Snowmass in 20 years.
four hours, we concocted the idea of rent- resort, which comprises Snowmass, Aspen Also new this season is Sneaky’s Tav-
ing a van and making the drive to the resort Mountain, Aspen Highlands and Butter- ern near the Village Express lift for casual
ourselves. Then we remembered the blan- milk, has teamed up with Gray Line to pro- American bistro cuisine, and the 7,800-
kets of snow piling up on the mountain vide the first luxury ground transportation square-foot Sam’s Smokehouse restaurant
roads and thought better of it. service to its four mountains. at the top of the Village Express lift. Sam’s
Set to operate year-round, the scheduled, makes the most of its location with floor-

SKI
nonstop service includes VIP check-in at
Gray Line’s concierge facility at the airport
and guaranteed window or aisle seating.
And for late arrivals, the service features
a night coach, with six departures each eve-
▼
to-ceiling windows looking out over Gar-
ret’s Peak and Mount Daly as well as out-
door seating and a barbecue menu.
The Capitol Peak Conference Center
opened this season with more than 8,000

ning during the peak ski season. Supple-
mental service from Eagle County Regional
Airport and the Aspen/Pitkin County Air-
port to the resorts also is available.
New and improved
The big news at Snowmass continues to
be the $1 billion Base Village project being
developed by Related WestPac and compris-
square feet of conference space in Capitol
Peak Lodge at the base village.
On-mountain improvements at Snow-
mass, to the tune of some $7 million, in-
clude the new Sheer Bliss chairlift that
serves 700 acres of challenging terrain in
the Big Burn area. The lift takes just over
nine minutes to carry up to 2,000 people
per hour up 2,212 vertical feet.

VACATIONS
ing lodging, upscale restaurants and apres
ski venues. This season, the village will open
more than 90 ski-in/ski-out condos, the first
All this expansion comes on the heels
of three years of improvements priced at
about $50 million and including the Village
Express six-pack lift, new gondolas, a new
terrain park and the Elk Camp Meadows
learning area.
Last year, improvements in the new

Everything your client needs Snowmass base village included the Tree-
house Kids’ Adventure Center and Four-
Mountain Sports rental/retail shop.
for the perfect vacation! Still to come are the Little Nell Residences
at Snowmass, the Viceroy Resort Residences
at Snowmass and more than 300 condos, as
Earn commission on lodging, lift tickets, well as a community aquatic center and
more shopping and dining outlets, all due
ski/snowboard rentals, ground transportation, to be completed next year.
travel insurance, airfare and more.
Peaks performance
Choose from more than 80 resorts and Meanwhile, the other three mountains at
Aspen/Snowmass have seen improvements
1,500 properties in North America, of their own.
Aspen Highlands added about 18 acres of
Europe and South America. terrain this year for skiers and snowboard-
ers called Canopy Cruiser and situated be-
Call 800.262.8434 today to book the , tween Hyde Park and Mushroom Chutes.
mountain vacation of a lifetime for your client. nts Buttermilk, which hosts the ESPN Win-

lage om ter X Games through 2010, unveiled an

ve i.c
Olympic-size, 22-foot half-pipe for high-
tra Sk s. adrenaline skiers and riders, while Aspen

m/ from gent
Mountain opened a new gondola plaza in
o downtown Aspen, designed to ease the pas-
i.c e a
sk urc avel
senger loading process.
. Overall, 476 beds will come online this
wwwreso r tr season in Aspen/Snowmass, including
o
isit new st f Hayden and Capitol Peak Lodges in Snow-
mass and the newly rebuilt Limelight Lodge
V a ju
in downtown Aspen.
Visit www.aspensnowmass.com.

30 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_30_30_20081217124239_73330 30 12/17/08 12:42:53 PM

 The units are decorated in a Western style inspired by designer Ralph Lauren.

Highmark combines five-star service with comforts of home

By Jeri Clausing
When it comes to skiing, travelers
generally have to make a choice
between the amenities and space
of private homes and condomini-
ums and the daily housekeeping
and other round-the-clock ser-
vices of a hotel. But a new luxury
hotel in Colorado’s Steamboat
Springs changes that, offering
guests the best of both worlds.
let parking; ski valet service, so holiday weeks. Rates for the larg- of deals, including a third night 10%, with a rate of 15% being of-
guests never have to schlep equip- est penthouse suites range from free or packages that include lift fered on select weeks from Janu-
ment across the street to the ski $409 to $1,799 a night. But like tickets or both lift tickets and ski ary through March. For more,
gondola; and on-call, front-door most ski resorts right now, the equipment. call (877) 879-6555 or visit www
shuttle service to the mountain or Highmark is offering a number Travel agent commissions are .highmarksteamboat.com.
into town.
Extras like private cooks, in-
room massages, grocery delivery
and full laundry and dry cleaning
services are also available at an
additional charge.
The concept, sales director
U N F O RG E T TA B L E S N OW
U N F O R G E T TA B L E E S C A P E
REMEMBERING IT ALL

is more.

Suites at the Highmark in Steamboat

Springs offer both the spaciousness of
private condo homes and the array of
services available at luxury hotels.

