The year is almost done, and you know what that means. It’s time to review the airlines we’ve lost in 2010. The good news? We had fewer airlines disappear this year than last and many of them were piddly little guys that I won’t even bother discussing here. (Strategic France, anyone?) But we did have some big names disappear as well as some quirky little guys. Let’s get going.

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Blue Wings (again) – January 13, 2010
Wait, didn’t Blue Wings already shut down last year? Yep. It sure did, but it was able to rise from the grave only to be pushed right back in again soon after its resurrection. The airline had plenty of money woes throughout its short life in Germany and now it appears to be gone for good. (Then again I thought that was the case last year as well.) Now we can finally avoid all those problems of passengers mistaking Blue Wings for Blue Wing Airlines in Suriname. Man, that was always such a tough one to deal with.

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Taban Air – January 24, 2010
Anyone heard of Taban Air? Probably not since it was in Iran and that’s literally an aviation graveyard since the airlines can’t get new airplanes from the west (or parts for that matter). Taban got off the ground in 2006 and had a motley fleet of 1 Russian-built Tupolev along with a couple of leased birds of other types. Things were going swimmingly until flight 6437 had a problem. The plane was holding over Mashhad, waiting for the weather to clear up, when a passenger got sick. Instead of waiting for the weather to clear or diverting, the crew decided to just land the thing anyway. Not smart. The plane cracked up but everyone lived. Good for the people, bad for the airline. It’s certificate was revoked.

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Northwest – January 31, 2010
Some argued that Northwest truly went away last year, but I didn’t see the real end until this January when the website was shut down and the NW code disappeared. While there is still work to do and I’m sure there are some little props flying around with the old Northwest colors, that truly was the end of an airline with a long and storied history. Now it exists in a little corner of the Delta Heritage Museum and that’s about it. I never had much love for Northwest myself but any airline that survived that long certainly deserves some recognition.

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Tafa Air – February 2010
Raise your hand if you have the worst idea for a low cost carrier. Now put it down, because Tafa Air has to take the cake. The idea was to bring Albanians living outside of the country back and forth. Germany was the primary market, but let’s be honest, there just aren’t that many Albanians in the world. The airline started just before Christmas 2009 so it probably had a couple of good weeks. But then it realized that Christmas travel can’t sustain you all year. The airline lost its aircraft lease in February and tried to come back, but it never did. Tafa was doomed from the start.

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Viva Macau – March 26, 2010
You have to love an airline that shuts down in March but still has a live website by the end of the year. Viva Macau was an, um, interesting airline. Macau was the Portuguese equivalent of Hong Kong that really has been best known for its gambling. Air Macau has a stranglehold on the city but Viva Macau fought hard to start up and bring low cost flights throughout Asia and Australia. That was its first mistake. There was an agreement that allowed Air Macau to veto any routes that Viva Macau wanted to fly, so the airline never could do what it wanted entirely. In the end, the government got involved, canceled the agreement between Air Macau and Viva Macau, and then said Viva Macau was unfit to fly so it revoked its certificate. Great place to operate an airline, it would seem.

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Skyservice – March 31, 2010
Apparently if you aren’t Air Canada or WestJet, you’re doomed to failure. (And don’t start on Porter – have you seen their numbers?) Skyservice was a charter operator in Canada, as so many others have done, and it failed, like so many others. In that truly kind Canadian fashion, it didn’t shut down until after the busy Spring Break season and it was a relatively orderly demise. Gotta love those Canucks. The death of Skyservice has opened the door for primarily regional operator Jazz to step in. It is now flying big jets on behalf of Thomas Cook. Canadians need to get to the sun somehow.

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Sama Airlines – August 24, 2010
Sama was an airline with a plan . . . a plan that changed weekly, it seemed. The airline was one of the first of two low cost carriers to start up in Saudi Arabia. It initially focused on domestic flying, but then it shifted to an international focus. I use the word “focus” loosely because it went in and out of markets on a fairly regular basis. In the end, it couldn’t find any strategy that actually resulted in a profit, so it shut down. Not exactly the easiest place to run a low cost carrier, to be fair, but now there’s only one. Nasair will have to carry the torch for now.

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Mexicana – August 28, 2010
Ah, Mexicana. This is another airline that we might see on the list again next year if it gets re-started as supposedly planned. Mexicana is probably the highest profile failure this year and it couldn’t have happened to a nicer airline. Briefly known as the Worst Airline Ever, Mexicana had so many problems that it was better off just going away. There have been attempts to resurrect the airline from the dead, but so far they’ve failed. Meanwhile, airlines like Aeromexico and Volaris have filled in the gaps along with US carriers. Pretty soon, nobody will miss this airline at all.

