Skybus Shutdown Completes This Week’s Hat Trick

Seriously, this is getting ridiculous. Monday it’s Aloha, Thursday it’s ATA, and now Saturday it’s Skybus. The airline flew its final flight last night, and now all the shiny new Airbii (um, let’s just pretend like that’s the plural of Airbus) are grounded. I think I speak for everyone who follows this industry when I say, “holy crap.”

Wheel of Fortune BankruptIt’s not the fact that these particular airlines went out of business that leaves me in shock. I mean, they were all sort of knocking on death’s door anyway. It’s the fact that ANY airline actually went out of business, let alone three of them. I mean, this is the kind of stuff that probably would have happened on a much larger scale earlier this decade had the government not stepped in, but they did. Now the industry is finally going to rationalize . . . I hope.

For travelers, this Skybus shutdown is a little better than the others. Skybus isn’t filing for bankruptcy until Monday, and if you believe USA Today, everyone who held tickets will be “eligible for a full refund.” Aloha and ATA travelers (including a few friends of mine) should only be so lucky.

This one also feels different for me personally. Though I have fond memories of ATA and Aloha from past travels, I never got the chance to fly Skybus. Heck, they didn’t even make it a full year. That being said, I’m not completely untouched by this one. Two of my friends work, er, worked at the airline. There are a lot of people out of work after these three shutdowns, and that’s a very sad thing.

So now Skybus is gone, probably doomed from trying to fly to too many secondary airports in mid-sized metro areas. I still think there’s potential for Gary (outside Chicago) to work one day, but they barely even touched that airport. Columbus just didn’t seem like the right place, let alone Greensboro. So, they’re gone. Who’s next?

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61 Comments on "Skybus Shutdown Completes This Week’s Hat Trick"

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Wonko Beeblebrox
Guest

You forgot about Champion Air going Ch7/11 as well:

http://www.championair.com/PressRoom.asp?PressReleaseID=21

That makes it four in one week.

[Who’s next? ExpressJet?]

David
Guest

The difference between Champion (and Skyway Airlines, which also flies its last flights today) and Aloha/ATA/Skybus is that both Champion and Skyway are planned/planning ahead. Champion doesn’t stop flying until May 31, and Skyway was also announced in advance (plus much of their service is simply being replaced by SkyWest).

Akit
Guest

I guess people didn’t like the skybus attitude charging you for every single little thing.

It’s unbelievable that this company went belly-up in just a year.

Court
Guest
Akit: Actually, those people who flew Skybus preferred the ancillary model. Living in Cincinnati, I routinely run into people who flew Skybus and were eager to pay the extra $10 to board first. The ancillary model isn’t broken. Ask Allegiant. What was broken was Skybus’ business plan from the get-go. I’ve spent many hours poring through their business plan, and from well over two years ago, it never made sense. It’s no surprise they shut down. I think the surprise is that they shut down so quickly. They still had money in the bank. One has to wonder what the… Read more »
Court
Guest
Also, Regarding the refunds, I don’t think anything is coming from Skybus at all. According to their website, passengers have to go through their credit card companies: “Passengers holding reservations for Skybus flights scheduled to depart on or after Saturday, April 5, 2008 should contact their credit card companies to arrange to apply for a refund.” My parents were supposed to fly GYY-GSO several weeks ago, and two canceled flights sent them back home with the promise of a refund. Of course they gave no phone number, but the email address provided always came up empty. If they aren’t doing… Read more »
Scott
Guest

I can’t say I’m surprised about Skybus. My big question though is who’s next, if anyone?

Im scheduled to fly VA in a few months but am worried at this point that may not happen. If Richard were in control of the airline I know he wouldnt let it fail, but with US investors at the helm here, could they get spooked and want to pull out given thus recent rash of closures?

Akit
Guest

VA is interesting, but I’m wondering what will happen with them too. The InsideTrip website ways that VA flights are usually half full. Is that true?

flyunited1979
Member

I think the data on VX load factors comes from T-100 data, which is publicly, and therefore true.

While normally I would never make any guesses to profitability based on load factor numbers, it’s not likely that load factors in the 50s and 60s on many routes through the end of 2007, month after month, are profit-generating.

