AA, SW Agree To Support Wright RepealAmerican Airlines, Southwest Airlines and the cities of Dallas and Fort Worth last week finally unified to seek legislation to repeal the Wright Amendment—a highly contentious piece of legislation from the 1970s that promoted a then-fledgling Dallas/Fort Worth International Airport while restricting air service at crosstown Dallas Love Field. The parties have reached a number of compromises, AMR Corp. CEO Gerard Arpey said, that are being drafted into proposed legislation to be presented for congressional approval. Southwest CEO Gary Kelly said the legislation "will allow us to reinvest in Dallas Love Field, our hometown airport; and it will allow us the opportunity to grow."
Sabre Plans Traveler TrackingSabre is in the midst of developing a series of new capabilities for travel agencies. Most significantly to corporate travel buyers, Sabre is beginning development of traveler-tracking tools for agency and corporate customers. Although Sabre Travel Network senior vice president of North America Chris Kroeger could not give a timeframe for release, Sabre will build new tracking systems that can serve either as a turnkey—for agencies without such a system—or a complement, for those that have developed their own. "Providing traveler-tracking capabilities, if done properly, levels the playing field and may marginalize those of us who have made proprietary investments into such products," said John Smith, president of Chicago-based travel management firm Tower Travel Management.
Hotel Labor Contracts Set To ExpireHotel labor contracts set to expire in many major U.S. cities this summer have prompted labor union officials to aggressively negotiate for higher worker wages in the face of robust profiting by hotel companies, which is expected to reach $25 billion this year, according to PricewaterhouseCoopers. Contracts expiring in 2006 include New York and Hawaii on July 1; Chicago at the end of August; and Boston and Los Angeles at the close of November. Contracts already have lapsed in San Francisco and Toronto. Unite Here, which represents approximately 90,000 full-service hotel workers in the U.S. and Canada, is poised to face off against the top hotel companies, particularly Hilton Hotels Corp., which employs approximately 35,000 U.S. full-service workers. At issue are wages and, in some cases, hotel companies blocking workers from organizing unions. John Mazzoni, vice president of national labor relations for Hilton, countered that there was a 90 percent satisfaction rate among Hilton employees. "Hilton pays competitive wages," he said.
UAL Making Deep Cuts To WorkforceUAL Corp. CEO Glenn Tilton last week at the Merrill Lynch Global Transportation Conference said the carrier by year-end would slash at minimum 1,000 "salaried and management" positions. Tilton said the move is part of a larger cost cutting initiative to reduce costs by $400 million. That includes cuts to advertising and marketing by $60 million and cuts in purchased-service costs—telecom, catering, maintenance material and ground handling—by $200 million. Tilton said United Airlines is "reducing general and admin overheard expenses by some $100 million, and as a part of that initiative, we'll be eliminating at least 1,000 salaried and management positions out of approximately 9,400 by year end." Tilton also said the carrier would increase "operational efficiencies" to generate $40 million in savings. Such efforts include developing a new flight planning system, reducing block time and "better matching product delivery to customer needs." The carrier also said it soon would reveal its international premium product. United, like other carriers, has spent recent years rethinking strategy, cutting costs and generating revenue
(BTN, Jan. 23). In addition to revenue jumping 6 percent last year amid higher capacities and fares, the company said it also expected cost-reduction initiatives to yield $7 billion in savings annually by 2010.