Although the Highmark oper- Elisabeth Mullen admitted, can be

ates as a full-service luxury hotel, confusing to people used to more
there are no hotel rooms at this traditional vacation rentals, which
resort, only large, top-of-the-line usually charge extra for daily or
“suites” that rival some of the ski even midweek maid service.
area’s best private home and con- “When I tell people we have
do rentals. daily maid service, they’ll ask,
The smallest units, at 1,600 ‘How much does that cost?’” Mul-
square feet, have two bedrooms, len said.
three bathrooms, a study and a Indeed, I was confused after
large, gourmet kitchen. The larg- seeing some of the units. I wasn’t
est, four-bedroom units measure sure if I was in a hotel or private
2,400 square feet. condominium property.
The units are decorated in a Mullen said some of the units Selling our five world-class resorts couldn’t be easier.
Western style inspired by designer are privately owned, but the prop-
Ralph Lauren, with large, comfort- erty, she emphasized, is operated In today’s competitive travel market, our resorts truly offer something for everyone: families,
able couches and chairs, full din- and marketed as a full-service honeymooners, group travelers, spa enthusiasts, food and wine connoisseurs, and adventurous
ing room tables and small sitting luxury hotel. spirits looking for a new thrill.
areas in each of the bedrooms. And owners are restricted from
Open just six months, the units using the property during peak You will be amazed at how easy it is to book a vacation through our Inside Sales Desk. One phone
boast the latest technology, with holiday weeks, to make sure all 23 call will connect you to a reservation expert who is prepared to book every aspect of your
flatscreen suites are clients’ vacations. All facets of vacation packages are commissionable at a minimum of 10%
TVs in available with additional overrides based on volume. That’s right, you even profit on the lift tickets.
the living Private cooks, in-room mas- for rent.
rooms and sages, grocery delivery and The ser- Call our Inside Sales Desk at 888.521.SNOW
bedrooms vice rivals
and iPod laundry and dry cleaning that of a
docking Ritz-Carl-
stations
services are also available. ton or Four
that enable Seasons.
guests to listen to their own music Every time we walked into the
in any room. lobby, someone, including the ho-
They also have large, jetted tel manager, was there to greet us
tubs; sandstone fireplaces; private and offer shuttle services.
balconies; and separate laundry The hotel is just across the ©2008 Vail Resorts Management Company. All rights reserved. Designated trademarks property of Vail Trademarks, Inc.
rooms with large, front-loading street, and only 300 yards, from Heavenly trademarks property of Heavenly Valley, L.P.

washers and dryers. the gondola, making for an easy

But unlike many of even the
finest traditional vacation rent-
als in ski areas, the resort offers
the best in luxury hotel services,
with 24-hour concierges; free va-
walk. But it’s nice to not have to
walk if guests don’t want to.
Rack rates for the smallest units
range from a low of $149 in the
fall to $899 a night during peak

W W W . T R A V E L W E E K L Y . C O M D E C E M B E R 2 2 - 2 9 , 2 0 0 8 31
tw_1222_31_31_20081217133539_73331 31 12/17/08 1:35:53 PM
 marketplace
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For advertising information, please contact Emmy at emorales@travelweekly.com or 201-902-1951
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HIRING?
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Happy Holidays and Are you looking to recruit a quality travel
agent? Want to get the word out about

all the Best in

your host agency, announce a special
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the New Year!

industry product or service? Armed with the latest knowledge of industry news and analysis, Travel Weekly
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Submit your ad and get rates:
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W W W . T R A V E L W E E K L Y . C O M D E C E M B E R 2 2 - 2 9 , 2 0 0 8 33
 •
opinion
The season

W
We figured out a long time ago the rhythm of
the sun, the equinoxes, the summer and win-
ter solstices. Science and observation took the
mystery out of them and made them predict-
able, but they remain powerful symbols.
We have our calendars and days of demarcation be-
cause we humans seem to need to know where we are
in the cycles of the sun and moon. Whether for planting
or prayer or mere reassurance, we need to know: What
season is this, what day? Is this the beginning, the middle,
the end?
Comically, however, we have a caveman’s understand-
ing of the moon when it comes to economic cycles: We
know prosperity will return, but we’re not sure when, or
where, or in what shape it will first appear. Nor do we
know how much harm will come to us as we wait.
So in a cloud of economic uncertainty, we come to
the end of a year, to the week of the winter solstice, the
Northern Hemisphere’s shortest day and longest night.
Many of us will be
celebrating Hanukkah,
EDITORIALS Christmas or Kwanzaa
within days of each
other and within days of a new year. We associate this
season with joy, good cheer, charity, goodwill.
We should add hope to the list.
Hope is said to be a virtue, but it is really a necessity.
Why else would the ancients mark the shortest day of the
year but to pin their hopes on the sun’s return? FORUM
Our seasonal wish to our readers, friends and col-
leagues in travel is hope of all kinds, including the hope
that prosperity really does come in cycles and that we will
recognize it when it returns. WHEN THE GOING GETS TOUGH, THE TOUGH GET GOING

The year Recommendations for marketing in a recession

By Bob Adams 3. Build models and score your database. Embrace the

T
This issue features our annual review of some of the ma-
jor events and trends of 2008. It is a convenient and ar-
bitrary tradition to make it a list of 10, but it could have
been eight, or 14 or even 20.
But could it have been zero?
As we note in our annual review, 2008 will be remem-
bered in history for the election of Barack Obama, and
in economics for the recession. In travel, however, is it
worth remembering at all?
We had evolutionary changes in travel technology, but
if there was a killer breakthrough, we seem to have for-
gotten it already.
The giant Airbus A380 arrived, at last, but we knew it
was coming.
It may have been a notable year for what didn’t hap-
pen. ARC didn’t raise its fees, no big airlines went bank-
rupt, Boeing’s Dreamliner didn’t arrive.
We don’t remember saying “This is an outrage” as of-
ten as we have in past years.
We had big new ships, but nothing with the fanfare of
the first ships to break the 100,000-ton or 200,000-ton
barriers, or the launch of a Queen Mary 2.
We had a big airline merger, but they haven’t actually
merged yet, and anyway, it doesn’t seem to be shaking the
world yet.
The airlines and the GDSs were not at each other’s
throats. There was no Southwest-Orbitz feud. No fare
war. The airlines had a price-fixing scandal, but it was
mostly about cargo rates.
Where was the buzz? Was it a boring year?
Should we hope for more excitement next year, or is
this what we want in our professional lives: a steady series
of small steps, small defeats, small victories?
he travel industry has been hit hard by the economic
T crisis. Hotel occupancy is down, airlines are report-
ing a sharp decline in passenger traffic, and con-
sumers are cutting back on discretionary spending.
The National Bureau of Economic Research recently an-
nounced what economists have been saying for some time:
We’re in a recession and have been since December 2007.
History has proven that the vast difference between the media are working best for your customers, and be sure
losers and the winners during a recession or depression
is that the best-performing companies aggres-
sively increase communications with customers
and step up marketing and advertising efforts.
If your company fails to maintain consumer
awareness during a recession, both current and
future profits are in danger. Experts advise tak-
ing advantage of the current economic down-
turn as an opportunity to grow revenues, build
brand awareness and grow market share. Bob Adams
The top 10 actions for marketing during a re-
cession are:
1. You will survive or perish within your customer
base. In uncertain times, when budgets are being scaled
back, people buy from those they know. This means
you’ve got to engage with your customers more frequently
and deeply than ever before. Now is the time to mine your
customer database. It’s a good time to do a customer val-
ue segmentation analysis to determine which customers
bring the most value to you.
2. Data is king. Make sure you have good, enriched cus- carefully choosing how to spend their dollars. Recent
tomer data so you can segment by multiple criteria. The
more targeted you get, the more effective your message
and customer communications will be.
power of analytics and customer segmentation. This can
be a very effective exercise in determining which custom-
ers have the greatest propensities for certain behaviors.
4. Devise a strategy. Strategy is about sacrifice: If every-
thing is a priority, then nothing is a priority. If you have
no priorities established, you will sprinkle your marketing
dollars all over and get no impact.
5. MROI is mandatory. Understand what channels and
you can quantify these in terms of a marketing return on
investment, or MROI, analysis. The closed-loop
channels of direct marketing (i.e., direct mail
and digital) will serve you well in this regard.
Remember: Inspect what you expect!
6. Measure everything. Know what works and
what doesn’t. Stop doing what doesn’t work.
7. Don’t pay more than you have to. If you
can get the same response from a low-cost chan-
nel/creative as you’ve received from an expen-
sive mailing piece, either don’t spend those extra
dollars or redeploy them to additional targets. More than
80% of consumers are researching travel online, and al-
most as many are purchasing there, so be sure you are do-
ing everything possible to optimize your website and this
channel.
8. Build a message that’s appropriate. Are you ap-
pealing to someone’s sense of luxury? Or to a sense of
cost-consciousness? A tailored message is always appro-
priate, but especially so during a time when people are
surveys show that traveling consumers are looking for
value, and they will be doing more than their fair share
of comparison shopping online. So, put your most at-

