My Thoughts on Travel and COVID19

Over the past week, my thoughts on travel during this season of COVID19 have evolved. These are just a few of my musings.

Retaining Alaska Airlines Mileage Plan Status

10 days ago Alaska announced a promotion that offered 50% bonus Elite Qualifying Miles for flights until April 11. So instead of needing to fly 20,000 miles for MVP, you could fly ~13,000 and gain status. With the price of flights at record lows, I picked up a few mileage runs to help set me up for MVP Gold through 2021.

However, a few things in my calculations have changed and I have canceled (or will cancel) these mileage runs.

First, there is too much uncertainty about flights right now. I don’t want to get stranded.
Second, I would guess that there will be some sort of status extension by Alaska in order to retain current elites that can’t re-earn their status. I would hate to put in the time and money for a mileage run only to find out I didn’t need to in order to keep my status.
Third, there is the responsibility piece. I want to help protect others and practice social distancing (tough on a plane).

My Travel Plans

Besides the mileage runs, I had an actual trip planned to Costa Rica for my Spring Break in mid April. Today I received an email from the Andaz, where I had a reservation, saying that the hotel will be closed until April 30. My flight was purchased through a certificate I won from Alaska Airlines during one of their Twitter contests. It expires in May so not sure if I will just lose it at this point.

As I now work in a school, I was hoping to spend this summer traveling again. I’ll keep looking for flights but will only book them if they are fully refundable.

Typically I’ll do a weekend here and there in Las Vegas. All M life and Wynn properties are closed. I wouldn’t be surprised if Caesars follows suit.

Unless things change, it looks like I’ll be grounded for the next month or more.

The State of the Airlines

I try to mostly avoid politics on SingleFlyer, but I’ll share my current musings on potential airline bailouts. Feel free to skip this part if you don’t want to get into it.

The airlines are seeking financial support in the US. Airplanes are flying nearly empty. Business travel is way down. The airlines are losing money each day that goes by.

Airlines are a crucial part of our national infrastructure. It is in everyones’ best interest that the airlines do not collapse and stop flying. However, there is a lot of space between bailouts and collapse.

Airlines have been insanely profitable over the past decade. Changes, such as baggage and change fees, the introduction of basic economy, and cramming in more seats have brought in extra revenue for the airlines. Company executives have taken home salaries that no one needs to earn. A ton of that extra revenue has gone to bonuses and stock buy backs instead of investing in employees, infrastructure, and saving for the next rainy day. This is pure capitalism; making the most money for stock holders as possible.

There are exceptions to this. Alaska Airlines paid out some of their profit to their employees. This is also good business and should be applauded.

However, that rainy day has come. Every ten years or so, a rainy day comes. It came on September 11, 2001 when the airlines were hit hard. It came again in the financial crisis of 2007. It came when oil prices went over $100 a barrel. COVID19 may prove to be the worst of these all — with airlines essentially being ordered to stop certain flights internationally.

So they ask the government for help. Here is my bottom line. Airlines can’t have it both ways. They can’t be pure capitalists during the good years and then cry for government funding during the bad times.

But the reality is that airlines are too big to fail. So the government will step in to keep them going, like the government did with the auto industry and banks in 2008.

However, it is time to re-evaluate how airlines are run if they are crucial to our national security and economy. The bailouts must come with strings attached. The airlines are in no place to negotiate; this is a time when the government has the upper hand and must negotiate any bailouts with that in mind.

The leadership and stock holders (yes, I’m included as I have investments) must feel the pinch. They must not be allowed to reap the huge benefits that will come in the future and not experience any of the pain. No one needs to make $13 million a year in a salary — sorry, not sorry, CEOs of Delta and American. Whether they should keep their job should be questioned. Absolutely no bonuses for a long time.
The profits must be better distributed. This means the ramp workers and flight attendants and pilots should all have receive the first line of bailouts so that they can keep their job. They should also be given more power in the decisions of the company. Seats on the board, stock ownership. Sick pay and livable wages.
The government must have more regulatory control of the airlines. Increase protections for the consumer. Limit fees. Regulate seat pitch. Take a page out of the book of Europe when it comes to cancelations and delays.

I doubt that these things will happen. But this may be a once in a lifetime (or at least decade) opportunity to make a real change so that we aren’t back here again in ten years when the next rainy day hits.

Feel free to comment below on how wrong or unreasonable I am. Or if you have other ideas, I would love to hear them. Just as my mind has evolved on travel this week, I would be happy to continue to evolve my thoughts on the airlines.