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Midwest Airlines – October 1, 2010
As with Northwest, there are a lot of dates you could use to show the death of Midwest. Sure, it could have been the day former CEO Tim Hoeksema put the airline on a path to the end several years ago. Or it could have been when Midwest stopped flying its own airplanes and instead outsourced it all. But on October 1, the YX code went away as did the Midwest website. Despite the stray airplane painted in Midwest colors, it’s hard to argue that Midwest still exists in any form other than the cookie that Frontier hands out. After a long illness, Midwest is dead.

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Fred Kahn – December 27, 2010
I’m throwing you a curveball with this. No, Fred Kahn wasn’t an airline, but he was the father of deregulation in this industry. And when he died on Monday, I thought it was only appropriate to include him in this list. After all, the deregulation of the airline industry, while unequivocally the right thing to do, did result in several storied airlines joining the graveyard over the years. Many in the industry say deregulation was a bad thing, and that’s because it probably was for them. But deregulation lowered fares and enabled millions of people to fly and that’s why it was such a good thing. It may not have happened without Fred, so he definitely deserves a salute.

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That’s it for this year. I left off some smaller guys including charter and cargo airlines, as usual. Feel free to chime in with the ones you miss most in the comments section.

Today is an historic day. For the first time in years, Alitalia is no longer the worst airline ever. Mexicana’s slow and painful demise has caused so many problems for so many people that the airline has won its place as the new worst airline ever. I know, you’ll need a moment to take it all in.

If you haven’t been following the south-of-the-border saga, you can start with my earlier post from a couple weeks ago. In short, Mexicana is trying to play a shell game. There are three airlines under the Mexicana name. Mexicana Click is the low cost carrier that flies domestically. Mexicana Link buzzes around with 50 seat regional jets. And then there’s Compañía Mexicana de Aviación.

Compañía Mexicana de Aviación is the original Mexicana and because of that, it has a lot of baggage. The labor costs are very high and the debt is stifling, so the airline filed for bankruptcy. What’s the solution? It appears to be that the goal is to crush labor and wipe the debt from the existing company and transfer everything to the lower cost Mexicana Click. That airline will then come out of the ashes as the new Mexicana. At least, that’s how it looks to me.

That’s all fairly shady in its own right, but it’s what’s happened since the bankruptcy filing that has rocketed the airline into the stratosphere of suck. Mexicana has been trying to set up Click from an IT perspective so that it can handle many of the same functions that Mexicana handles today. It’s taking a long time. In the meantime, the airline has actually stopped taking bookings but continues to fly. Yep, that’s right. Airplanes are flying but no new bookings are coming in.

That is insane in its own right, but it causes additional problems as well. Mexicana has already had some aircraft repossessed, expects to return 40% of its fleet to lessors, and hasn’t been running a full schedule. Originally, the affected flights were canceled through August, but now they are canceled “until new notice.” What the heck? This includes flights to London, Madrid, São Paulo, Buenos Aires, San José (Costa Rica), Caracas, Bogotá, Montreal, Vancouver, San Antonio, Chicago and Fresno. This is where it gets absolutely insane. Though flights are canceled until new notice, they aren’t actually canceled yet. They’re sitting in limbo and that means passengers are in a terrible place.

I’ll give you the example of a Cranky Concierge client whose parents are taking their lifelong dream trip to Spain in September. They are booked on Mexicana and would like to change, but Mexicana hasn’t officially canceled the flights yet.

What’s the upshot here? Mexicana says that it will not issue a refund because the flights haven’t really been canceled, and they won’t put passengers on another airline for the same reason. They say that they will only put passengers on another airline within 7 days of travel. Could that be any more maddening?

If the airline would just admit that it doesn’t have the planes to fly this route and canceled further in the advance, then it would give the passengers time to find alternates. But saying that passengers will only be reaccommodated within a week means there will be very few if any options available.

If you’re booked on Mexicana, this is like watching a train come at you in slow motion and you can’t move out of the way. You know your flight will be canceled, but there’s absolutely nothing you can do about it because the airline is holding your money hostage.

Sure, you can buy a new ticket, but there’s no guarantee you’ll get your money back for the old one. If Mexicana does miraculously fly those flights, you’ll be out of luck. And you can’t dispute it with your credit card until the flight has canceled. It’s a no-win situation for passengers.

This kind of behavior from an airline is just like nothing I’ve ever seen before. Forget about being held hostage on the airplane. We need regulation preventing an airline from keeping your money and your travel plans hostage. I don’t think I’ve ever seen such blatant disregard for customers on a broad scale like this before. And unlike Alitalia, I’ve actually flown this airline and had an absolutely horrendous experience that simply adds to the case.

