It’s time once again for the third annual edition of “Airlines We Lost.” This was a pretty active year, as you can probably imagine. Sadly, my wish last year for Alitalia to be on this year’s list has not come true. That airline soliders on while others have not been so lucky to have a government behind them to prop them up. As I said, last year, let us hope that all the former employees of these airlines find new jobs with ease. I’m probably taking Friday off, so I’ll be back again Monday. Happy New Year!


AlpiEagles – January 3, 2008


We were barely into 2008 when AlpiEagles became the first airline of the year to shut down. To be honest, I don’t know much about these guys, but if I couldn’t include Alitalia, I had to at least find one Italian airline. A Google search found some references that make me think it wasn’t much of a surprise that these guys went under. In fact, I’m somewhat amazed they lasted as long as they did.



Boston-Maine (Pan Am) – February 29, 2008

It’s not often that I’m happy to see an airline go out of business, but this is most certainly one of them. When the Pan Am name and colors were slapped on this two-bit outfit flying old 727s into backwater airports, it was an embarrassment. To make things even worse, this airline was effectively a union-buster that was given the Pan Am name and routes when the previous version of Pan Am was shut down by the parent company. Earlier this year, the DOT put out a scathing report that the airline was financially unfit, lacked proper management oversight, and didn’t follow rules.


Big Sky – March 8, 2008

Big Sky was a sad loss, at least for those who relied on the airline to get around the upper Midwest for years. Big Sky was acquired by Mesaba’s parent, but when Mesaba was sold to Northwest, the parent company wanted out of the airline business. The 19-seaters weren’t making much money, so it was time to call it quits. I remember when I was at America West and we signed a codeshare with Big Sky. There were very few airports they served that I’d even heard of before, but they were the lifeline for the people who lived in those places.



Adam Air – March 18, 2008

If anyone is actually surprised by this one, you must not pay much attention to aviation accidents. Adam Air came out of Indonesia and did a good job of convincing people not to fly it. There were a number of accidents and incidents over its relatively short life span, and ultimately the Indonesian government mercifully shut them down. We should all be able to sleep easier at night knowing that this airline is gone from the scene.



Aloha Airlines – March 31, 2008

For me, this is the saddest failure of the year. If this were the Academy Awards when they show the people who died in the last year, Aloha would undoubtedly get the loudest applause. The oldest airline to fail last year, Aloha succumbed to a brutal competitive environment thanks to the entry of go! into the Interisland Hawaiian market. Lawsuits have dragged on, but it appears they have recently been settled with the understanding that go!, the very airline that killed Aloha, will rebrand as Aloha. This was so unpalatable that even the judge put a temporary stop to it.



ATA – April 3, 2008

Though ATA was an airline that many people hated, I actually never had a bad experience flying them. In fact, I always had good experiences. They reached their zenith in the early 2000s as they grew their Chicago and Indianapolis hubs under now-United drone John Tague but collapsed mightily soon after. Southwest picked up the remains, and the airline limped along for awhile, but ultimately, the owners bought a couple other airlines and shut down the original. A sad end for an airline with a long history.



Skybus – April 4, 2008

Ah yes, remember Skybus? It seems like it was only around for a few minutes, so you may have forgotten them by now. The idea was to offer ultra low fare flights originally only from its Columbus hub. Columbus? Yeah. That might go a long way to explain why it didn’t work. But this airline called it quits before it actually had to. In fact, there was money left in the bank, but the management decided it just wasn’t going to work in the end. By this time next year, we’ll probably have forgotten completely that they ever existed.



Skyway – April 5, 2008

Poor little Skyway, better known as Midwest Connect, died because of Midwest’s insistence on not actually flying any airplanes itself. Skyway was Midwest’s wholly-owned regional subsidiary, but Midwest decided it would rather have SkyWest operate the routes instead. So while Skyway lives on as a ground operations company, it no longer has any planes. Then again, Midwest doesn’t have many of its own planes left either.



Oasis HongKong – April 9, 2008

Like Skybus, Oasis HongKong had a meteoric rise only to come crashing down hard. The airline was running long haul, low fare flights between Hong Kong and both London and Vancouver. Apparently, it’s fares were too low, because one day it just disappeared. Many have argued that the long haul, low fare model doesn’t work, though Air Asia X is currently going to do its best to prove that hypothesis wrong. (Nonexistent labor costs help, by the way.)



Eos Airlines – April 26, 2008

There’s a special place for Eos in my eyes, because I interned with the airline during business school, long before it got started. In fact, it was just me and David Spurlock in a Palo Alto office working on getting funding for the airline back in 2003. The experience was great, but high fuel prices, a very small niche market, and, according to others, weak management, did the airline in. With fuel at today’s prices, it undoubtedly could have held on longer, but it’s not clear that it would have survived.



Nationwide Airlines – April 29, 2008

I’m sure there were a few thousand airlines in Africa that failed this year, but none had a higher profile than Nationwide. This airline, based in South Africa, grew to have a fairly sizable operation that even served London. In 2007, Nationwide was shut down for regulatory non-compliance, but it briefly came back. Of course, a temporary shut down like that is just as bad as being shut down for good, so it did just that and decided to call it quits.



