Yet the nation's airline industry continues to struggle, said Air Transport Association (ATA) Vice President and Chief Economist John Heimlich. "Higher traffic volumes should not be confused with profitability, especially against a backdrop of surging fuel prices," he said.
The rising cost of airfares, fewer flights to second- and third-tier cities, and the airlines' suspension of group-discount programs are creating difficult choices for planners seeking the best deals for meetings. "Airfare is now a much bigger concern than it used to be in selecting a location," said Christopher Greenslade, director of marketing and business development at Planning the Globe (PG), a Charleston, S.C.-based meeting and event services firm. "It's equal to, if not more important than, the price of the overall package of accommodations, meeting space and meals."
Joice Ventry, CMP, owner of Tallahassee, Fla.-based Meeting Spots, an independent full-service meetings management firm, said she has seen an increasing number of attendees who would normally fly to an event decide instead to drive‹in some cases saving money and time. "The prices are up and the number of flights from smaller airports has become more limited," she said. "Cities like Tallahassee used to be served by more airlines and offer more flights, but they have really cut back. I recently got stuck in Norfolk, Va., where they are experiencing the same situation."
While choosing low-cost carriers seems like a viable option to paying the high-priced airfare charged by some major airlines, there is a big tradeoff in the amount of time spent traveling, according to Greenslade. "The lower-cost tickets usually mean that a person will have to spend a whole day traveling, changing planes more often and experiencing longer layovers. For some people this makes for difficult choices and can even cause them to decide not to attend a meeting."
Because of the current state of the airline industry, some planners have been forced into a balancing act between deciding on travel time versus travel cost and juggling factors like flight availability, attendees' needs and other costs. As a result, some meeting planners say the best deal is to have attendees book their own flights.
Carriers such as Northwest Airlines indicated that its domestic flights could be reduced by as much as 15 percent in 2006, while American Airlines cut a number of roundtrip flights from hubs in Chicago and Dallas/Fort Worth after merging with America West in September.
Fletcher said many business travel managers are learning how to deal with the decrease in available flights. "Air travel managers keep a constant watch on these type of developments and adjust purchasing recommendations or policies as well as preferred provider contracts as appropriate. Right now, for example, some travel managers are pushing advance purchase to ensure travelers get the reservations they need as load factors rise. Preferred airline relationships are also coming in handy as planes are more full and changes are becoming more difficult."
Jennifer Smith, Planning the Globe's director of meetings, said booking flights into mid-sized destinations is more challenging than ever. "There are great medium-sized destinations that have hotel space and would attract attendees but tend to be out of budget due to air costs."
Smith, who has produced national and international meetings and events for various types of corporate clients for more than nine years, said dealing with airlines has become so complicated that her firm often outsources the task.
In some cases, this is because of modifications or discontinuations of airlines' group-rate plans. Carriers like US Airways and Delta Air Lines, as well as low-cost carrier Southwest Airlines, have reduced or discontinued their offers as part of their overall cost-cutting efforts. Delta made changes to its fare structure in early 2005 and ended its Delta Meeting Network program, which offered group discounts of 5 to 10 percent and special zone fares. However, the airline introduced Simplifares, a program that cut transaction fees, reduced ticket prices, placed caps on domestic coach fares and removed restrictions, such as Saturday night stays.
Some planners say the decreased availability of group discount programs has affected the way they make travel arrangements for their events. Greenslade pointed out that meeting attendees often travel from many parts of the country, which doesn't make it practical for him to choose discount programs that designate one airline as the official carrier. "Group discounts would be useful if you had a large group of people traveling together and wanted to charter all or part of a flight on a specific airline, but when you are planning a national meeting that pulls participants from many areas of the country, it's difficult to find a single airline that serves each area efficiently," he said.
Ventry said she is also dubious about the value of airlines' group discount programs and said that although she is sometimes able to get a special rate for a meeting, most clients don't ask her to negotiate a group airline rate. "I usually check with two or three airlines to see if there are any specials available, but many people prefer to work out their own travel arrangements."
Despite those complications, some airline industry officials are emphasizing that group travel programs are still available. For example, Continental Airlines revised its "MeetingWorks" discount program in 2005 to more closely match its corporate discount programs, according to Julie King, public relations director, who added that the program offers three tiers of discounts depending on the fare level and advised planners to book flights well ahead of their travel dates. "The best way to get good rates for airfare is to plan your meeting and book your travel as far in advance as possible to secure the lowest rates," she said.
