Brown Bag Session Objectives

Increase awareness of travel industry trendsOverview of the University of Miami Travel DepartmentIncrease awareness of Travel Program Benefits

Travel DepartmentMission Statement

To continually enhance the University of Miami business travel program through promotion and education of available discount services to the end user in the fields of air travel, car rental and hotel rates

The Travel Industry& Future

Present

Past,

Travel PastFactors which impacted the Travel Industry

•Commission Change•First Self-Booking Systems•Economic Downturn

Commission Cut and Cap History

Travel Past

Prior to February 1995 Commissions paid to travel agencies:10% on the value of the ticket

February 1995 Domestic Commission Cap$50 Roundtrip $25 One-way 10% Commission

September 1997 Commission Cut from 10% to 8%Same Caps Imposed

November 1998 International Commission Cap$100 Roundtrip $50 One-wayStill 8% Commissions

November 1999 Commission Cut from 8% to 5%Same Caps Imposed

August 2001 Domestic Commission Cap$20 Roundtrip $10 One-way

March 2002 Elimination of Commission

Travel Past

First self-booking enginesLaunched in the late 90’sTravelocity - 97Expedia - 99Orbitz – 01

Online engines bypass traditional traveler/travel agent relationship making arrangements online for a fee at a fraction of the cost of the traditional agency fees

Travel Past

Introduction of Web Only Fares• Airlines began utilizing the Internet to

post discounted air fares to travelers on the web

• Fares were initially available on the airline websites and eventually on Internet booking engines

• These fares are not available through traditional travel agencies

Travel PastEconomic Downturn

The air travel industry lost in excess of 18 billion dollars over the past 2 years due to the September 11, 2001 tragedy (Source: www.cnnmoney.com)

Dollars Lost By US Air Carriers

American – 3.5 Billion DollarsUnited – 3.3 Billion DollarsDelta – 1.5 Billion DollarsUS Air – 1.4 Billion DollarsNorthwest – 1.1 Billion Dollars

* September 11, 2001 – January 31, 2003

Travel Past

UM travel was reduced 16% following September 11, 2001(September 01 – May 02)

Travel Present

• Acceleration in Online Travel Bookings• Airlines Implement Price Increases• Airport Security• Obstacles for Airlines

Travel Present

Despite the September 11, 2001 tragedy University travel for FY 03 has rebounded to levels above prior fiscal years

Industry vs. University Trends

• The industry has seen a 6% increase in online dollars spent from 2000 – 2002• UM has seen an 8% increase in online dollars spent during the same period

Acceleration in Online Travel Bookings

0

50

100

150

200

250

300

Dollars inBillions

1999 2000 2001 2002 2003E 2004E 2005E

Online Total Industry

OnlinePenetration

4% 7% 11% 13% 15% 17% 19%

Source: Orbitz.com

INDUSTRY TRENDS

UNIVERSITY TRENDS

0

500

1,000

1,500

2,000

2,500

1999 2000 2001 2002 2003 YTD

UM Agencies vs. Online

Online UM Agencies

4% 6% 11% 14% 16%

Dollars in Thousands

• Airlines Implement Price Increases

– Fees for paper tickets when an electronic ticket is available.

• $20 - $25 per ticket– Non-refundable fares radically changed

• “Truly non-refundable”

Travel Present

Airport Security Post 9/11On November 19, 2001, the President signed into law the Aviation andTransportation Security Act (ATSA), which established the new Transportation Security Administration (TSA) within the Department of Transportation. This Act established a series of challenging but critically important milestones toward achieving a secure air travel system.