That is why Mexicana is the worst airline in the world. Even if the announced sale of the airline is actually true, there’s a lot of work to be done to get the airline out of this pit. I know Italians are cheering everywhere that their airline has climbed out of the cellar. But just remember, if Mexicana goes under, the title reverts back to you. So don’t get too cocky, Alitalia.

[Original photo via Flickr user lightmatter]

Mexicana appears to be on life support this week and it’s quickly moved to blaming the unions for its predicament. We’ve seen airlines blame labor time after time here in the US, but I don’t believe I’ve ever seen an airline say that the unions are the only problem it has. I can tell you from first-hand experience that the airline has a lot more problems than that, but why confront those if you can just blame labor? It’s so much easier, right? Yeah, right.

The airline, now owned by conglomerate Grupo Posadas, has come out firing. Mexicana filed for bankruptcy in the US and Mexico after having given the unions an ultimatum and failing. The pilots and flight attendants had two bad choices. If you are booked on Mexicana, good luck. Your flight is likely still going for now, but their customer service is non-existent. And the chance of the airline shutting down goes up each day. If you’re booked on Mexicana, make sure your flight is still there. A good chunk have been permanently canceled going forward, though the airline does continue to operate what’s left.

As I said, Mexicana is putting the blame squarely on labor at this point:

Although the airline’s operating costs excluding crew labor costs are 30% lower than the average of legacy airlines in the United States, these non competitive labor costs are the main reason why the company has continued to suffer losses, to the extent that it is now financially non-viable.

There’s no question that the pilots and flight attendants make a pretty penny at the airline. One local report says the average pilot salary is $228,000 (that’s US Dollars), and that seems crazy. But I also hate the “average salary” measure because it doesn’t give you a true representation of the contract. Still, it seems quite obvious that concessions are going to be necessary. The flight attendants make an average of $53,000. Mexicana is looking to slash everyone’s salary dramatically while also laying off a bunch of people. But we’ll come back to that in a second. First, let’s talk about Mexicana’s structure to get a better understanding of where this is going.

Mexicana is really three airlines these days. The main airline is the one in trouble here, and the owners are trying to play a shell game. Mexicana itself is the international airline that has around 60 airplanes. Mexicana Click is the low cost/domestic carrier that took the old Midwest 717s to fly mostly within Mexico. It has about half the number of planes that the main airline has. Then there’s Mexicana Link which flies 15 regional jets as well. Those two airlines have much lower crew costs, and it’s clear that Mexicana is now trying to use them to replace Mexicana flying.

The company had given the pilots and flight attendants two options. Neither option was good, and the spin in the press release would impress even a Fox News analyst. I’ve received further background on these offers, and I see it as a no-win situation.

The first offer was to slash wages by 39 to 41 percent and lay off 40 percent of the crews. In exchange, Mexicana would offer profit sharing (no percentage is given) when the airline makes at least a 5 percent margin. Those are pretty drastic cuts and were highly unlikely to gain acceptance. Even if some of the crew members agreed to take such drastic cuts, why would 40 percent of them vote to lose their jobs?

The second offer was just shady. Mexicana wants to sell the airline to the flight attendants and pilots for 1 peso. Sounds great, right? Um, no. This sale includes, of course, mountains of debt that Mexicana has added over the years. In general, I like this idea. I say that, because I don’t like Mexicana and the airline will be bankrupt within a year. When labor runs an airline, things don’t work out well. But the plan is so much more diabolical than that.

The press release does note that the union would only be able to use the Mexicana name for six months, at which time it would have to become something else. What the release fails to note is that Mexicana would also require that the pilots union resign from representing pilots at Mexicana Click because of the conflict of interest. Ah, now it becomes clear.

Mexicana spins off the garbage – the old airline and its debt – to labor. Meanwhile, Click goes union-less. In six months, the old Mexicana becomes some other airline until it limps right into the grave. Then Click becomes Mexicana, without unions and with much lower costs.

If you’re a union, what do you do? Turn it down, and that’s what they did. If you lose more than a third of your pay and nearly half your colleagues, would you vote for option #1? Would anyone in their right mind vote for option #2? Maybe this is Mexicana’s way of bargaining, but it seems to be an ultimatum more than anything else. If Mexicana is willing to negotiate, then maybe something can be salvaged. If not, I fully expect to see the airline go under, with Click eventually rising from the ashes to take over the Mexicana name.

Bottom line: If you’re a passenger, I would not book on Mexicana right now because of the volatility. If you work for Mexicana, I’d start sending my resume out right now. Those stellar customer service skills can be put to good use at, oh, say a cell phone company. Or maybe the cable guys need more help angering their customers.

[Original Photo via Flickr user vaticanus]