Airlines are promoting buying frequent flyer miles for Christmas – Just say NO! –
This is the time of year the airlines will flood your inbox with offers to purchase frequent flyer miles as a great Christmas gift. Generally speaking, the offers that airlines make this time of year to purchase miles are not a good deal. The rule of thumb is that if you pay more than 2 cents a mile, you are paying too much for miles. For example, a domestic roundtrip ticket will often cost $250 to $400. It takes an average of 25,000 miles for a free ticket using frequent flyer miles. If you pay 2 cents a mile, that domestic ticket costs $500. Not a good deal. A normal business class ticket to Europe during the summer will cost you about 310,000 miles, which using miles costs @ 2 cents each or about $6,200. Not a good deal. However, if you are able to use frequent flyer miles to purchase a business class saver ticket to Europe using scarce “saver awards,” that requires 110,000 miles, and if you pay 2 cents per mile then you have a great value of $2200. That is a real good deal. The only way buying miles pays off is if you can use them for a business class ticket to Europe and find saver awards. Even then, you should make sure the saver awards are available on the days that you want to travel BEFORE you purchase any miles.
The Boeing 737 MAX is about to take flight, and I say it will be the safest airplane in the sky – Late this month, American Airlines announced they will fly a Boeing 737 MAX, from Miami to New York City. It has been almost two long years since the new airplane was grounded after two fatal crashes. After hundreds of lawsuits, allegations, investigations, testing, retesting, and finally recertification, the airplane will finally start a commercial flight this month. I don’t know all the details about the plane, but one thing I am absolutely sure of is this airplane will be the safest plane to ever fly. Boeing knows if it is not safe, it is probably out of business. CLICK HERE to read more.
Here are the two things that must happen before business travel rebounds – First, employees must return to their offices. Once you see people feel safe enough to go back into the office, you will start to see business travel start to slowly perk up. Secondly, meetings and conventions must move from “virtual” to “in person.” Unfortunately, I think many offices will not start to fill until the 2nd quarter of 2021, and conventions and meetings probably won’t “go live” until the 2nd or 3rd quarters of 2021. Unfortunately, business travel still has many months to go before the slow rebound gets started.
Vacation travel will have a major rebound starting in January after these three things happen – Obviously, having a vaccine will open the floodgates of the pent up demand. But it will still take several months to be able to have open access to the vaccine, so people feel confident to travel. Secondly, testing will also compliment the vaccine, and the combination of the two will make vacation planning explode in January for travel in late spring, summer, and fall of 2021. The third thing many people don’t realize is that many travelers who had vacations booked in 2020 and had their trips canceled because of COVID have millions of dollars of credit on the books of the suppliers that they will want to use as fast as possible. This will also be a springboard for travel bookings in 2021.
My gut tells me there will be a new PPP small business bill passed before Christmas – The CARES act passed by Congress this spring helped saved millions of jobs and small businesses this year. Unfortunately, those funds have run dry and many small businesses, especially in travel, restaurants, etc., are under extreme financial strain. My crystal ball tells me that before Congress goes home for the Christmas break, they will provide a new round of funding for the Paycheck Protection Program (PPP) that will be a lifeline to many small businesses and the jobs they provide. That would be a great Christmas gift for many people this year.
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