Delta Has an Idea to Generate Revenue: More Bag Charges!

Bag charges. They're the worst. But here's some even more annoying news: they're going up!

Yes, that's right. Delta has decided that people traveling a really long way shouldn't be able to pack more than one bag for anything other than highway robbery, as they've raised their "second bag price" on international flights to a whopping $50.

Effective today, for international travel beginning July 1, Delta will charge customers a $50 fee to check a second bag, which the company expects to generate more than $100 million annually.

Well, goodie for Delta, who will make a ton of money. The downside: this is, um, not awesome news for consumers. The airline may have posted huge losses recently, but that's still not an excuse to seek awkwardly aggressive methods of charging consumers in an attempt to recoup some money. They're better off doing something counter intuitive like giving out free peanuts. I'd buy more airplane tickets.

Airlines Getting Better Report Finds

Airline performance is at a four-year high according to a recent study by private researchers. The study, which is based on government statistics, examines factors like the timeliness of flights, number of lost bags, and the percentage of passengers who file complaints to determine overall quality.

Of the 17 airlines researched, Hawaiian Airlines took first place, followed by Airtran Airways and Jet Blue. American, Continental, Delta and United were all in the middle with regional airlines filling out the bottom third.

The study found consumer complaints dipped from 1.42 per 100,000 passengers in 2007 to 1.15 in 2008. Southwest Airlines had the best rate, only 0.25 complaints per 100,000 passengers; US Airways had the worst rate, 2.25.

The average on-time performance last year was 3 percentage points better than the year before, yet nearly one-quarter of all flights were late. The study said 12 airlines improved from the previous year, but only three airlines had better than an 80% on-time rate: Hawaiian, 90%; Southwest, 80.5%; and US Airways, 80.1%.

American, the nation's largest air carrier as measured by passengers flown the most miles, had the worst record, arriving on time only 69.8% of the time.

Although airlines have made strides to improve customer experience, the reduced number of travelers has had the most significant impact in reducing lost bags and bumped ticket-holders. Aviation experts say the world's air transport system had reached capacity in 2007 (the year airlines did the worst in this study) and now, due to decreased travelers, things are starting to improve.

Dean Headley, aviation expert and co-author of the study argues that now's the to improve our air transportation system.

He urged Congress to take advantage of this "breathing room" to move forward on a system that would replace decades-old radar technology with satellite-based technology.

That new system is forecast to increase air transportation system capacity by enabling planes to fly closer together and more directly to their destinations, saving time and fuel.

"It's crazy to think we can keep going the way we were going with the volume of planes we have in the air," Headley said.

Seychelles Goes the Way of Iceland

Clear blue waters. White-sand beaches. Wealthy vacationers soaking up the sun. Seychelles has all of these things. Unfortunately, this tiny island country off the coast of Africa is also bankrupt.

This playground of the rich and famous is saddled with more than $800 million in debt, taking a page out of Iceland's "How To Destroy a Country's Economy" handbook. With sagging revenues from the country's two biggest source industries -- fishing and tourism -- Seychelles' debt is about the same as the country's total economy.

It's already defaulted on one $230 million loan and is now seeking relief from countries -- including the U.S. -- it owes.

"We borrowed more than we can repay," complains Ralph Volcere, the editor of Le Nouveau Seychelles Weekly and a vocal government critic. "This was wholly irresponsible."

In the hopes of boosting its tourism industry, the country is launching an "Affordable Seychelles" campaign with the motto, "Once-in-a-lifetime vacation at a once-in-a-lifetime price," in the hopes of drawing visitors. Affordable might be overstating it, but there are certainly deals to be had.

Delta Cuts International Flights by 10%

In a memo written by CEO Richard Anderson and president Edward H. Bastian, Delta announced its plan to cut international flights by 10% beginning in September of this year.

According to the memo...

...capacity this winter will be down 11-13% compared to winter 2008. Its trans-Pacific capacity will be down 12-14%. The cuts are in addition to Delta's December announcement to reduce 2009 capacity by 6-8%.

Delta currently has more than 70,000 employees world wide. Roughly 2,100 employees will be leaving the company voluntarily over the next year, but current projections show the company still may fall short of its fiscal goals.

Despite the cutbacks and meager projections, Delta is still taking a more conventional approach than some. Ryanair recently announced it may begin charging customers to use the bathroom.

Hurtigruten Offers the Deal of Lifetime

As mentioned earlier in the Farefinder...

If you've never been on a cruise, now would be a good time to consider it. At this point, it's old news that cruise lines around the world are offering amazingly low-rates to combat the struggling economy. However, Hurtigruten has just taken their rates to newsworthy lows.

