Seeing stars

The U.K. develops a single hotel rating system

A new star rating system for accommodations in England, Scotland and Wales is being phased in this year to help eliminate guesswork and confusion. The country’s motor clubs and tourist boards, which have had their own separate hotel ratings, will jointly develop a common set of standards for grading accommodations. Lodging establishments will be awarded between one and five stars and split into three categories: Hotel, Guest Accommodation and Budget Hotel (although budget chains will not be star-rated). Further, hotels will have five subcategories, such as Metro Hotel, Country House Hotel, Small Hotel and Town House Hotel. Guest Accommodation has six subcategories, including Bed & Breakfast, Guest House, Farmhouse, Inn and Restaurant with Rooms. Properties will be subject to annual inspections and full overnight assessments every three years. The new system should prove a boon for those traveling outside of London in particular. Meanwhile, London’s average room rates grew 4 percent to £101 in 2005 and are forecast to increase 7 to 8 percent this year.

Two runways are better than one

London’s Stansted set for big expansion

British airport company BAA has a $4.69 billion expansion plan for the U.K.’s fourth-busiest airport. London Stansted will get a second runway (ready by 2013), a new passenger terminal and control tower, and new parking facilities and roadways, subject to regulatory approval. Having two runways would increase Stansted’s annual traffic to 76 million in 2030, from 22 million passengers today. The airport currently handles 30 airlines serving 150 destinations. European discount carriers easyJet and Ryanair have bases at Stansted, while Air Berlin has a hub there. Meanwhile, all-business-class airline MAXjet has increased frequencies on its New York (JFK)–London (Stansted) route to daily service, and in late February was set to start flying five weekly flights between Washington (Dulles) and Stansted. It also plans to inaugurate a frequent flier plan called Customer Appreciation Program (CAP), with no blackout dates or other restrictions. MAXjet’s round-trip fares between JFK and Stansted sell for as little as $1,600.

Better times ahead

Losses could become profits for some airlines in 2006

There’s good news and bad news for the airline industry this year. First, the good news: Despite bankruptcy filings and high oil prices, some legacy airlines are expected to return to profitability in 2006 or 2007. Financial analysts have touted the stocks of American, Continental and US Airways, whose shares made substantial gains by the end of last year. Legacy carriers have benefited from radical restructuring, labor concessions and jet fuel prices that are 43 percent off their highs. Meanwhile, the stocks of one-time Wall Street darlings Southwest and JetBlue have leveled off, with not much room for growth, analysts say. The bad news? The world’s airline industry lost about $6 billion in 2005, according to the International Air Transport Association (IATA), on top of $36 billion in losses accumulated between 2001 and 2004. The group predicts the industry will be profitable in 2007, with a return of $6.2 billion and a net profit margin of 1.5 percent—“not even enough to cover the cost of capital and nowhere near recovering the billions lost since 2001,” the IATA said.

I’m locked in the bathroom, and I can’t get out!

“Senior suits” help engineers design aircraft cabins

While Boeing and Airbus duke it out for sales supremacy (see page 14), some interesting developments are taking shape in aircraft manufacturing. As the U.S.’s 77 million baby boomers pass age 60 and have more time, money and desire to travel, Boeing is researching how to make its 250-passenger 787 Dreamliner more “age-friendly.” Here comes the unflattering part: To impersonate senior citizens, Boeing engineers donned vision-distorting goggles and padded suits that restricted their movements. Then they tried to find seats, store luggage, adjust air flow and maneuver in the lavatory. Designers are experimenting with easier latches, more legroom, ergonomic seating, better signs and more spacious, well-lit lavs. The company wants to make airplane interiors more comfortable for seniors without making them look, well, “geriatric.” “If we don’t do something, you are going to have 60 percent of the population that can’t go anywhere,” a Boeing engineer told a TV news channel. And being grounded is no way to spend your golden years.