34 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_34_35_20081218143916_73634 34 12/18/08 2:39:23 PM

 OPINION

E-mail: To contact most Travel Weekly staffers,

type their first initial and last name,
followed by @travelweekly.com.

No one ever said it would be easy

Phone (headquarters): (201) 902-2000
Fax (headquarters): (201) 902-2034

VICE PRESIDENT/EDITOR IN CHIEF:

ARNIE WEISSMANN

T
here is always that hope. There is always the chance that
the old ways of doing things in our industry will give way
to the winds of change. Of course, like you, I doubt it. But
how much worse can it really get? We just have to believe that
there are better times ahead.
The president-elect has so much on his
plate, one wonders why he would even step
near the dining room. We can sympathize
and wish him well.
For those of us who sell fantasy, rejuve-
nation, exploration and understanding,
this new year could not have come at a bet-
ter time. For those of us who sell what is,
bottom-line, discretionary self-gifting, this
old year has ended none too soon.
Air travel has become such a hassle that
growing numbers of the population believe
that it just isn’t worth the bother. How do
we convince them otherwise? How do we
humanize the airport experience?
For those of us who promote the belief
that it is well worth the hassles to actually
get somewhere, increasing numbers of our
clients find us redundant. “What can you
possibly do for me that I can’t do for my-
self?” they ask.
I am not sure that we, as an industry,
have been even remotely effective at an-
swering the question. We are seeing a new
challenge, the fulfillment of dreams via In-
ternet-based vending
machines. And that
surely won’t go away
in the new year.
REALITY CHECK
Then there is the
erosion of the savings that so many mil-
lions viewed as the bedrock of future trav-
els. They had been looking forward to a
retirement filled with dream fulfillment
by a corps of well-traveled advisers. The
evolvement of the travel agent was wait-
ing for this moment, anticipating this new
year. But suddenly our clients’ dreams have
evaporated, and we are now desperately
trying to save Citibank and General Motors
while pundits are saying that any recovery
will take a very long time.
Add to that the Marriott Hotel bomb-
ing in Islamabad; the terror at the Taj and
Oberoi in Mumbai; and the inability of 24-
hour news to pause — for just a moment,
for just a breath — to consider whether
an American hotel room. EDITOR: ROB FIXMER
The cruise lines figured out that the new MANAGING EDITOR: REBECCA TOBIN
passenger does not want to be told what to EDITOR/NEWS & OPINION:
do. They want options. Lines are racing to Bill Poling (202) 429-9030; Fax (202) 429-9054
fulfill these dreams, and the new Royal Ca- DEPUTY MANAGING EDITOR:
ribbean advertising slogan, “The Nation of Gerry Bourbeau
Why Not,” reflects these chang- MANAGING EDITOR/SUPPLEMENTS:
they got their facts right. es. Although for many tech-sav- Margaret Myre
The result is commentary on vy consumers, they might have EDITOR/DESTINATIONS:
MSNBC that “terrorists are in- added the word “Now.” Kenneth Kiesnoski
creasingly targeting five-star ho- Want to walk on real grass, SENIOR EDITORS:
tels where Americans stay.” have dinner in a Le Cordon Bleu Michelle Baran (Tour Operators)
Are they? In the case of India, Restaurant, sleep outdoors on a Jeri Clausing (Hotels & Hospitality)
it turns out they weren’t. But Balinese bed, lounge in an “adults (720) 379-8123
the message has gotten through only” spa area? These options are Michael Fabey (Aviation)
(202) 429-9033
to those contemplating travel Richard Turen all currently available, and there
abroad. Perhaps it would be are lots more to come. Johanna Jainchill (Cruise, Alaska)
best to avoid the name hotels that cater to Then there is the product line that gives Gay Nagle Myers (Caribbean)
Americans. As the commentator pointed the agent the greatest cause for optimism: Kimberly Scholz (Familiarization Trips)
out, “The terrorists have learned that these the tour sector. The nation’s best tour op- EDITORS AT LARGE:
five-star hotels have no security at all.” erators pay agents commission on the full Lester Craft (970) 927-0450
So the challenges we face in this new year value of the trip. They have the flexibility Nadine Godwin (Retail) (212) 452-7819
seem impossible. But like our brethren in to increase departures in some areas of the COPY EDITOR:
real estate sales, we somehow see change world while reducing their exposure in Eric Moya
for the better in our collective future. This others. They are nimble, and they are cost EDITORIAL ASSISTANT:
new year, we will get it right. effective. They are easy to book, they sup- Theresa Bednarczyk
So where do we look for optimism as port the agent community, and they pay ART DIRECTORS:
this new year approaches? the highest dividends. Romina Paludi, Thomas Lechleiter,
Fuel prices have come down, and Ameri- Watch, in this new year, as more and Thoralf Tollefsen
can Airlines finally broke the aircraft-order more cruise-only firms begin to include CREATIVE CONSULTANT: J-C Suarès
silence with a sizeable claim to the new escorted tour programs in their product
CONTRIBUTING EDITORS:
787. Virgin America is showing that pas- lines. Harvey Chipkin, Laura Del Rosso,
senger loyalties can So we have still one more chance to get Damon Hodge, Felicity Long, Kristin O’Meara
be shifted quickly, it right. And we will. Because if things Hillmann, Joe Rosen, Tim Ryan, Dennis
Schaal, Jorge Sidron, Richard Turen
and Southwest con- seem tough now, we don’t have to go very
tinues to understand far back in our history to reach the times TRAVELWEEKLY.COM:
what passengers re- of the Greatest Generation, when world EDITORIAL DIRECTOR: Lester Craft
ally want from their airline. war quickly followed on the heels of de- WEB EDITOR: Jerry Limone
There is reason for optimism in the ho- pression. And they handled it. MANAGING EDITOR: Kimberly Scholz
tel sector, as traditional decor, design and We sell the world. We see the world. We WEB SERVICES MANAGER: Linda Buchanan
service standards are all subject to scrutiny. work in professions that share a common WEB ADMINISTRATOR: Karen Nyland
The hotel industry, particularly the upper bond. We all deal with the best moments ELECTRONIC PRODUCTS MANAGER:
end of the market, now understands that of people’s lives. Who are we to feel sorry Neal Tornopsky
guests are coming from some pretty nice for ourselves? Who are we to say we won’t
TRAVEL WEEKLY PRODUCTION:
home environments, complete with media come out of this slump? We have, we can PRODUCTION SUPERVISOR:
rooms, bathrooms that resemble small spas and we will. Michele M. Garth
and loftlike brick and stone. They expect We have another chance to “get it right.” PRODUCTION SPECIALISTS:
their hotel rooms to reflect their taste. Adrian Carbunescu, Lisa Gonzales,
That message has been heard, and the Contributing editor Richard Turen owns Michele Leone
industry is reacting with redesigns and Churchill and Turen, a vacation-planning GROUP CIRCULATION DIRECTOR:
new concept hotels that will revitalize the firm that has been named to the Conde Nast Simon Young
industry. I can’t wait to get my invitation to Traveler’s list of the World’s Top Travel Spe- PRODUCTION DIRECTOR:
Robert Brai
the black-tie event celebrating the removal cialists since the list began. Contact him at
of the last swatch of shag carpeting from rturen@travelweekly.com. ELECTRONIC PRE-PRESS:
Patrick Fox, Sal Lamourt

