U P F R O N T

Cloudy Skies for US Airways<> ===========================
We began last week's newsletter with a cautiously optimistic take on the year ahead for mileage-collectors.

The outlook for the industry itself, and for 1 airline in particular, is decidedly less rosy.

It was a triumphant day for US Airways when it exited Chapter 11 bankruptcy protection on Mar. 31, 2003. Costs had been harnessed. There was cash aplenty in the corporate coffers. Labor and management were marching in lockstep, under the banner of "Work Together to Survive." Profitability was just over the horizon.

Most industry-watchers (myself included) applauded their achievement, taking the airline at its word that it had used the time in bankruptcy well, to reinvent itself as a scrappy competitor, ready to take on all comers.

It now appears the plaudits were premature. The airline's financial position is again precarious. And its labor relations are again in disarray.

Fact: US Air's pilots union has refused requests for further concessions and called for the airline's leader, David Siegel, to step down, questioning his leadership and management ability.

Fact: US Air's flight attendant union has filed suit against the company to block proposed layoffs. The union characterized the relationship between management and labor as hostile.

Fact: US Air has hired Morgan Stanley to help with the sale of selected assets, including the Shuttle service and 1 of its 3 hubs (Philadelphia, Pittsburgh or Charlotte -- most likely the former, in light of Southwest's plans to launch service there).

Fact: Last week, Standard & Poor's lowered US Airways' corporate credit rating, citing rapidly growing competition from low-cost airlines and the possibility of defaulting on a $1 billion loan.

US Air is in trouble. The nature and extent of its current problems suggest that the carrier did not reorganize sufficiently while in bankruptcy protection to insure profitable operations in the real world of smash-mouth airline competition. And its labor force is signaling that it is through capitulating to management's demands for salary cuts and productivity increases.

Stay tuned for what could be an ugly tumble back into bankruptcy, and beyond.

FrequentFlier Forum Topics
==========================
As always, there's plenty of activity on the FrequentFlier Forum.

TA has a link to Westin's Heavenly Beds sweepstakes. StumptownFlyer raises the thorny subject of selling miles on Ebay. J.Martin has details of Amtrak's 500-point reward for switching from paper to e-statements. And much more...

Do you have questions, answers? Post them to the Forum!

> More...

<< M I L E S & P O I N T S ~ sponsored by Hertz >>

Air Canada Backs Off Online Award Fee
=====================================
Air Canada was widely (and rightly) lambasted when it imposed a CDN$25 "service fee" on July 1, 2003, for Aeroplan awards booked through its call center. The fee was to be extended to bookings on Air Canada's website as well, beginning Jan. 1, 2004.

According to AC, the booking fee would "enable Aeroplan to increase redemption opportunities, introduce an even more efficient redemption process, make it easier to book reward travel, and much more."

The good news: AC has decided not to collect the fee for online bookings. In their own words: "Aeroplan is happy to announce that members can continue to use our online booking services without any extra Aeroplan service fee."

Fly Transpac to Earn Alaska Air Bonus
=====================================
Between Jan. 1 and Feb. 29, members of Alaska Airlines' Mileage Plan who take a qualifying trip on Northwest Airlines or KLM from Seattle, San Francisco, or Los Angeles to Tokyo or Amsterdam and beyond will earn up to 25,000 Mileage Plan bonus miles.

Earn 5,000 bonus miles for the first full-Y coach roundtrip, and 10,000 miles for the second, for a total of 15,000 bonus miles. And for business-class roundtrips, earn 10,000 bonus miles for the first, 15,000 miles for the second, for 25,000 bonus miles in total.

Registration is required.

> More...

American Express Will Increase Membership Rewards Fees
======================================================
Last month, American Express Membership Rewards members received notice of changes scheduled to take effect on Mar. 15, 2004. The announcement included the following:

"The fee to reinstate points forfeited for late payment will increase to $29 for each month of points reinstated.

"For Cardmembers who cancel their Membership Rewards enrollment (or all Cards enrolled in the program) but still have one Card account open, the time period to redeem accrued points will change from 6 months to 30 days.

"For each Corporate Card linked to a Membership Rewards account with another enrolled charge Card, the additional annual program fee will increase to $35.

"For each transfer of points into the Frequent Flyer program of a US airline, a fee of $0.0004 per point, with a maximum fee of $50, will be charged to your Card account. We charge this fee to offset the federal excise tax we must pay on such transfers. The fee may be more or less than the actual amount of the excise tax we pay on any individual transfer."

Of course it's that last change, buried at the bottom, that will most directly affect MR members. The new fee amounts to 40¢ for every 1,000 points redeemed. So the cost to convert 25,000 Membership Rewards points to 25,000 miles -- enough for a free domestic award ticket in most airline programs -- would be $10.

For comparison, Diners Club charges a $23.75 fee to exchange enough Club Rewards points for the same airline award.

Delta Matches AA Free Ticket Offer
==================================
Through Apr. 15, Delta is offering SkyMiles members 1 free ticket after 2 Delta or Song roundtrips between Boston or New York and selected cities in Florida or California.

As with the American promotion which prompted Delta's offer, the free ticket will be good for travel anywhere in the Delta/Song network, through Apr. 15, 2005.

A maximum of 2 free tickets may be earned for qualifying Boston flights, plus an additional 2 free tickets for qualifying New York flights. Registration is required.

