The Brazilian Fantasy

The recent sideswiping of an Embraer corporate jet and a Brazilian GOL 737 over the Amazon rain forest was tragic—the worst airline crash, with 157 passengers killed, in Brazil’s long history as an aviation-friendly country. Now, it definitely looks as though the two American pilots of the Legacy 600, which they maneuvered to a safe landing at a military base, were kept in isolation, without passports, for two months as scapegoats for Brazil’s fouled-up air control system.  It was all politics, Brazilian-style.

 

In a country that has upgraded its economy and social system in the past 50 years, it looked like a reversion to Third World status. With a presidential election pending, the two pilots were easy targets to divert the public’s attention away from the ad lib confusion—often amusing—that defines much of Brazilian life and its government.

 

Airlines are something most Brazilians know well—in a country literally the size of the United States where flying is a lot faster than cars or trains for getting around. With its hilly, if not mountainous, coastline the country never found its way inland by train, as the president of Varig, for decades one of the world’s best airlines, told me years ago, noting that this was quite different from the way railroads opened frontiers in most other developing countries. “We ended up inventing airlines and flying over the coastal barrier,” he said. And Germans who always liked southern Brazil for its Bavarian-like landscape and climate helped Brazilian airlines keep abreast of aircraft technology.

 

When Brazil decided to build a new capital away from the pleasure palaces of Rio, it chose a site 600 miles west in cattle country, let super-star architect Oscar Niemeyer design it in the shape of an airplane, called it Brasilia, and hoped it would be a magnet to draw Brazil’s proliferating population away from the coast.  (It did, but way below projections. Who would forsake the good life of Rio for the saloons in Brasilia’s cowboy country?) To meet construction deadlines at the capital city, President Juscelino Kubitschek favored air transport over train transport. In a crazy, costly logistical ploy, the government requisitioned commercial passenger planes to fly major steel beams and other building materials to the capital.

 

Brazil gets away with things like that because Brazilians are basically optimists, counting on “progress” to make up for their sin of loving the samba, lambada and thongs. They’ll mutter, in Portuguese (of course), “The future is Brazil” to excuse away whatever is ailing the country, from Rio’s slums to corruption in high places.

 

            In the early 1950s, when dictator Getulio Vargas returned to power with a military coup, only in Brazil would you see tanks stopping for red lights as they plowed through Rio’s streets. It wasn’t long afterward that the denizens of Sao Paulo, Brazil’s L.A., put a rhinoceros on the ballot in disgust to protest election fraud. (And Brazilians have a knack for commonsense solutions to tricky problems: If your car hit a pedestrian, they used to say, throw your car into reverse and make sure the victim was dead to eliminate testimony in a trial—or just duck out of sight for 24 hours and you’d get away with it.) 

 

That’s the kind of wiggle-waggle justice that came into play with the house arrest of those two Legacy 600 pilots. For business travelers hedgehopping around the world, the lesson is: Watch out! You too can turn into a scapegoat.   

 

Airline 101: M&A

This should be a vintage year for M&A bankers and lawyers who like to mix and match airlines. US Airways’s takeover of America West followed by its $8-billion “hostile bid” for Delta—and then United’s and Continental’s love-in—is a Hollywood scriptwriter’s plot for a bigger-is-better airline industry. And clearly inspired by US Air, a forlorn Northwest—in bankruptcy protection—has hired a smart investment bank, Evercore, to join its search for the right partner.  

 

All of this late-2006 action is the real jump-start for the inevitable consolidation of an industry overloaded with duplication of routes and services. Is 2007 the banner year for action instead of nasty talk?

 

Airlines, while looking out for themselves, would like to fly you everywhere without putting you through those nerve-wracking, time-consuming connections.  It’s simply good marketing. Think nonstops like the 12-to-18-hour nonstops from

U.S. cities to Pac Rim destinations. 

 

Are mergers such a big deal, beyond the headaches of making oranges and apples coexist in the same basket? Mergers simply amount to a major (and painful) upgrade from code-sharing. Those union obstacles? Every merger has a job-culling problem—think of the layoffs at GM and Ford. Is the resistance coming from executives whose egos and take-home pay are potentially bruised in a merger? 

 

What’s the strategic combo in each airline situation? For instance, Delta has upped its value, stating with utter hostility that it has a value of up to $12 billion instead of US Air’s $8 million offer and intends to exit bankruptcy (a condition that would make it easier for US Air to take care of the union problem).