TRAVEL WEEKLY MARKETING:

tractive offers right up front without sub-
jecting them to a litany of terms and con-
ditions or disclaimers.
9. Don’t forget the basics. Analytics, tai-
lored messaging and good strategy are all
important. But don’t forget the basics of
hygiene on your data. If your contact and
address information isn’t right, you’ll waste
money on three levels: 1) processing bad
FORUM
records; 2) mailing/emailing records that
won’t get there; and 3) missing the opportu-
nity to contact “good” records.
10. Don’t stop. Everybody wants to cut
costs during recessionary times, and it
makes sense to scale back somewhat. But
don’t stop altogether: Let your competi-
tor stop, and when he does, that’s when
you should be eating his lunch. If you can
MARKETING MANAGER:
Kathryn Noval
MARKETING ASSISTANT:
Ashley Jobe
continue marketing during the downturn, MANAGER, CUSTOM PUBLISHING:
Michaela Siegrist
you’ll emerge with greater market share and
EDITOR, CUSTOM PUBLISHING:
a happier customer base when the economy Erin Etheridge
picks back up. GRAPHIC DESIGNER, CUSTOM
PUBLISHING: Alissa Rea Williams
Bob Adams is a subject matter expert for
travel and entertainment within Acxiom
Corp.’s Information Products & Solutions
group.

W W W . T R A V E L W E E K L Y . C O M D E C E M B E R 2 2 - 2 9 , 2 0 0 8 35

tw_1222_34_35_20081218143916_73635 35 12/18/08 2:39:31 PM

 NEWS

LUXURY WEALTHY AMERICANS PLANNING A CRUISE IN THE NEXT 12 MONTHS

Continued from Page 1
E-mail: To contact most Travel Weekly staffers,
type their first initial and last name, followed 21% 22%
by @travelweekly.com. housing boom turned to bust.
Phone (headquarters): (201) 902-2000 As a result, the number of wealthy Amer- 19% 19%
Fax (headquarters): (201) 902-2041
icans who now plan to take a cruise in the 18% 17%
VICE PRESIDENT/PUBLISHER: 16%
BOB SULLIVAN next year fell to its second-lowest point
14% 15% 15% 14% 14%
Phone: (201) 902-1956; Fax: (201) 902-1971 since the American Affluence Research Cen- 13% 13%
ASSOCIATE PUBLISHER: ter began tracking such data in 2002.
BRUCE SHULMAN
Phone: (561) 799-1788; Fax: (561) 799-1731 Fourteen percent of respondents in the
REGIONAL ADVERTISING SALES MANAGER: AARC’s biannual survey of the wealthiest
BARBARA FRIEDMAN 10% of all households expressed an inter-
CT, MA, ME, MD, NJ, NYC, RI, VT
Phone: (201) 902-1934; Fax: (201) 902-1971 est in taking a cruise in the next 12 months,

