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November 12, 2006 Frustration Grows at Carousel as More Baggage Goes Astray By JEFF BAILEY ATLANTA, Nov. 6 — Since Aug. 10, when a ban on most carry-on liquids sent the amount of checked luggage soaring, airlines have been misplacing many more bags, and the fumbling could well escalate during the busy holiday travel season.
The Transportation Department reported that 107,731 more fliers had their bags go missing in August than they did a year earlier, a 33 percent increase. It got worse in September, with 183,234 more passengers suffering mishandled bags than a year earlier, up 92 percent.
Globally, about 30 million bags are mishandled each year, according to SITA, a company that sells software to airlines and airports for baggage and other systems. Airlines spend about $2.5 billion to find those bags and deliver them to waiting, often angry, passengers.
All but about 200,000 bags are eventually reunited with their owners each year — a number that sounds pretty high on its own, but that represents less than 1 percent of the billions of bags that are checked annually.
Efforts are under way to fix two of the worst baggage operations in the United States — at US Airways in Philadelphia and at Atlantic Southeast Airlines, which operates as Delta Connection here. Both airlines had scrimped on workers and equipment at these airports. But it is far from certain whether these hubs will be running smoothly by Thanksgiving.
Because of the relatively primitive technology used by airlines to track baggage, passengers typically only learn that their luggage missed their flight after a futile wait at the carousel. Then, travelers must hunt down baggage agents, fill out forms, and wait for hours or even days for someone, often unannounced, to deliver their bags.
Rhoda Frank of Chicago took her 12-year-old granddaughter, Bronwyn, to Manitoba last month for a vacation in which they hoped to see polar bears. Bronwyn flew on United Airlines from Raleigh, N.C., to meet her grandmother in Chicago, but her bag stayed behind.
The flight to Manitoba was not until the next morning, and United told Mrs. Frank the bag would be delivered by midnight. “It didn’t come,” she said. They flew north anyway, without Bronwyn’s long underwear or down jacket. The bag finally arrived, just before it was time to come home. In the meantime, “I scrounged for clothing,” Mrs. Frank said.
Airlines were generally misplacing slightly fewer bags this year until Aug. 10, when authorities in London foiled a plot to blow up airliners using liquid explosives mixed onboard. The liquids ban led to a roughly 25 percent increase in checked bags, which stressed some baggage operations.
Many of the bag-handling problems are because of the industry’s cost-cutting.
US Airways, twice in bankruptcy since Sept. 11, 2001, and then merged a year ago with America West Airlines, had a baggage meltdown at its Philadelphia hub around Christmas of 2004. Executives said they had known they needed to add people and equipment there. Some of that occurred. And through July of this year, fewer bags were going missing.
But with the surge of checked bags in August, the hub’s bag-handling performance began “backsliding,” said J. Scott Kirby, president of the airline. “A lot of balls in the air with the merger,” he said. “This one didn’t get done as well as it should have.”
Crews at Philadelphia, for instance, were short of equipment and fighting over the tractors — known as tugs — that they use to pull baggage carts.
“There’s a real lack of organization on the ramp in Philadelphia,” he added, where three-to-four times as many bags are misplaced as at other US Airways hubs.
US Airways is hiring 190 additional workers and 60 managers to fix the bag mess. The company is also buying more tractors, but is still about 40 short of its needs.
“We’re not going to fix the thing overnight,” Mr. Kirby said.
Regional carriers have been the fastest-growing part of the airline business in recent years, as they started flying some of the short routes abandoned by big carriers like Delta Air Lines. For example, Atlantic Southeast — which Delta sold last year to SkyWest, but which still operates as Delta Connection — carried twice as many passengers in 2005, 12 million, as in 2000.
When it was owned by Delta, which is operating under bankruptcy court protection, Southeast was denied the tractors, carts, computers and people it needed to keep up with its baggage — in Atlanta 30,000 pieces a day now. “When Delta sold us Atlantic Southeast, part of the reason was for us to fix some things,” said Jerry C. Atkin, SkyWest’s chief executive.
But over the last year, Atlantic Southeast has showed only modest improvement, remaining the worst bag handler in the Transportation Department’s rankings. And then in August its performance deteriorated again. Delta began complaining directly to Mr. Atkin, who installed new managers and agreed to hire 300 more ground workers and double Atlantic Southeast’s fleet of carts to carry baggage, among other equipment purchases.