Nick Barnard
Member

I think SkyBus only mentions the contacting their credit card company for a refund bit, because that was the only way they allowed passengers to pay.. I might be wrong.. but I think this is it.

Wonko Beeblebrox
Guest

What about Frontier? I’ve got a free ticket on them thanks to some of my business travel.

It seems like almost every time they’ve tried to expand out of Denver they have been denied (and then retreated)…

flyunited1979
Member

I agree with Cranky’s comment about Frontier.

By some analyst’s estimates, Frontier will run out of cash by end of 2008 given current fuel costs and assuming inability to significantly boost revenues.

Courtney
Guest
I’m a big fan of Frontier, but their situation certainly seems dire. Countless attempts to break their land-locked position in Denver have failed, and now they’re staring directly down the barrels of both UA AND WN. I wonder if they’ll make a move for CMH now that Skybus has left a hungry low-fare passenger base. Unfortunately, I just can’t see that working, either. I hate to even ask the question, but is their best chance a union with jetBlue? Very similar product, and a fantastic gateway to the West for jetBlue. Maybe jetBlue would start putting animals on their tails… Read more »
Wonko Beeblebrox
Guest

The problem with that is that Frontier and jetBlue have different engined Airbuses. So yes, Frontier has the A319 (which is much better than jetBlue’s A320s for the transcon routes when the wind kicks up)… but still…

AA discovered that a differently-engined subfleet was a bad idea with the TWA 757s they got thru the TWA buyout (hint: they’re now Delta 757s).

Now granted, Usair/America West doesn’t seem to have any concerns with differently engined airbus fleets…

Dan Webb
Guest
I can’t say I’m too surprised about Skybus. While ULCC have been successful in Europe, I think Skybus may have taken it too far. I mean, hell, Ryanair even has phone numbers, wheras Skybus didn’t. The schedule with limited frequencies was also an issue for sure. As for Frontier, yes they are in trouble, and I’ve also heard the JetBlue-Frontier rumor. How have the loads been on the Q400 and E70 flights? But I agree Frontier needs a new hub, it’s just a question of where. Perhaps an airport that has been abandoned by other airlines? STL? PIT? Or maybe… Read more »
Wonko Beeblebrox
Guest

Frontier’s “new hub” could be in Phoenix-Mesa. I’m surprised other carriers (eg: ExpressJet) have not started flights there yet. Phoenix is the nation’s 5th largest city– served by mainly one pax airport right now… lots of people live closer to IWA than they do to PHX.

Allegiant is already doing it, but mostly to cities that aren’t very big.

I still think someone could make money starting service from IWA to well-known business centers, going head-to-head against usairways….

flyunited1979
Member

The difference between Ryanair and Skybus is that Ryanair flies between cities that has significant travel demand, and in some cases, were previously poorly-served with low fare airlines.

Someone
Guest
With regard to the refunds, the proper way to apply is through the bank issuing the credit card used to pay for the ticket (Skybus only accepted credit card payments for tickets). When an airline accepts credit cards for payment, they are required to keep a sizable reserve on deposit with their processing bank. Chargebacks are very common in the travel industry, so the banks make the airline keep a good amount in this account. That reserve is also there for this very reason…if the travel provider ceases operations, the reserve is not subject to BK court oversight, so passengers… Read more »
Zack Rules
Guest

I think Virgin America will go next. Competition has really not let their load factors go up significantly. Hopefully, jetBlue will buy them if they do bite the dust.
Midwest is pretty weak at the moment also. They’re facing a lot of competition from Airtran. They operate 13 MD80’s which are real gas guzzlers. Plus, their only expansion has been through CRJ-200’s which everyone else has been dropping because they’re not efficient at current fuel prices. They’ve got Southwest at Kansas City [and possibly a stronger Airtran presence] and Airtran’s new Milwaukee flights.

flyunited1979
Member

VX and B6 also have incompatible engines and I’d be surprised if B6 were pouring money into expanding their fleet given high fuel prices.

Dan Webb
Guest

“My understanding about engine commonality is that at a certain point, you have a large enough fleet of each where you don’t really get huge benefits of going with a single fleet.”