Hurtigruten has unveiled a program on two of its 2009 Greenland cruises that offers an all-inclusive approach and savings up to 68%. The "Pay One Price" deal is available on all suites and staterooms on the 318-berth Fram, a deluxe expedition ship, for the season's two one-way sailings.

Suites, normally $16,676 to $20,366 per person, double, are being priced at $5,499 to $7,249, while staterooms, normally $12,536 to $15,716, are $3,999 to $5,249. Suite bookings include two optional excursions; wine, beer or soda at meals; and a bottle of Champagne. The booking deadline is March 31.

Although Greenland might not be the exotic destination you'd always imagined, travelers can count on beautiful scenery and luxurious accommodations. Plus, with all the money saved in the process, you can make a pretty respectable offer to buy Iceland during the stop over in Reykjavik.

Tips for traveling in a bad economy

Ramsey Qubein is Travelin' Light's on-the-road correspondent.

If your travels follow the direction of your bank statement, then read quickly and look South. The economic instability of the United States is not isolated to this great land. Over the past few weeks, the long-inflated Euro (to the dollar) has softened providing an ease on the pocketbook for American travelers while the Southern Hemisphere has become an amazing bargain seemingly overnight.

But, there are other destinations that provide more bang for the buck. While they require a bit more effort to reach, they can prove to be big money savers once one arrives. South African Airways and Delta Air Lines both fly nonstop to the African continent and frequently offer discounts (especially from Washington DC and New York where the competition is intense). South America often sees deals emerging from New York and Miami among other cities.

South Africa is the perfect example. As I write this post, the rand is 10 to the dollar, providing an incredible value. We’re talking an entire steak dinner (including an obligatory South African Meritage) for under $10!!! Add up local transportation costs, local hotel rates, and souvenirs and you arrive at a reasonable figure that competes with a European vacation while offering the cache and distinction of a more exotic locale. Imagine perusing the safari lands outside Johannesburg or strolling the V&A Waterfront of Cape Town for only a fraction of the cost. Now is the time to go.

Try a side trip to Namibia for the day or even for a few nights. The local currency is equally priced, and the locals are amazingly welcoming.

Another locale is the incredibly romantic confines of Buenos Aires where the economic instability has yet to catch up leaving prices severely undercut for the American traveler. The Australian Dollar is similar with record lows to the dollar equaling huge savings for Americans.

Even sunny Aruba has gotten in on the action with discounted fares and creative packages to lure Americans closer. They count on almost 70% of their inbound tourism as Americans meaning that when the USA has a cold, Aruba can quickly develop pneumonia so look south for vacation plans this year!

Iceland Government Resigns

Iceland's Prime Minister Geir Haarde announced the resignation of his entire cabinet on Monday, January 26th. The announcement comes after months of protests and demonstrations in which the Icelandic people accused the current government of leading them to financial ruin.

Iceland's financial system collapsed in October under the weight of debt built up during years of rapid growth.

The currency has since plummeted, with unemployment soaring. The economy is forecast to shrink by 9.6% this year.

The prime minister said he would speak to Iceland's president to formally dissolve the government.

Haarde's intent to resign had been made clear last week when he scheduled an early general election for May 9th. He said because of health reasons, he would not be running for re-election.

Foreign Minister Ingibjorg Gisladottir's Social Democratic Alliance is expected to find a new partner to form a government until the elections can be held. Traditionally, Iceland has tried to stay outside of the European Union, but some sources suggest they could apply for membership within the year.

Although the resignation will further Iceland's short-term economic woes, it will make tourism to the island-nation even more affordable. As of this morning, 1 USD was equivalent to 169 Iceland Kronurs. You know what that means... discounted lodging, cheap spa treatments, and all the rotten shark flesh you can eat.

United Sells Planes to Raise Cash

Airlines, among many industries, have struggled with cash flow problems since the economy began roiling early in the year. While many companies have turned to downsizing, cancelling programs or reducing inflated corporate salaries, United Airlines has taken a different approach.

In a move to increase the airline's cash flow, United has sold 15 Boeing 757s to East Shore Aircraft for $150 million.

United will lease the planes back from East Shore, continuing to operate and maintain them.

Although other airlines have not yet gone as far as United (i.e. selling planes), they've all made strides in 2008 to increase their liquidity in anticipation of reduced air travel. So far, they're predictions have been accurate and their preparations have paid off with airlines across the board reporting significant slows in traffic throughout October and November.

While no one wants to think about splurging at a time like this, the fact is, there's no better time to travel. Airfare, which is usually one of the most expensive parts of any vacation, should slowly fall with decreased demand. Last-minute deals to major cities in the U.S. and overseas should get even cheaper and more frequent. Additionally, the economic trouble in Europe has allowed the dollar to regain some of it's lost value. So before you write off a 2009 vacation, consider that it may be the most affordable time to travel in the past several years.

