Business Travel Briefing
For July 30-August 13, 2020
The briefing in brief: Homeland Security admits it lied about Global Entry and a federal judge is furious. Is it safe to fly? Two studies offer some useful data. The hotel chains are dealing with large groups of unhappy property owners. New York/LaGuardia opens new gates next week. ExpressJet folds. And more, including the daily Coronavirus update.

Your mileage may vary on what's been happening in Portland, but this much is indisputable: Homeland Security, the agency in charge of those camo-clad federal "police," has lied so consistently in a New York court that a federal judge thinks the agency may have engaged in fraud. As you recall, Homeland Security in February abruptly banned New York residents from Global Entry. In many subsequent documents, acting Homeland Security secretary Chad Wolf claimed that a New York law shielding motor-vehicle records was unique and so restrictive that Homeland Security could no longer allow state residents into Global Entry. New York and the ACLU promptly sued. Skip ahead to last Thursday (July 23) when Wolf abruptly issued a press release reinstating New Yorkers because he claimed the state had amended the offending law. Yet even as Wolf was issuing the press release, the Justice Department wrote an extraordinary three-page letter to U.S. District Judge Jesse Furman. It withdrew all of Homeland Security's claims about New York--and even bluntly contradicted Wolf's claims in the new press release. The letter said the Justice Department and Homeland Security "deeply regret the statements and apologize to the courts." (Worth noting: The letter was signed by acting U.S. attorney Audrey Strauss, the official Attorney General William Barr tried to bypass last month when he fired Geoffrey Rosen as New York's top prosecutor.) Judge Furman reacted furiously yesterday (July 29) during a hearing on the matter. He demanded Homeland Security submit a "comprehensive record of any and all 'inaccurate' or 'misleading' statements." He also wants anyone responsible for Homeland Security's lies be identified. The court, Furman added, "has the power to conduct an independent investigation in order to determine whether it has been the victim of fraud." Another hearing on Homeland Security's conduct and any Justice Department complicity is scheduled for August 12.

Nearly 80 percent of us have been off the road since the pandemic began and, despite repeated airline assurances that they are running a clean and sanitary operation, many remain reluctant to fly. The obvious question: Does the simple act of flying increase your risk of contracting the Coronavirus? I'm not a doctor and I don't play one here in Tactical Traveler, but I can point you to two useful studies on the matter. The first convincingly shows that keeping an empty middle seat next to you will substantially reduce your chance of infection. (So, you know, flying American or United should be off the board since they won't guarantee one.) The second study is more chilling. It shows how easily the virus can spread on a plane when a passenger is infected. It tracks the spread of the disease among passengers on a January flight from Singapore to Hangzhou, China. If these studies convince you not to fly, console yourself with the reality that there's really no business travel to do, no decent international destination will have us and lots of things are closed.

The pandemic's crushing impact on travel--$320 billion worldwide in just the first five months, according to the World Tourism Organization--is likely to cause a massive upheaval in global lodging. Although brand flags are well-known to us, travelers know little about the actual hotel owners. And large groups of hotel owners are chafing over the terms of their current contracts with the major chains. Example One: Service Properties Trust (SPT), which owns more than 100 hotels flying flags aligned with InterContinental, is threatening to move most of them to the Sonesta chain. SPT claims InterContinental hasn't been living up to its payment promises although it must be noted that SPT also owns 34 percent of Sonesta. Example Two: Across the pond in Britain, a group of Travelodge owners have banded together and they plan to defect to the Ibis brand operated by Accor Hotels. The owners have been arguing over contract concessions with Travelodge UK, owned by Goldman Sachs. "You're going to see lots of power moves," one hotel owner told me this week via E-mail. "Many owners are in bad contracts and will try to switch brands for a better deal." In other words, be prepared for lots of chaos in the lodging landscape.

With way more pomp and circumstances than the times deserve, New York officials opened the first phase of a new Terminal B at LaGuardia Airport. Seven gates will go into operation next week and be primarily dedicated to American Airlines flights. It's the second major improvement at LGA in two months following the opening of the new Arrivals and Departures hall. The new gates will be supplemented by 10 more in 2022. The airport also claims that 75 percent of roadway work surrounding terminals is now complete. You are guaranteed to be using the other 25 percent, of course, because the pandemic hasn't changed the reality of business travel.
        Portland, Oregon, is losing an iconic retailer. The Powell's Books outlet behind the airport's ticket counters has closed permanently. The Portland-based bookseller has five other shops around Oregon and they have been closed, but the chain claims their closure is not permanent.

Say goodbye to ExpressJet, a United Airlines commuter carrier. Once owned by Continental Airlines, ExpressJet was sold off, eventually became a part of SkyWest Airlines and most recently had United as a minority partner. In recent years, ExpressJet has operated only 50-seat jets, but United said today (July 30) that it was moving all of that business to CommutAir. ExpressJet had no other clients, so it is shutting down at the end of the year.
        KLM discriminated against a woman forced to move when an Orthodox Jewish man refused to sit next to her. That's the decision of a Dutch civil-rights organization. The incident occurred on a New York/Kennedy-Amsterdam flight last year and the Dutch rights group said KLM erred by moving the woman against her will to accommodate the man's religious objections. A similar incident on an El Al flight in 2017 led that carrier to change its policy.