Well I think the issue for US about engines is how the maintenance systems of HP/US have been coming together. For example, is US stocking IAE parts and training mechanics back East so HP planes can be worked on over on this half of the country? So however that situation is being handle can affect cost (at least I think so).

Nick Barnard
Member

Ohh, US Airways decided to go after SkyBus’s passengers: http://phx.corporate-ir.net/phoenix.zhtml?c=196799&p=irol-newsArticle&ID=1126135&highlight=

I had read (maybe here?) that most airlines would probably snub SkyBus’s passengers…

Court
Guest

Wow. Standby travel at $50 per leg plus taxes. I don’t think Airways has any CMH to… well… anywhere flights, so that’s at least a two leg $100 per one-way standby ticket. That’s more than the vast majority of Skybus tickets to begin with.

Good move by Airways. They look like the good guy, and get a nice chunk of change for true space available passengers. I still call it a snubbing, though.

flyunited1979
Member

B6 also is assisting SkyBus customers.

http://biz.yahoo.com/pz/080405/139608.html

As is AirTran.

http://biz.yahoo.com/prnews/080405/nysa004.html?.v=101

Dawn
Guest

Have you heard anything about Skybus’s founder trying to save the airline? I heard a blurb about them still having $10 million and trying to get more investors to get the airline going again.

Flysoften
Guest
Yes, it is apparently true. The founder of Skybus wants to fix the airline he founded and left after he and the new CEO had major disagreements on the direction the new CEO wanted to take the airline. The founder’s plan was based on Ryanair and its original route selections were based on computer modeling by the Back Aviation Group. The routes selected by the Back Group were even better than projected. Then ego overrode common sense and the new CEO who had no operational experience started expanding at a pace not envisioned by the Founders plan to cities that… Read more »
Flysoften
Guest

Wrong! Columbus was cutting it very well (80% load factors)before Diffenderfer let his ego go to excess with rapid unresearched expansion routes without research and much faster than originally planned by the founder. The model is viable and Columbus is a great place.

Flysoften
Guest
You are right, high load factors does not always means success. It takes good management too. Skybus started out with the former, but the latter left. John Weikle, Mark Sparling and Jason Hazen all left after realizing Diffenderfer wanted to take Skybus away from the model that it sold to investors. CMH is an excellent market for a low cost carrier. And, if you look at Charlotte, Dallas and Houston they all grew at an amazing pace when they became hub cities for USAir, Southwest, American and Continental. Having an airline is a powerful economic development tool. CMH is in… Read more »
Sam
Guest
Here is my letter to the editor of the Dispatch in CMH: Dear Editor, As a former pilot with Skybus I can tell you that I am certain that the failure of the company is 90% poor management (especially by Bill Diffenderfer) and 10% economic conditions. A company called Allegiant, fling far less efficient airplanes is making money in this market segment, but they’re smarter in how they run the company. On top of this, they paid their employees better wages to add to their disadvantage. Skybus managers had by a long shot the lowest wages and benefits in the… Read more »
Dave E of Punta Gorda
Guest
Dave E of Punta Gorda
I flew Skybus twelve times betwen Portsmouth and Punta Gorda and was delighted with the service and the Arbus A319 airplanes. Much better than AA’s aging fleet or US Airways’ aging 737’s. Three things killed this airline IMHO. First, too rapid expansion which led the the airline competing with itself (I could fly Porstmouth to Punta Gorda direct in February for $210 one way, or fl the same route with a stopover in Greensboro for $40 r/t (not convenient, you say, but this was a discount airline with discount-minded cusomers). Second, it lacked scheduling flexibility. Load factors into and out… Read more »
flayslot
Guest
Thank you Mr. Samaha for your insiders look at Skybus. It was not the model but Diffenderfer and investor greed that brought SKybus down. The investors wanted to make a killing with an IPO and Diffenderfer did every stupid thing imagineable to bring them to IPO before the airline had a snowball’s chance to make Skybus work. In addition, we must add to the mix of insanity COO Gile who followed Diffenderfer so close his nose was brown from the Diffenderfer excrement. Poor operations, poor management. I have even heard about one of the Captains on Skybus as being quoted… Read more »
Sam
Guest
Amen Flyslot.. Amen. Dave E… we continuously gave them feedback (directly as a result of seeing 40-50 people on a flight) about what was working and what was not. I would constantly send emails to top managers (marketing, COO, DO, etc..) with observations from the front line, and others I knew sent even more.. and rarely did one get a response, much less see any action. To his credit, Bud Sittig, the DO was the only one that I felt poured his heart into it.. He would response to my suggestions with lengthy and well thought out answers as to… Read more »
flayslot
Guest
Lets hope they start a public “Save the Bus” campaign in Columbus. The model works! Ryanair continues to be wildly successful even with high fuel prices which are affecting all the airlines pretty much equally. If a campaign to “Save the Bus” is started by anyone, I hope you will join them in this effort. I will too! Not only for the 450 Skybus employees, also the employees who serviced Skybus, the airport personnel hired in each city to handle the passenger loads, the restaurants, the service companies, limo and bus drivers and so on. I hope you will too!
Sam
Guest