Spring 2008
Spring 2006
Spring 2004
Spring 2002

Spring 2003

Spring 2005

Spring 2007
down from 22% a year ago. The lowest that

Fall 2008
Fall 2006
Fall 2004
Fall 2002

Fall 2003

Fall 2005

Fall 2007
REGIONAL ADVERTISING SALES MANAGER:
SHARI WEINSTEIN number ever fell was 13%, just after the in-
DC, LI, NYC, NY, OH, VA, WV
Phone: (201) 902-1936; Fax: (201) 902-1971 vasion of Iraq.
REGIONAL ADVERTISING SALES MANAGER: “The next year or so will be very chal-
HAZEL JANE LYONS lenging for the luxury lines,” said Ron Kurtz, Note: Bars represent period when survey was taken. Source: The American Affluence Research Center
Caribbean, Bermuda
Phone: (201) 902-1992; Fax: (201) 902-2041 president of the AARC and a former cruise
REGIONAL ADVERTISING SALES MANAGER: line executive. “This will be a function of land Hills, Calif., noted that late fall is tra- ity and innovation we have to bring to it.”
RACHEL GUTIERREZ the new capacity and the economic/stock ditionally slow for cruise sales anyway, so it Snitzer said that for now, Seabourn book-
CA, ID, MT, OR WY
Phone: (310) 954-2508; Fax: (310) 954-2504 market conditions.” is difficult to gauge exactly how severe the ings were holding up, and the lines’ winter oc-
REGIONAL ADVERTISING SALES MANAGER: Paradoxically, it was Kurtz who said in downturn is. Reder said there had been cupancy levels were not much different than
EDWARD CONNOLLY late 2006 of Seabourn’s new ship order, some cancellations and that some people last year’s. They are currently focused on the
AK, AZ, CA, NM, NV, UT, WA
Phone: (310) 954-2532; Fax: (310) 954-2504 “The luxury market is underserved.” were just waiting out the economic storm. summer sailings, when the first of their new
REGIONAL ADVERTISING SALES MANAGER: Nor was he wrong. At that time, travel “We’ve got the clientele, and we’ve got a vessels, the Seabourn Odyssey, makes its de-
SETH CARPIEN agents complained about not being able to lot in the books,” she said. “But right now it but. As part of a public company, Seabourn
Mid-West, CO
Phone: (336) 714 3310 ; Fax: (336) 896-0555 get the cabins their clients wanted on luxury has really slowed. People are going to travel, declined to divulge specific numbers.
REGIONAL ADVERTISING SALES MANAGER: lines like Seabourn and upscale products and there is still money out there.
JAY NELSON like Oceania. “But everything is crazy. Between the ‘Like three booking years in one’
FL, GA, NC, SC
Phone: (727) 797-9758; Fax: (727) 796-1293 Now, the agents say, those lines are com- economy, terrorism and all the deals com- But over at Regent, President Mark Con-
Cell: (727) 432-5283 ing out with unprecedented discounts as ing out, they wonder if they should wait, if roy said that in contrast to 2008, the line’s
E-mail: jnelson@travelweekly.com
they attempt to fill their ships. they should book, make a deposit. It’s the best year ever in terms of revenue and prof-
REGIONAL ADVERTISING SALES MANAGER:
SANDRINE MALLORCA “Crystal, Seabourn, they all have space uncertainty.” it, 2009 was already 7.5% behind in book-
Eastern Europe, France, Monaco, Switzerland where they never used to have much,” said Reder said the deals that the upscale lines ings.
Phone: (011) 33-67 369-9785
Fax: (011) 33-4 9370-8019 Jerry Davis, president of Alice Travel in Fair- have been putting out recently were also “2008 has been like three booking years
E-mail: smallorca@ntmllc.com field, N.J. “Silversea is offering 25% com- changing upscale consumer behavior. in one year,” Conroy said. “If you asked me
MANAGER, CLASSIFIED SALES: mission. Regent has how business was in early May, I’d have said
EMMY MORALES
Phone: (201) 902-1951; Fax: (201) 902-7283 tactical offers. Crys- that not only will we beat our plan by 25%
HAWAII tal just reduced many in 2008, but we’re going to be 75% or 80%
DESTINATION MARKETING
DEBBIE JOSEPH European sailings for sold out for 2009. That’s how good book-
3555 Harding Ave, Suite 2C, Honolulu, HI 96816 summer 2009.” ings were.”
Phone: (808) 739-2200; Fax: (808) 739-2201;
E-mail: Josephd001@hawaii.rr.com Dav is said the By the middle of May, Conroy said, that
CENTRAL AMERICA/ SOUTH AMERICA lines’ exotic itin- 25% forecast had fallen to 10%. Then, in
TRM, TRAVEL REPRESENTATIONS eraries have been September, things “changed drastically.”
& MARKETING
LILLIAN MARTINEZ hit hardest : “A lot “We are seeing cancellations fairly close
495 Biltmore Way, Suite 404, Coral Gables, FL 33134
Phone: (305) 476-1130; Fax: (305) 854-4589;
of them are seeing Ron Kurtz Mark Conroy Gregg Michel into when final payment is due and before
E-mail: twtrm@earthlink.net drop-offs they didn’t President President President penalties kick off,” he said. “What I’m hear-
LOUISIANA/MISSISSIPPI expect to see. World AARC Regent Seven Seas Crystal Cruises ing from agents is that in the past, once you