 

In another scenario, could it be American, Continental or Delta, all with firm footing in the South, that would complement Northwest’s northerly orientation and Midwest hubs in the Twin Cities and Detroit? Airline consultants like Bill Harrell of Harrell Associates point to Northwest’s lucrative trans-Pacific routes as bait to interest other airlines that are out shopping. Talking about opportunities,  Delta’s international routes in the other direction—to Europe where it acquired routes to nearly a dozen cities from the Pan Am sale years ago—could be an alluring plus. 

 

Why has it taken this long to get bankrupt carriers to the altar? There’s hardly an industry that hasn’t gone through a merger and acquisition phase—with the big getting bigger for reasons of market share and operating efficiency. Haven’t airlines been reading the newspapers or Web sites? You can hear the anti-merger crowd complaining about monopolistic merged meanies (get that alliteration) lowering competition on routes and spiking fares.

 

It’s a tired tale—a last-ditch worry that might lead the Justice Department to block mergers, if it were the ‘80s and ‘90s. But think of it in today’s terms: Isn’t there sufficient competition from the discounters—Southwest, JetBlue, AirTran, Spirit and Frontier—to keep a lid on fare spikes? And haven’t the majors—give them a break—learned something themselves about discounting? 

 

Maybe the legacy carriers will be whittled down from six to four this year—and a good thing. And unless they want to create a furor from business travelers, they’ll have to blend frequent-flyer programs deftly to avoid losing their most loyal supporters.

 

The transition may be dicey, but meanwhile the carriers just might clean stale food and candy wrappers out of the seatback in front of you.

 

Registered Ego Massage

Good for Steven Brill, an entrepreneur at heart who made a big mark in the clubby world of top law firms by telling all in his long-ago legal column in New York magazine, then a hot read, and decades later wants to legitimize line-jumping at security-neurotic airports. Orlando, his year-plus first experiment, has raised the spirits of members willing to pay $100 for fast biometric approval to speed past the TSA police. And now, after spooling much red tape, his Clear program is getting a welcome at JFK and several other airports nationwide.

 

But is the applause from members due to the time saved and reduced hassle? Or is it a Freudian thing about a small class of people outmaneuvering the mass market of travelers? In short, is it the same as flying First Class versus Coach? With the savings in time minimal? Really a revenge thing? You can say that it sure makes you feel better to keep your shoes on as you prepare to board.

 

Track to Tibet

 

On your next business trip to superpower territory—China or India—carve out some extra time for a side trip to Tibet, the remote Buddhist kingdom in the Himalayas now under Beijing’s big thumb. Instead of flying Delhi, Calcutta or Beijing to Lhasa, Tibet’s capital, with a stop or plane change in southwestern Yunnan Province of China, take the train.

 

“You must be kidding.” you say. “No, dummy,” the informer barks back.  “The Chinese built the Great Wall centuries ago, and now they’ve sweated through the construction of a railroad all the way from Beijing to Lhasa at a cost of billions of yuan and the lives of many workers. It goes stratospheric—sections of the rail reach an altitude of 16,000 or so feet, high enough for an Everest kind of base camp. The trains are OK, nothing fancy with cramped bunks and seats, typical Chinese. And if you love bridges, you’ll like the trip filled with spans across gorges and canyons and rivers. And you do get there—to the stunning city of Lhasa with brightly colored robed monks and humongous palaces looking as though they’d slip down the mountainside. But,” he warns, “get there soon before the Indomitable Adventure Tourist takes over.”

 

And now it’s easier than ever, with the opening of two more rail routes from Shanghai and Guangzhou (Canton). Trains make the journey every two days and take 51 hours from Shanghai and 57 hours from Guangzhou. Not bad if they can hold to that timetable for a two-day-plus rail journey.  

 

Desert Mirage

 

Dubai, the manmade mega-emirate on the microwaved Persian Gulf, is beginning another year of spectacular Disney-inspired projects by opening the first of three palm-tree-shaped island getaways called the Palms. Frequent business visitors to Dubai—rich Iranian jet-setters among them—are purchasing the Palm condos as if they were a new Riviera. (The heavy concentration of “influential” Iranians, in-and-out visitors or expats, has led the U.S. government to establish a listening post in the emirate to make up for the lack of an embassy in Iran’s capital of Tehran.) 

 

Dubai’s works in progress, under the benevolent whip of ruler Sheikh Mohammed bin Rashid al-Maktoum, include a $2.6 billion playpen theme-named International Chess City with some 32 towers shaped like pawns, bishops and other chess pieces. On the Sheikh’s radar screen, yet another part of his supremely ambitious entertainment network to lure travelers, is a huge Falcon City of Wonders—falconry is a major Arabian sport. Looks like the trained birds will take a back perch to the city’s other tourist attractions, what with planned replicas of the Hanging Gardens of Babylon, the Great Wall of China, and—now this is creativity, for sure—New York’s Central Park (reduced to 23 acres).        