Mirage Unveils New Fake Volcano

Although 2008 has been an increasingly tough economic year for hoteliers everywhere, the folks at the Mirage are still shelling out big bucks. The Las Vegas resort reportedly spent $25 million on a brand new fake volcano. The feature was unveiled Monday evening before a crowd of fake volcanologists.

The redesign is the work of WET, creator of the fountain attraction at the Bellagio. WET's new fire-shooting spectacle at the Mirage is accompanied by a soundtrack composed by Grateful Dead drummer Mickey Hart and famed Indian
percussionist Zakir Hussain.

While the drums beat, fireballs shoot more than 12 feet into the air, "lava" flows down the mountain's fissures and "eruption ignites the surrounding lagoon," said the Mirage.

Hart calls the result a "true union of the senses that will rattle your bones, just like a
real volcano."

The new volcano is just one of example of how tourists and Las Vegas can both win at the same time. As the Strip continuously makes efforts to revitalize itself, fans of Sin City are perpetually greeted with new resorts and attractions. A constant focus on reinvention has made Las Vegas one of the most dynamic tourist destinations in the world. While some cities may lose their charm, and natural attractions wear away and are torn down, you can be sure there's always something new in Las Vegas.

Maybe the Former Days Inn Owner Can Help the Economy

The former owner of Days Inn, Stanley Tollman, has run into a little bit of the old good news - bad news business with the IRS recently. The good news is that he only had to plead guilty to one count of tax fraud. The bad news is that one count is going to cost him $105 million.

Stanley Tollman, who as a principal of Tollman-Hundley Hotels was once an owner of Days Inn of America, pleaded guilty to one count of tax fraud and agreed to pay more than $105 million to the government in back taxes and various fraud penalties.

Under terms of the plea agreement with the U.S. attorney for the Southern District of New York, other charges of bank fraud against Tollman and tax fraud charges against his wife, Bernice Nina Tollman, 77, will be dropped.

The couple have spent the last few years living in London fighting extradition, but the English courts this year would not allow extradition of either Tollman, citing Mrs. Tollman's health.

Or perhaps becaue Mr. Tollman was greasing wheels. Or whatever. The point being is that our government is getting another $105 million! What should we do with it? Weeeeeell, we could line the coffers of the rich; that seems like a good idea. Or just let the IRS sit on it.

Or ... or ... and I know this sounds like kooky-talk, but hear me out -- we could always take this money and distribute it equally across all citizens. It won't be much -- a dollar here or there, but since the economy is kind of tanking, it would be cool to see everyone get a little something for a guy that doesn't ever have to work again despite cheating the government out of nine figures.

The Grass is Greener on the Danish Side

I'm sure you've heard the old cliche, "the grass is always greener on the other side. " Well, apparently there are some places where it's actually true. Despite the dreary weather, betrayal, adultery, ghosts and murder that are usually associated with Denmark (if you haven't read Hamlet, never mind), it actually might be the happiest place on earth. 

According to a survey conducted by Leicester University in England, Denmark boasts the happiest people on Earth, and in these gloomy economic times, tourism officials are betting that visitors could use a little of that cheer.

One reason for the pervasive contentment, which the Danes call hygge, is the quality of local restaurants, hotels and shopping.

We've said in earlier posts that if you can afford it, now is a great time to be traveling. Besides the excellent dining and shopping, there's also beautiful art and architecture. After all, Copenhagen is nicknamed the "City of Beautiful Spires." So hop on a plane and head for the old world, apparently happiness is just a seven-hour plane ride away.

FareFinder news Extra: House of Mouse not immune to troubled economy

Normally FareFinder is a Tuesday/Thursday thang, but I saw this lil' nugget on the PTG news desk and shed a small, but ear-shaped, tear:

The hotel industry is following in the footsteps of the plummeting financial markets, with rates diving 3.5% the first week of November and occupancy and room revenue tumbling in double digits. ... What that means for travelers is
lots of great deals. ... Disney World is giving away three free nights with the purchase of four.

The Mouse is also offering free admission to guests on their birthdays in an attempt to draw guests to their plethora of hotels and theme parks. These are the types of things that happen when you're down 10% in bookings in the first half of '09 compared to the previous year.

But not all is doom-and-gloom for The Mouse. Theme park revenue at the hap...hap...happiest place on Earth was up last quarter and The Mouse is still a Wall Street darling in many eyes. As The Motley Fool says, "Disney is built to weather the storm."