I and many of my peers would.

I don’t live in CMH, but someone who does might.

flayslot
Guest

Hi Sam,

I don’t live in CMH either. I have a plane and a couple of tickets on Frequent Flyer Miles to get you to CMH or close enough I can fly you to CMH (actually, I would let you fly since you have the big ticket). At any rate, I want to work with the SX founder and its employess to make Skybus happen as it was intended by the founder. If you want to work with me, I can find your phone number on the web.

Flysalot

Sam
Guest

I am in touch with the founder if you want to help. I can contact him on your behalf.. if you give me a good email or contact info for you. I can only devote so much time to anything as my primary job is finding a job now.. Again, I can put you in touch with John Weikle if you need.

Sam

flayslot
Guest

Please tell John Weikle that he has my permission to give me your contact information. I understand about the job search and the limitations that puts on your time.

Sam
Guest

flayslot, just to be clear, are you talking to John too? I’m not sure if you want me to tell John to release my contact info to you or the other way around? I just hate to post a phone or email on here as it’s always a bad idea to post such things on a public forum.

Sam
Guest

Maybe MR. CF can put us each in touch with on another without posting our info in public.. I’ll email him, and you do the same.

Virginia
Guest

John Weikle…please start Skybus up again!!

SkybusFlyGirl
Guest
I to can attest to Skybus managements total lack of competency, if you thought it was bad at the top, middle management was even worse. Drawing in bloated salaries, and afraid to make a mistake, so better to not make any decisions at all. The entire enterprise was crippled from the beginning,without someone to put their heart and soul into it, like I believe John Weikle intended to do. The Flight Attendants and Pilots worked tirelessly to make Skybus a wonderful experience for our customers. As far as I know, we the crew,were constantly praised for making an enjoyable experience… Read more »
flysoften
Guest
I heard the employees are suing Skybus for 60 days wages. Anyone know who is representing the employees? I have talked to John Weikle and he is still stunned at how quickly Diffenderfer and the COO ran Skybus into the ground. He believes he can fix it! He has asked the Directors to work with him. While they have not accepted his offer to work with them, at least one of the directors, Bob Milbourne, has made the statement that if it could have been turned around, the directors would have done it. This guy just does not get it.… Read more »
Virginia
Guest

SAVE SKYBUS and let John Weikle run it!!

flysoften
Guest
Skybus should be saved to keep the large airlines from gouging the public. Northwest and Delta will shortly merge and that will be a huge loss to Cincinnati because the new Delta will shut down its hub there in favor of Detroit. The next merger is going to be United and Continental. My friend, a United pilot, says the deal is done and will be announced in the next couple of days. I have also heard rumors that Southwest is open to a merger. This makes the Skybus franchise even more necessary to stem price gouging by the majors than… Read more »
Jason
Guest
While I wish that SX would return, I doubt it will, at least not in Columbus. The public would be too “afraid” to fly them again for fear of being stranded. It sucks that the vision of the founder was twisted around and changed by someone who simply enjoyed the sound of his own voice. There was an article in The Dispatch saturday i think that said someone could take over SX’s operating certificate, but the name would probably have to be changed. I would be very interested in knowing what cities were chosen as a result of the computer… Read more »
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