 

All this sugar sweetens the tough business realities of Dubai. All its office towers, broad boulevards and telecom services make the emirate a user-friendly enclave for doing business globally. The Emirates, one of the world’s best-run airlines managed by the sheik, gets you there in imperial style. By now, the Port of Dubai is in the top tier of hubs for processing cargo shipments. And who is to say how many businessmen in Dubai have questionable credentials, like some of the residents of Monaco? (“A sunny place for shady people,” as writer Somerset Maughan described the Riviera principality.)

 

But nothing is stopping the sheik from relentlessly substituting business services and tourist attractions for dwindling oil income, once about 50 percent of the emirate’s revenues but now only 5 percent. Some 6 million business and leisure travelers now go in and out of Dubai annually, overnighting or transiting. The sheik’s goal: 10 million visitors by the end of 2010.      

 

Rue de What?

 

The least of the problems dining in Europe is to get the right name, address and phone number of your gastronomic destination for a business lunch or dinner. For a solution—as easy to use as a guide to Kansas City but it’s Brussels, Istanbul, London, Zurich and 23 other major European cities—turn to the new 267-page Zagat/Survey 2007: Europe’s Top Restaurants ($15.95).

 

Now this was work, what with 1,479 restaurants to identify and describe with the usual mixture of Zagatian quotes (from “bathed in truffles” to “outrageously expensive”) proffered by dining-outers who lived through these meals. The listings are so amazingly styled in Zagat-speak that even restaurants in Prague, where the Czech language labors with as many as three accent marks on a tiny five-letter word, seem as accessible as a McDonald’s. Ditto Zagat’s General Patton blitzkrieg of the Russian cyrillic alphabet in the Moscow listings, let alone the task of unscrambling phone-number variants across Europe.

 

Did we forget the thousands of restaurant candidates that ended up on the cutting-room floor, browbeaten by the best-of-breed biggies such as Ireland’s Thornton’s Restaurant (“a great way to start or finish a trip to Dublin,” London’s Gordon Ramsay at 68 Royal Hospital Rd. (“wine list that resembles a phone directory”), and Hamburg’s Haerlin (“famous guests from radio, television and politics”).

 

Vacation: Stirred, Not Forsaken

James Bond may be the ultimate spy dodging danger in a surrealistic world, but you can replay some of his moves on firmer ground by vacationing where Hollywood took some of the most eye-catching 007 shots. Author Ian Fleming found the Caribbean fascinatingly sultry and sexy. So it’s no surprise that in the new Casino Royale the One & Only Beach Club (suites from about $500, http://www.oneandonlyresorts.com/) on Paradise Island, a footbridge away from Nassau in the Bahamas, does a star turn—and you can play its scenic seaside 18-holer to vary your martini diet. Dr. No, the 1962 hit awash with Caribbean settings, features a fisherman’s haven, more recently renovated, called Morgan’s Harbour Hotel (rooms from $160, http://www.morgansharbour.com/) and located in Port Royal, Jamaica, where Sean Connery, surely the best of the six secret agents to date, bonds with his ally Quarrel.

 

In The Spy Who Loved Me, a 1977 thriller, 007 and KGB agent Major Anya Amasova parry and thrust in Hotel Cala di Volpe (rooms from about $500, http://www.starwoodhotels.com/), a dreamy and super-expensive Mediterranean retreat tucked into a charming bay on Sardinia’s rugged coast. Global traveler that he is, Bond serves up intrigue in hot curry portions in 1983’s Octopussy when he slips into India’s exotic Taj Lake Palace Hotel (suites from $450, http://www.tajhotels.com/), a former maharajah’s mansion that visually floats in a lake in Udaipur southwest of Delhi.  When the Bondmeisters conjure up a 22nd spy film in the indomitable series, I’ll bet that they’ll zero in on Dubai, the over-the-top emirate on the Persian Gulf, for some stunning backdrops with camel races and falconry spectaculars to add some spin.

 

iPods Aloft

 

Apple is working with Panasonic Avionics to hook up iPods aboard leading airlines. By mid-2007 Air France, Continental, Delta, Emirates, KLM and United will begin offering in-flight seat connections that will power and charge the popular players and show video programs on seatback screens. With some 70 million iPods sold, hotels and automakers as well as airlines are scrambling to install hookups.