DESTINATION MARKETING CONSULTANTS, INC
STU BARASH cruises that were full got a deposit from someone, unless some-
9535 Bearden Creek Lane, Humble, TX 77396 now have space. The stock market has really “Every minute the luxury lines are com- thing [very bad happened], they were going
Phone: (281) 459-6605; Fax: (281) 436-0698
MEXICO put the break on exotics, and that’s what the ing out with something,” she said. “And the to go. Now, you can’t take that for granted.
TOWMAR cruise lines sell in the first quarter.“ consumers know it. So they are going to be You have to keep in touch and keep them
JUAN MARTINEZ DUGAY
PALOMA MARTINEZ last-minute to be sure they get the best deal.” engaged in the idea of going.”
Presa de la Angostura, 8, Col. Irrigacion Orient Line’s relaunch delayed The prices are dropping fast. A one-week The lines all say that the incentives are
Mexico DF 11500
Phone: (011) 52-55 2122-3900; The stock market also put the brakes on Seabourn sale this month offered 60% off helping stimulate business.
Fax: (011) 52-55 5395-4985 an entire cruise line’s rebirth. summer 2009 sailings in Europe, while Bill Smith, senior vice president of sales
E-mail: jmdugay@towmar.net,
pmartinez@towmar.net Wayne Heller canceled Orient Line’s Crystal is offering $1,500 discounts on Eu- for Crystal, said the savings in Europe and
CANADA inaugural season last month, saying the rope cruises. Both Regent and Oceania are air programs to both Asia and the Mediter-
AMERICAN PUBLISHERS REPRESENTATIVES scheduled April relaunch was being delayed offering two-for-one deals on some sailings ranean have stimulated bookings, as have
FRANCOISE CHALIFOUR
41 Britain Street, Suite 303, Toronto, Ontario as a result of economic conditions. and free air. its reduced deposit and shortened cancel-
M5A 1R7 Canada Orient opened its bookings for the Marco “Thirty-to-forty percent is a typical dis- lation penalty period programs.
Phone: (416) 363-1388, Ext. 237; Fax: (416)-363-2889;
E-mail: fchalifour@aprcanada.com Polo II, the ship it acquired in August, just count,” said Stewart Chiron, president of “Cancellations are running slightly
EUROPE/ASIA before the Dow plunged. Initially, Orient’s Leisure Pros. “Sixty percent is extraordinary. ahead of last year but not as deep as 2001,”
MANAGING DIRECTOR,
INTERNATIONAL SALES: itineraries were all more than 10 days and Two-for-ones is the end of the road. They Smith said. “This time of year, business is
PIERRE-DENIS BERNOUX were to focus on exotic itineraries, the very are clearly trying to stimulate bookings.” traditionally slower. We are coming out
U.K., Belgium, Luxembourg, Eastern Mediterranean,
Ireland, Russia, Czech Republic, the Netherlands types of sailings that other cruise lines said For Seabourn, which is also offering with some new stimulus packages to help
Phone: (201) 902-2026; Fax: (201) 902-2035; were hurting the most. $1,000 off seven-day Mediterranean cruises agents and clients take advantage of the
E-mail: pbernoux@ntmllc.com
ITALY Reflecting this new reality, Crystal Cruis- in summer 2009, its deals reflect not only Wave season.”
MCDERMOT MEDIA SRL es said it would almost double its number the economy but the fact that the line is tri- Conroy, too, said consumers were react-
DAVID MCDERMOT
Cell: (011) 39-335-6347683 of cruises of 10 days or less in 2010, to both pling its inventory over the next three years ing to Regent’s deals, and that the line had
Fax: (011) 39-06-9086741 attract new cruisers and meet the demand with the addition to its fleet of three 450- recently experienced strong bookings for
E-mail: mcdermotmedia@tiscali.it
ASSOCIATE PUBLISHER, TRAVEL PROFESSIONAL:
for downsized vacations. passenger vessels between 2009 and 2011. January sailings.
JOANNE NELSON “We do recognize there are some travelers “This is a period of extreme, rapid “People were sitting on the sidelines and
Phone: (201) 902-1931; Fax: (201) 902-2041
who are downsizing, who love the Crystal growth,” said Adam Snitzer, Seabourn’s said, ‘Heck, it’s time to go’,” Conroy said.
NORTHSTAR TRAVEL MEDIA LLC
CHIEF EXECUTIVE OFFICER: experience and want a Crystal vacation but vice president of marketing. “Bringing new “They might put off buying a car this year,
GEORGE HUNDLEY want to spend less on their overall vacation,” people into the Seabourn market is a huge but I can’t see them not traveling.
CHIEF FINANCIAL OFFICER:
TOM WRIGHT
said Gregg Michel, Crystal’s president. imperative for us. With the economic chal- “These are people who take five trips a
Both Davis and Susan Reder, president of lenges out there, that makes the challenge year. They might take one less. Hopefully, it’s
Altour/Classic Cruise and Travel in Wood- even greater in terms of the level of creativ- not my cruise.”