Source: http://www.tsa.dot.gov

Functions of theTransportation Security Administration

• Responsible for civil aviation security• Federal baggage screening of checked luggage• Set guidelines for "prohibited items" that cannot be carried

on-board planes

Source: http://www.tsa.dot.gov

Items Prohibited in Aircraft CabinsAmmunitionAutomatic weaponsAxesBaseball batsBB gunsBilly clubsBlackjacksBlasting capsBows and arrowsBox cuttersBrass knucklesBull whipsCattle prodsCompressed air gunsCorkscrewsCricket batsCrow barsDisabling chemicals or gasesDynamiteFire extinguishersFlare pistolsGolf clubsGun lighters

  GunpowderHammersHand grenadesHatchetsHockey sticksHunting knivesIce axe/Ice pickKnives (any length)Kubatons Large, heavy tools (such as wrenches, pliers, etc.)MaceMartial arts devicesMeat cleaversMetal scissors with pointed tips Numchucks (nunchaku)Pellet gunsPen knivesPepper sprayPistolsPlastic explosivesPool cuesPortable power drills

  Portable power sawsRazor blades (not in a cartridge)Religious knivesReplica weaponsRevolversRiflesRoad flaresSCUBA knivesSabersScrewdriversShot gunsSki polesSpear gunsStarter pistolsStraight razorsStun guns/shocking devicesSwordsTear gasThrowing starsToy transformer robots (this toy forms a toy gun)Toy weapons

Source: http://www.tsa.dot.gov

Obstacles for Airlines

Operating losses

The U.S. Government provided in excess of 2 billion dollars to assist the airlines in 2002

Obstacles for Airlines

Airline Bankruptcy– United Airlines filed Chapter 11

on December 9, 2002– National Airlines closed its doors in November, 2002

Obstacles for Major AirlinesLow Fare Airlines

– Southwest Airlines – Jet Blue – Spirit Airlines – Air Tran

Low fare airlines offer competition on routes where major airlines charged higher fares

Business travel will decline further in 2003

Airline cuts will be permanent

Airport hassles are barriers

Internet Booking Options

Increased use of Low cost carriers

Projections for the Travel Industry

Source: Business Travel Coalition / Kevin Mitchell at the October 2002 SCTM Conference

AutomobileTrainBusLimousineLow-fare airlinesCharter jetsCorporate shuttlesCorporate jetsWeb castingWeb conferencingVideo conferencingTele conferencingEmailDigital visual conferencing

Alternatives to air travel for

business interactions

Travelers Have Choices

Source: Business Travel Coalition / Kevin Mitchell at the October 2002 SCTM Conference

Consolidation of flights

Substantial cost reductions

Business fare reductions - 25% to 30%

2003 Airline Industry Rebound WHAT WILL IT TAKE?

Source: Business Travel Coalition / Kevin Mitchell at the October 2002 SCTM Conference

Travel Department Overview

The Travel Department serves as a liaison

between UM departments, disbursements,

designated travel agencies, and the travel

industry. Saving travel dollars is important, but

improving service and providing new travel

benefits are equally important objectives of the

department.

Available University of Miami Travel Service Entities

• Authorized Travel Agencies• Hotels • Car Rental Companies• Airline Carriers

Authorized Travel AgenciesFour Seasons Travel(305) 577-9800Lorraine Travel Bureau(305) 445-7624Miami World Travel(305) 266-8080STA Travel(305) 284-8043The Travel Source(305) 663-3515

All 5 agencies accept the Direct Charge card (Ghost Card) as a form of payment.

Hotel DiscountsHotel Discounts

The Travel Management Department negotiates discount rates with various hotels both locally and domestically.www.miami.edu/travel

Local Hotel RatesCoconut Grove

Coral Gables

                         

             

Car Rental

Discount Rates are available from:

AvisAlamoDollarEnterpriseHertz

Rates are available online at:www.miami.edu/travel

UM Florida Car Rental RatesAlamo Avis Budget Dollar Enterprise Hertz National

University ID # BX 73457 B133484 BCD#V087652 UM0129 686026 CDP72125 5240953

Subcompact/Economy N/A $23.27 $28.99 $34.00 $25.99 $38.00 $38.00

Compact $32.00 $24.18 $30.99 $34.00 $27.99 $38.00 $39.00 MidSize/Intermediate $32.00 $26.01 $31.99 $37.00 $30.99 $40.00 $40.00

Full 2 door $36.00 $28.26 $32.99 $39.00 $32.99 $42.00 $41.00 Full 4 door/Premium $52.00 $28.26 $35.99 $39.00 $35.99 $44.00 $42.00