Boeing, by a nose

Manufacturers push new models

There hasn’t been a rivalry like this since the Hatfields and the McCoys. Boeing and Airbus are locked in a race to sell their new aircraft models to every conceivable buyer on the planet. The scoreboard thus far: Boeing, which has staged an amazing comeback, more than tripled its commercial plane orders to a record 1,002 for 2005, beating out Airbus for the first time since 2001 (though it was close) and going well above its own record set in 1988, when it acquired McDonnell Douglas. In particular, Boeing is promoting its 777, the new 787 Dreamliner and an even bigger version of its 747, while European-owned Airbus is pushing the A380 double-decker jumbo jet, which could conceivably seat up to 1,000 passengers, due to debut later this year. Airbus is also seeking a market for its mid-sized A350 (due in 2010), its answer to Boeing’s fast-selling, 250-to-300-passenger 787, set for delivery in 2008. May the best manufacturer win.

Reunited, and it feels so good

Hilton ponies up big bucks for global togetherness

Hilton Hotels Corp. is paying $5.7 billion to acquire U.K.-based Hilton Group PLC, reuniting the U.S. and international Hilton brands under a single corporate ownership for the first time in more than 40 years. Beverly Hills, Calif.–based Hilton Hotels owns, manages or franchises more than 2,300 properties. Hilton Group has about 400 international hotels under the Hilton and Scandic brands. The reunification will make Hilton more competitive in the global marketplace, particularly in the fast-growing Asian and Middle Eastern markets, as well as more effective against rivals Marriott International, Starwood Hotels & Resorts and Global Hyatt. Hilton sold the rights to its international brand in 1964. However, over the past decade, there’s been some reconciliation, with joint sales and marketing, centralized reservations and integrated loyalty programs. After the merger, Hilton said it expects to save $30 million in annual costs. In the U.S., Hilton operates hotels under its name, as well as the Hampton Inn, Doubletree and Embassy Suites brands.

In brief

How many people book flights on the Internet? At last count, about 400 million worldwide, said SITA Information Networking Company. The airline industry saves an estimated $1.2 billion a year by selling tickets online versus paying flight reservation fees … The “father” of the flagship 747 jet is telling his story. Joe Sutter, one of Boeing’s most famous engineers, has written an autobiography, due this spring through Smithsonian Books, a division of HarperCollins. The title of the 85-year-old’s book: 747: Creating the World’s First Jumbo Jet and Other Adventures From a Life in Aviation … Madrid was somehow selected as Europe’s first city to open a Hard Rock Hotel. The 192-room property will open this spring in the revamped Gran Hotel Reina Victoria. Spanish chain Sol Melia will manage the hotel, whose rooms will have a 32-inch plasma screen TV and CD-DVD, Wi-Fi Internet access and a laptop safe … Choice Hotels will open Stockholm’s largest hotel, the 558-room Clarion Hotel at Norra Bantorget square, in January 2008 … Starwood Hotels & Resorts will open its first W Hotel in China, a 400-room property in Shanghai’s Pudong financial district, in 2008.

It’s nice, but it’ll cost you

Got a transfer in your future? Consider your new costs.

At an annual price tag of $146,060, Manhattan homeowners pay 137.9% more than the national average.

The most expensive places to live*

City Annual Cost

Manhattan	$ 146,060
San Francisco	$ 133,880
Los Angeles	$ 117,726
San Jose	$ 108,506
Washington, D.C.	$ 102,589

Housing costs as a percentage of total living costs*

City Annual Housing Cost % of Total Annual Living Cost

Manhattan	$ 100,532	68.83%
San Francisco	$ 91,099	68.04%
Los Angeles	$ 75,898	64.47%
San Jose	$ 67,059	61.80%
Washington, D.C.	$ 60,583	59.05%

*Living costs include income taxes, costs associated with owning two vehicles (except in Manhattan, where owning two vehicles is less common), public commutation costs where appropriate (San Francisco and Manhattan), goods and services, sales tax, miscellaneous expenses and housing costs. Housing costs assume a 2,500-sq.-foot house (1,200-sq.-foot condo in Manhattan) in selected living communities where a $60,000 annual income family of four would typically live and include mortgage (principal and interest), insurance, real estate tax, utilities and maintenance costs. Source: Runzheimer International

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