“I got tired of being embarrassed by the numbers,” Mr. Atkin said. Now, he added, “there are some good people who have put their jobs on the line to fix things.”
One of them is Walt Kaurin, the new baggage performance manager, whose leathery skin shows his 24 years working outside on the ramp for Atlantic Southeast. Told of Mr. Atkin’s remark, Mr. Kaurin grimaced, explained his initial reluctance to become a manager, then, adopting a smile, said, “I was pretty confident we could fix it.”
It will take time. October mishandled bag numbers, not yet released by the Transportation Department, will again be poor for Atlantic Southeast, said Joe Kolshak, an executive vice president at Delta, whose own bag performance is highly dependent on the regional carrier.
Getting those 300 new hires up to speed will not be easy. “They’re minimum wage in many cases,” Mr. Kolshak said. “And there’s high turnover.”
Financial problems have slowed industry investment in technology that could improve bag handling. Radio frequency identification tags, in wide use among retailers to track inventory, would allow airlines to easily know if a bag did not make a flight. Then, the passenger could be warned via text messaging not to waste time at the carousel, and to call to arrange a delivery.
Not waiting for airlines, McCarran International Airport in Las Vegas is installing radio frequency readers and tagging all outgoing luggage. The tags cost about 20 cents each, but are worth it to a city that relies so heavily on tourists.
“If they have a bad travel experience, they’ll look at each other and say, ‘Wow, we don’t want to do that again,’ ” said Samuel Ingalls, assistant director of aviation.
Meanwhile, airlines can hope more travelers adopt the Zen thinking of Pamela Ingram, a Binghamton, N.Y., consultant who travels five days a week. She checks her bags, fearlessly. In the rare instances — once this year — of a tardy bag, she happily makes do.
“I got to go to my meeting in jeans,” Ms. Ingram said. “You can’t travel this much and expect everything to go right.”
Universal Express Announces First Quarter 2006 Improvements Monday November 13, 3:27 pm ET
NEW YORK--(BUSINESS WIRE)--Universal Express Inc. (OTCBB: USXP - News), announced today that its financial results for its first fiscal quarter ending September 30, 2006, have substantially improved over its September 30, 2005 first quarter. ADVERTISEMENT
The overall market capitalization of the Company increased to $60,075,056 for the 2006 first quarter from $4,182,310 for the 2005 first quarter.
Total stockholders' equity increased to $4,985,188 for the 2006 quarter from $695,464 for the 2005 quarter, an increase of $4,299,724 or over 700%.
The Company's working capital equity for the 2006 quarter improved substantially to a positive $117,301 compared with a working capital deficiency of $2,343,509 in the 2005 quarter.
Total assets increased to $7,598,046 for the 2006 quarter from $3,302,121 for the 2005 quarter, an increase of over 230%.
"Operationally, our developing subsidiaries still generate some paper losses due to fundings, marketing, branding and short selling pressures on those funding needs. Most paper losses do not indicate an actual operating loss. In fact, profitability has begun turning the corner months ago and future reports should crystallize the complete picture of our continued growth," said Richard Altomare, Chairman and CEO of Universal Express.
Revenues from the Company's logistics and international shipping businesses increased over 200% for the 2006 quarter compared with the 2005 quarter.
"We are pleased with the development and growth of all of our businesses. Revenues from our logistics and international shipping business have more than doubled for the first quarter compared to the 2005 first quarter, as they have in the previous five years, and we anticipate an exponential increase this year and in future years," concluded Mr. Richard Altomare.
About Universal Express
Universal Express, Inc. is a 22 year old logistics and transportation conglomerate with multiple developing subsidiaries and services. For additional information please visit www.usxp.com.
Safe Harbor Statement under the Private securities Litigation Reform Act of 1995: The statements contained herein, which are not historical, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements including, but not limited to, certain delays beyond the Company's control with respect to market acceptance of new technologies, products and services, delays in testing and evaluation of products and services, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.
Contact: Universal Express, Inc. Mark Falk, 561-367-6177 publicrelations*usxp.com
-------------------------------------------------------------------------------- Source: Universal Express, Inc.
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