Luxury $58.00 N/A $52.99 5% off $56.99 $59.00 Minivan $58.00 $31.92 $49.99 5% off $52.99 N/A $57.00

Reservations 800 732-3232

800 338-8211

800 800-4000

305 556-7224 800 654-3131

800 527 - 0700 800 227-7368

Airline Carrier Discounts

The Travel Department has successfullynegotiated discounted rates with airline

carriersAmerican Airlines12% Discount

Continental Airlines7% Discount

* Negotiations are underway for additional discount possibilities for

the University

The University of Miami Travel Website

Center for Disease ControlUS State Department WarningsUS Department of TransportationTimes Around the WorldCurrency ConverterPassport Information

Travel FairTravel Talk & More…Silent AuctionMapquest.comWeather.comCar Rental RatesHotel RatesAnd more…

Current University information and links to important travel sources such as:

http://www.miami.edu/travel

Frequently Asked Questions

The Travel Website also contains a section which addresses Frequently Asked Questions

Q: What is the University’s standard mileage allowance for travel by private automobile?

A: The standard mileage allowance is 36 cents per mile. 

Q: What is the University of Miami’s Per Diem rate for meals?

A: Two Per Diem rates have been established:

Domestic Travel: $40 for a full day.

If the departure time is after 3:00 PM or the return time prior to 3:00 PM the traveler is entitled to $20.

International Travel: $50 for a full day.

If the departure time is after 3:00 PM or the return time prior to 3:00 PM the traveler is entitled to $25.

The per diem rate includes gratuities.  The meal allowance is paid only when the traveler is away from the local area (Miami-Dade and Broward counties) overnight

Travel Headlines

The Travel Website also contains a “Travel Headlines” page providing the University community a quick reference on travel industry news which directly affects the University of Miami 

 

DEPARTMENT OF TRANSPORTATION

UPDATE ON PERMISSIBLE ITEMS IN AIRPLANE CABINS

The United States Department of Transportation has updated their list of permissible items allowed in airplane cabins. An extensive list of items which are not allowed in airplane cabins can be viewed at the Department of Transportation website. The five page document details the changes which became effective on February 14, 2003.

Travel Payment Options

• Ghost Card• Personal Credit Card• Check

What is the Ghost Card?What is the Ghost Card?

The University’s direct bill option for Air travel which bills the department account directly

How to utilize the Ghost Card

Step 1: Request a copy of the itinerary for the airline

ticket from the UM Authorized Travel Agency Step 2: Attach an Itinerary to an executed

Travel Advance Request Form  Step 3: Fax the Travel Advance Request Form to the

UM Authorized Travel Agency

By utilizing the Ghost Card, the charge is directly

applied to the department and not the individual

Future of UM Travel Management

• Establish University travel booking website

• Continued use of Travel Agencies

University of MiamiTravel Booking Website

Website Features:Unique Username and Password accessAirline, Car Rental and Hotel accommodation capabilitiesFacilitate utilization of the Direct Charge CardDiscount fares negotiated by the Travel DepartmentAvailability of Special Web fares

Universities with Travel Booking Websites

Cornell University

Indiana University

Penn State University

Stanford University

University of Southern California

Travel Booking WebsiteInternet Booking Websites capture and post negotiated discount rates for Air,

Car and Hotel accommodations

Is there still need for a Travel Agency?

• Expert assistance on complex segments

• Group bookings

What Next ?

Travel alternatives Increased security charges Continued airline losses Probable reduction in airline capacity

Source: Bob Langsfeld & Bob Lichtman SCTM Conference October 2002

What Next ?

Less Travel Agent Dependency Shift in travel agency services

More corporate oriented More technology• Less agents• More online bookings

Source: Bob Langsfeld & Bob Lichtman SCTM Conference October 2002

Questions???

Travel Management DepartmentWhere is the Travel Department located?1507 Levante AvenueMax Orovitz Building Room 338

How can the Travel Department be reached?(305) 284-1087 phone(305) 284-3192 faxhttp://www.miami.edu/traveltravel@miami.edu