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Business Travel Coalition Chairman Kevin Mitchell founded Business Travel Contractors Corporation (BTC) in 1994 as a corporate buying group to advance fundamental reforms to the airline industry ticket distribution system. As BTC chairman, he writes and speaks on airline competition, travel distribution reform and aviation system security.BTC was formed in 1996 as an advocacy organization to advance the interests of corporate buyers on government and industry issues.
Long flight delays, cancellations, lost baggage and rerouted flights. And it's just going to get much worse. Passenger growth is projected to mushroom from 700 million annually now to 1 billion by 2015. Kevin Mitchell, chairman of the Business Travel Coalition (BTC), says it's a mistake to think it'll take that long for a genuine crisis to arrive. "The reality is the U.S. commercial aviation system is today already in crisis and heading for political and economic catastrophe," he testified before Congress in 2007. He warned that the aviation system would become simply unreliable and eat deeply into the productivity of business travelers.
BTC and its members generally oppose new regulations. But the BTC, which says numerous problems are contributing to air travel woes and that the airlines are not taking the leadership role they should, is backing a novel approach to try to get the industry to clean up its act. Have government-funded researchers draw up "a set of well-vetted recommendations regarding solutions to systemic aviation system problems" and use them to write and pass new airline regulations, Mitchell said. However, there would be a catch.
The airlines would be given a chance to meet new standards before the regulations take effect. Only if it was determined that the airlines had failed to do so, would the law go into effect. That way, Mitchell said, the industry would be encouraged "to put energy and leadership behind a campaign to introduce sustainable, fundamental reforms to the industry before the nation seriously reconsiders re-regulating portions of the industry."
Mitchell told Congress that airport congestion pricing alternatives, operational meltdowns, appropriate compensation for customers who run into severe problems and government-mediated conferences between airlines on scheduling issues "are all areas requiring exploration."
POSTED BY: Timothy Skinner, A.A (April 25, 2008 09:27 AM)
Re-regulation of fares with a twist. The devolution of the industry is underway, but to prevent it from slipping further the concept of re-regulating the fare structures is needed.
Under the CAB days fares had a max and everyone differentiated themselves via providing a higher level of service to the paying passenger. Today, there is sufficient data available to establish a floor for fares based on route and aircraft being flown. This floor provides the foundation for carriers to use to assure they do not intentionally commit fiscal suicide.
Pricing freedom comes from the ability of the carriers to charge any price above the floor, but if customers are not satisfied with the service provided they will tell carriers with their wallet.
This action is necessary because the carriers often get so caught up in fare wars for one purpose - drive the others out of business. This idea will bring back the concept of customer service to an industry that was developed around providing a high level of service as shown in rider loyalty.
POSTED BY: RB (April 28, 2008 09:42 AM)
It's not quite accurate to imply the airlines are not already heavily regulated. Every aspect of the business is regulated and the carriers bear a lot of cost because of it. The only aspect that is not regulated would be the fares. Establishing fares that would allow the carriers to make profits is the only thing that will make a difference in the system.
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