> More...

Exchange Diners Club Points for More SkyMiles
=============================================
Between Jan. 1 and Mar. 31, 2004, Diners Club Rewards members will earn a 10% bonus when exchanging 40,000-78,000 Club Rewards points for SkyMiles, or a 25% bonus when exchanging 80,000+ Club Rewards points for SkyMiles.

Register online, then call 1-800-234-4034 to make the transfer.

> More...

Hilton Offers More Points Instead of Miles
==========================================
Reprising and extending a promotion from last year, Hilton is offering HHonors members a second earning option through Dec. 31, 2004: instead of the HHonors-standard Points & Miles (10 HHonors base points per eligible U.S. dollar plus 500 airline miles for most stays), members may elect to earn 15 HHonors points (a 50% bonus) but forego the airline miles.

To switch to the points-only scheme, visit http://www.hiltonhhonors.com/50percentbonus and follow the prompts. Those not opting to change will continue earning both points and miles.

United Offers Bonus for Online Award Bookings
=============================================
Between Jan. 1 and June 30, 2004, Mileage Plus members will earn 1,000 bonus miles for first-time award bookings on United's website.

> More...

United Extends Mileage Sale/Transfer
====================================
United has extended Mileage Plus Transfer Miles and the ability to purchase up to 25,000 miles through Mar. 31, 2004.

Using the Transfer Miles service, members can transfer miles to as many as 3 different Mileage Plus accounts for $0.01 per mile plus tax and a $25 processing fee. Miles may be transferred in 1,000-mile increments with a minimum transaction of 5,000 miles. Members may transfer a maximum of 15,000 miles to a single Mileage Plus member and up to 60,000 miles from a single account.

> More...

During the promo period, members may purchase up to 25,000 miles per calendar year for their own account or as a gift. The fee: $0.0275 per mile plus tax for transactions of 5,000 miles and under, or $0.0250 per mile plus tax for transactions over 5,000 miles, plus a $25 processing fee.

> More...

Check In at a Kiosk for US Air Miles
====================================
Through Mar. 31, US Airways is offering Dividend Miles members 1,000 bonus miles the first time they use a Self Service Check-In Kiosk to purchase a ticket or check in for a flight. Subsequent kiosk transactions will earn 50 bonus miles.

Offer is valid for travel within the U.S. on US Airways, US Airways Shuttle or US Airways Express carriers.

> More...

<< S T E A L S & D E A L S >>

Deal Alert from SmarterLiving.com
=================================
This week's hot deals from SmarterLiving.com...

Jamaica, Plus Free Caribbean Stopovers, from $274
-------------------------------------------------
Air Jamaica has announced sale fares to Kingston and Montego Bay, Jamaica, starting at $274 roundtrip. Travel is valid through May 23, and the airline is also allowing free Caribbean stopovers in either or both directions of your trip.

The free stopovers are allowed to anywhere in the Caribbean except for Jamaica; Bonaire or Curacao, Netherlands, Antilles; Nassau, The Bahamas; and Grand Cayman Island, BWI. Book tickets at least 3 days in advance, and by Friday, Jan. 16.

> More...

Sale Fares to Ireland from $198
-------------------------------
Fly to the Emerald Isle for less with Aer Lingus' sale fares starting under $200 roundtrip, not including taxes and fees. Travel from Baltimore, Boston, Chicago (O'Hare), or New York (JFK) to Dublin or Shannon, Ireland, starts at $198 roundtrip, or you can fly from Los Angeles for as low as $298.

This deal is valid for travel through Mar. 31. Book tickets online only. No specific booking deadline has been announced, so these fares could disappear at any time.

> More...

<< R E A D E R R A N T S & R A V E S >>

Feedback from the Frontlines of Travel
======================================
"The last issue of the Crier focused on all the recent improvements to various airline programs, but failed to identify more sacrilege by Air Canada. Elite fliers on Air Canada can all but kiss goodbye to their upgrades going into 2004 unless they pay full or very near full fare... this, in addition to earning only 50% mileage on all but the most outrageous fares. If Air Canada's desire is to prove to its frequent flyers that they are worth less each year, 2004 is yet another banner year for their stupidity.

"I am from the states and have been an elite flier of many airlines. Only since I accepted a job transfer to Canada 6 years ago, did I learn the pain of the Canadian flying community. Transitioning from OnePass Gold at the time to Aeroplan Elite was difficult, but it's staggering how much worse the Aeroplan program has gotten since then. This is what monopoly status allows in the Canadian skies. The government protects this former Crown corporation, effectively holding all Canadian fliers as hostages. The day that there is a choice, I will never fly Air Canada again. Isn't that a great testimony to customer loyalty from someone who has logged hundreds of thousands of miles on this airline?"

- Scott

"Hi!! Thanks for all the work you do for the Crier. Just a note to let you know though that I think you made a mistake with the AA/UA 10,000 miles in January then triple miles promo. You said that 'United has essentially matched American's first-quarter bonus promotion (see above)'...

"In actual fact this was United's promotion, which was matched about 3 days later by American. In light of the fact that United is going through bankruptcy, it's fairly significant that it made the effort first, and was copied by American, rather than the other way round."

- David

[Editor's Note - David is correct in every respect.]

Until next week...