36 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_36_36_20081218171316_73536 36 12/18/08 5:13:35 PM

 NEWS

Fla. agent caught in the middle of a United debit memo morass

By Nadine Godwin
The tiniest errors can cost agencies plenty
in airline debit memos, but when one of
those debit memos could turn into a four-
figure windfall for an airline, the lesson is a
little hard to swallow.
Just ask Don Bourassa, who is an out-
side consultant for Travel Source in Coral
Gables, Fla.
On June 23, Bourassa booked a client to
Africa, taking advantage of an Ethiopian
Airlines promotional fare and using United
for the connecting service into and out of
Washington for the Ethiopian flight.
The roundtrip fare, autopriced on Ama-
deus, totaled $2,358.30, and Ethiopian paid
a commission of $116.94. The passenger
departed on Aug. 1.
On Aug. 18, United issued a debit memo
to Travel Source for $5,701.94. United’s
computers priced the trip at the full econ-
omy fare of $7,943.30, and the debit memo
was calculated to collect the fare difference
plus the commission.
However, Ethiopian billed United for its
promotional fare, rather than full economy.
The debit memo amount, except for the
commission, is a windfall for United.
As an outside agent for Travel Source,
Bourassa is liable.
The debit memo is reflective of an envi-
ronment in which airlines are pushing ever
harder to recover money from travel agents
for the slightest slip-up.
The agent’s oversight in this case was ne-
glecting to override Amadeus. To qualify
for the promotional fare, the ticket had to
be plated on Ethiopian, but Amadeus plat-
ed it on United.
Bourassa knew the ticket had to be plat-
ed on Ethiopian, but he let Amadeus auto-
price the ticket and presumed that Amade-
us would meet the conditions of the tariff.
Also, he said, when there is something
unusual about an international booking,
Amadeus typically forces him to select a
ticketing carrier by stopping the process,
but that did not happen in this case.
He discovered the plating mistake when
going over paper invoices three days later;
by then it was too late to void the ticket and
rebook. At that time, although he did not
yet know United had repriced it, he asked
the carrier if he could refund the ticket and
rewrite it on Ethiopian while the fare was
still valid, but “I got a big, fat no,” he said.
For Bourassa, it comes down to this:
Should selection of
the validating carrier
be the responsibil- United issued a debit memo to Travel Source for $5,701.94.
ity of the autopric-
ing system when a United’s computers priced the trip at the full economy fare of
fare is valid only if a $7,943.30. But Ethiopian billed United for its promotional fare.
specific carrier is the
plating carrier?
Amadeus, by press time, had not an-
swered that question. But in September it
declined to take responsibility for the Unit-
ed debit memo, saying it was the agent’s
responsibility to ensure carrier validation
rules were observed.
Debbie Iannaci, public relations director
of Amadeus North America, explained that
the GDS’ validation algorithm uses the first
carrier on an interline itinerary.
As for Bourassa’s situation, she said the
agent would have seen the results of the au-
topricing along with this warning: “Ticket
stock restriction. Priced with validating car-
rier ET — reprice if different VC.”
In addition, she said, given that the agent
did not specify Ethiopian as the plating car-
rier, “when the ticket was issued, the agent
would have seen the higher fare. The agency
should have questioned this at that time
and contacted Amadeus or used the over-
ride for the ticketing.”
Bourassa said he did not see a ticket-re-
striction notice and certainly did not see or
issue a ticket with a higher fare.
Ethiopian has confirmed it collected only
the promotional fare from United.
Generally speaking, airlines assert that
their debit memos are meant to recover
losses produced by travel agents.
In this case, however, United has not
“lost” $5,701.94. Bourassa claims that, ex-
cept for the commission (which he expects
to repay), United has lost nothing.
Nevertheless, United has not dropped its
claim and, at press time, had not responded
to several requests from Travel Weekly for
information about its intentions.
Meanwhile, Mark Pestronk, travel lawyer
and Travel Weekly columnist, said he had
seen one such case, last year. The vendor
was Sabre, the long-haul carrier was Air In-
dia and the debiting carrier was American.
American backed off, Pestronk said.
ARC
Continued from Page 1
Scranton, has been operating public char-
ter flights for several years, including flights
in some smaller markets using regional air-
craft. Gallagher said it was one of the first
public charter operators to have its inven-
tory displayed in GDSs.
He said it had long been his goal to get
enhanced distribution for charters and to
bring the charter mode of transportation to
new markets, offering the equivalent of tra-
ditional scheduled service on niche routes
and in underserved markets.
Even for the top leisure charter opera-
tors, however, the charter product has not
had the easy access to the distribution
system that scheduled service has always
enjoyed. The new arrangement with ARC
could change that, Gallagher said.
Ethiopian Airlines said it was aware of
three other agencies that had been debited
after failing to select Ethiopian as the plat-
ing carrier on its promotional rate.
Two involved Sabre and American, and
the third involved Amadeus and United.
One of the agents, Norbert Bercovici at
Norman’s Wholesale Travel World in
Brooklyn, N.Y., said he knew he had made a
mistake in not overriding Amadeus.
In his case, the difference was between
$700 and $800, which
he called “found
money for United.”
Bercovici paid it,
but he bashed Ama-
deus’ algorithm. “It
can about make om-
elettes; why can’t it
pick the right [plating] carrier?”
Iannaci said Amadeus was working on
enhancements to validating-carrier pro-
cessing, but it was not clear if the upgrades
would eliminate situations of this type.
“You can’t get any better distribution
than e-ticketing via the GDSs,” Gallagher
said. By getting into ARC, he said, “We have
crossed the bridge.”
Participating in the GDSs and ARC, he
said, would enable his company to contract
with airlines to offer regular patterns of
service in nontraditional charter markets,
such as point-to-point service between
small communities or in midsize commu-
nities that have lost service due to recent
airline cutbacks.
When there is market demand, he said,
“we can spool up and be in a marketplace
quickly,” with a lot less risk than legacy
scheduled airlines.
He said he also expected that the reserva-
tions, ticketing and remitting compatibility
would enable agents to combine charter
transportation and traditional scheduled
transportation in a single transaction.

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W W W . T R A V E L W E E K L Y . C O M D E C E M B E R 2 2 - 2 9 , 2 0 0 8 37

tw_1222_37_37_20081218172516_73337 37 12/18/08 5:25:29 PM

 NEWS

A year later, U.S. awaits payoff from China travel agreement

By Michelle Baran
One year after the U.S. and China signed a
memorandum of understanding that allows
Chinese leisure travelers to visit the U.S.,
businesses that were banking on a flood of
new Chinese visitors are still waiting.
The agreement was “historic; it was good
for our relationship with China,” said Noel
Hentschel, CEO and chair of American-
Tours International, which just opened
its Beijing operation, called Chinamerica
Tourism.
But, she added, “It’s not a quick profit.
This is the beginning. I’m not saying [travel
companies] should not begin those steps,
PORTRAIT OF A VISITOR
FROM CHINA
What will Chinese visitors want to do
once they get here?
According to a 2007 telephone sur-
vey of 7,000 randomly selected Chinese
adults age 18 or older, the U.S. is the
most frequently cited dream destina-
tion for Chinese travelers, followed by
France.
The survey results, released this month
by the Travel Industry Association, reveal
that the average length of stay of a Chi-
nese visitor to the U.S. is 25 nights and
covers two states. Typical advance trip
decision time is 45 days.
Here, according to the survey, are the
top activities by Chinese travelers:
Shop: 90%
Dine in restaurants: 82%
Sightsee in cities: 53%
Visit historic places: 45%
Casinos/gambling: 29%
Amusement/theme parks: 25%
Visit national parks: 25%
Note: Multiple responses were allowed
Source: Travel Industry Association
but they need to be prepared [for] a long-
term return on those investments.”
The U.S. Commerce Department esti-
mates that the annual number of Chinese
visitors to the U.S. will reach 579,000 by
2011, up from 397,000 last year, with an av-
erage per-person, per-visit spend of $6,000.
While the prospects are tempting, the re-
ality is that it will be a while before stateside
suppliers and operators can cash in on the
potential of the China source market.
Roy Graff, managing director of China-
Contact and director of business develop-
ment in Asia for Sportsworld, a sporting
events packager, said initial expectations
had been inflated by hype.
“Despite the travel industry’s PR machine
promising huge returns from the tourism
agreement with China,” Graff wrote in an
email, “the truth was always that tourism
growth will be slow and gradual.”
According to Graff, the U.S. Embassy in
China enforces a quota on the number of
visas given out each year and has planned
for an annual increase of 10% to 11%,
which means the number of Chinese visi-
tors to the U.S. can grow no faster than that
rate.
“Making tourist visas available does not
solve the visa application problem,” Graff
wrote. “Chinese still have to go through
hoops to prove themselves worthy of a visa.”
Another unknown is to what extent the
global economic crisis is affecting China
and potential Chinese travelers.
Bruce Bommarito, executive vice presi-
dent and COO of the Travel Industry As-
sociation, said that while the rest of the
world was crashing, China was still seeing
economic growth, just slower economic
growth.
That said, Bommarito said that while
Chinese visitors to the U.S. increased by
24% in 2007, a slowing economy could cool
year-over-year increases to about 14%.
“We’ve had a chance to seriously market
in China,” Bommarito said. “The potential
is virtually unlimited.”
Taking a leisure trip to the U.S. is an en-
tirely new concept for many Chinese travel-
ers. Consequently, they and the businesses
that will be catering to them have a lot of
learning to do.
“It’s a very im-
mature market,
and it has not
been well pre-
pared for being
able to come to
the U.S.,” said
Hentschel. The
existing Chinese
leisure market
in the U.S., she
pointed out, has
“been operating
under the radar. From left, Noel Hentschel of AmericanTours International; China’s vice ket continues to
They use vans minister of commerce, Xiuhong Ma; and singer Olivia Newton-John.
that have no in-
surance. In Los Angeles, they’ve been put-
ting them up in Compton, and they think
they’re staying in L.A. And the people have
had a negative impression of America.”
It was for that reason that Hentschel
opened the Chinamerica Tourism opera-
tion in Beijing this fall. While the majority
of the funding comes from ATI, she gets ad-
ditional financing from U.S. destinations.
“We have permission to represent all 50
states for training, promotion and product
development,” Hentschel said. “The No. 1
thing that needs to happen is the training
in what the USA product is.”
Until now, the typical itinerary of a Chi-
nese visitor to the U.S. has included New
York, Washington, Los Angeles, San Fran-
cisco and Las Vegas. Hentschel is trying to
educate the Chinese consumer about the
entire breadth of U.S. destinations and at-
tractions.
“It means basically re-educating the
market on what is the best American expe-
rience,” she said. “They’ve only been eating
in Chinese restaurants and mostly shop-
ping with the local Chinese.”
To that end, she has launched two mar-
keting campaigns in China. The first plays
on the Chinese tradition of saving before
spending, advising, “If you want to save,
the best way is to travel to America, because
the value is so
strong.” The sec-
ond focuses on
the six senses of
America, show-
casing the di-
versity of food,
music, people,
etc., that can be
experienced in
the U.S.
While the
Chinese mar-
learn about the
U.S., ground op-
erators here are ready and eager to welcome
the new business.
NTA’s approved operator list
Earlier this year, the National Tour As-
sociation launched the China Inbound
Program after the China National Tourism
Administration appointed the NTA to de-
termine which U.S. tour operators would
be allowed to work with Chinese tourists.
There are now more than 150 approved
operators on the list, and the NTA is host-
ing a new conference, the U.S. Travel Expo,
in Guam from April 1 to 4, at which Chi-
nese travel agents and companies will meet
with approved members of the NTA’s China
Inbound Program.
“Initial predictions: It was going to be a
massive influx,” said Evan Chan, manag-
ing director of Alhambra, Calif.-based Ritz
Tours, which was in the first group of ap-
proved operators. “China as a nation is af-
fected by the global turndown, but not as
much. They’re going to come; whether it’s a
lot or a few, they’re going to come.”

Norwegian Cruise Line, STX Europa agree to pare F3 ship order to one
By Johanna Jainchill
Norwegian Cruise Line downsized its F3-
class ship order from two to one in an
agreement reached with STX Europa on the
disputed newbuild project.
STX’s French shipyard STX France, for-
merly Aker Yards France, agreed to move
forward with construction of the 150,000-
ton, 4,200-passenger ship, the largest ever
contracted by NCL.
STX said the ship’s hull was in the early
phases of construction and on track for its
originally scheduled delivery date of May
2010. The planned second vessel, which
had been in the preparatory stages, will not
be built.
“With this agreement, we can all focus
on completing the new vessel successfully,”
Kevin Sheehan, NCL’s president and CEO,
said in a statement. “We are looking for-
At a media event last year, Jacques Hardelay, center, president of STX France, and Andy Stuart, NCL executive vice president ward to the arrival of our much-anticipated
of global sales and passenger services, held the first piece of steel set for F3 construction. F3 ship, as it represents a major step for-
ward for NCL in terms of ship size, design
and innovation.”
Further terms of the agreement, includ-
ing the final price for the new vessel, were
not being disclosed, said STX spokesman
Torbjorn Andersen. According to the origi-
nal contract, the ships were to cost about $1
billion each.
After much industry speculation, STX
revealed in September that it was involved
in a dispute with NCL over the construc-
tion costs of the F3 ships.
The yard said it was continuing work
on the project until a settlement could be
reached, but in early October, it suspended
purchasing supplies from its subcontractors
for the second vessel.
NCL had not commented on the dispute
until last week.
Jacques Hardelay, president of STX
France, said the yard and its subcontractors
would make the necessary adjustments to
their plans for the F3 project.

38 D E C E M B E R 2 2 - 2 9 , 2 0 0 8 W W W . T R A V E L W E E K L Y . C O M

tw_1222_38_38_20081218174217_73938 38 12/18/08 5:42:29 PM

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39T1222.indd 39 12/15/08 12:29:46 PM

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40T1222.indd 40 12/15/08 12:31:04 PM

Page bb1
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12/10/08
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USTOA 2009 DIRECTORY A SUPPLEMENT TO TRAVEL WEEKLY