Far Eastern Air Transport – May 12, 2008

I don’t know really know a ton about Far Eastern Air Transport except that their tails had FAT spelled out in big block letters. That’s good comedy. I was surprised to find that this airline was actually around for fifty years, primarily as a very strong domestic carrier in Taiwan. Increased competition (in the air and on the rails) put this airline into financial trouble, and it finally called it quits after struggling to the right the ship for awhile.



Silverjet – May 30, 2008

Like Eos, Silverjet tried to do the all-premium airline model and failed miserably. I’m told Silverjet had a very nice facility at London’s Luton airport, but that wasn’t enough to make it successful. Locating the airline at Luton probably didn’t help much either. Toward the end, there was all kinds of drama. It was said that a Middle Eastern firm would pump money into the airline and refocus it, but that never came through and the airline ran out of luck . . . and money.



Champion – May 31, 2008

Though Champion flew charters with its 727 fleet toward the end, its 2 letter code “MG” alludes to its roots as MGM Grand Air. MGM was a luxurious airline flying between LA and New York, but Champion did a lot of sports charters and some leisure work as well. In the end, the aging fleet wasn’t competitive in the charter market and the airline simply opted to shut down and go quietly into the night. Fortunately, it didn’t go away until after delaying the Spurs to a playoff game against the Lakers. Thanks, guys.



Air Midwest – June 30, 2008

Little Air Midwest was another casualty in the 19 seat aircraft market that really took a hit this year. This airline had been owned by Mesa for several years, and ultimately Mesa opted to completely shut down its 19 seat operation. I had the chance to fly Air Midwest on one of its little Beech 1900s from Yuma to Phoenix, and I certainly had no complaints. Then again, the weather was good that day. Were it not, I might have had a different opinion of the little airline.



ExpressJet (branded service) – September 1, 2008

Let’s get one thing clear. ExpressJet still exists and is still flying around as Continental Express and as a charter airline. The piece that died was the “branded” ExpressJet operation that was set up to fly point-to-point between smaller cities; sort of a Southwest Express in my mind. If Aloha’s failure tugged at the heartstrings, this one bothers the brain. This model still looks interesting to me, especially with lower fuel prices and a different aircraft type. I just think ExpressJet was ahead of its time on this one.



Zoom – August 28, 2008

This quirky airline had a very strange setup. The original airline was Canadian and began flying Transatlantic from Canada. Then they wanted to fly back across the Atlantic to the US from the UK so they set up a UK subsidiary to do the work. Flights went from London to places like San Diego, where no other nonstop service existed. The idea may have made sense in someone’s head, but it didn’t work at all. They collapsed under their own weight.



XL – September 12, 2008

You knew XL was set on being a low cost carrier when it decided that letters were too expensive and shortened its name from Excel. The British low cost charter operation focused on shuttling pasty white Brits to sunspots, but apparently it wasn’t concerned about getting them back when it stranded fifty thousand travelers after its shutdown. Another 200,000 had future bookings so this was likely a more expensive winter than many had planned.


AeroCalifornia – October 4, 2008

Wait, didn’t these guys already shut down? You know it, but somehow the Mexican airline didn’t make my 2006 list. AeroCalifornia operated aircraft so old they were actually flight tested by Charles Lindbergh (um, maybe not), but they were considered airworthy enough to fly to the US until 2006 when it first shut down. The airline made a brief comeback with only domestic Mexican operations, but that again ended abruptly when they ran out of money.



Sterling – October 29, 2008

Sterling quickly rose to be a massive low fare airline in Scandinavia and Europe in general, especially after acquiring Maersk. I flew Maersk once and loved the product, but Sterling had plenty of ownership shifts and never fully found its groove. It didn’t help that its most recent owners were Icelandic, not exactly a good place to be from a financial perspective these days. Cimber Air says it’s going to resurrect the airline, but, well, we’ll see about that.



European – November 30, 2008

Oh man, am I finally done? European wouldn’t get a mention here except for two things. First, it was one of the last operators (if not the last) of the 737-200 in Europe. And second, it operated for Palmair, an airline I really enjoyed learning about this year. Palmair was surprised by the failure of European, but it has found an aircraft from Jet2 to pick up the slack for now. Meanwhile, European will probably disappear quietly without any fanfare at all.

[Airlines We Lost in 2007]
[Airlines We Lost in 2006]

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.”

It’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?

(Original image)

It’s earning season, and most airlines are doing their best to mask their weak fourth quarters. It’s hilarious to see the headlines talking about what a great year it was. Then they bury their fourth quarter loss down below.

Just today, we saw US Airways and Alaska talking about how fuel prices are choking them. US Airways said, “Our fourth quarter results were materially impacted by increases in fuel prices. Had our fuel price per gallon simply remained at last year’s fourth quarter levels, our 2007 fourth quarter fuel expense would have been approximately $230 million lower.” And Alaska? “The loss was driven primarily by skyrocketing fuel costs combined with fares that have not kept pace.”

Just in case you’re a visual person, let’s take a look at some graphs showing what’s happened to fuel. Once again, I turn to government data for the answers. This time, it’s Schedule P-12A. Oh man, just the name makes me think it’s going to be interesting . . . riiiiiight.

Anyway, I isolated 16 of the airlines and graphed them below. Unfortunately, government data only goes up through September 2007 so far, but you get the point.

As you can see, they all follow the same trend . . . up, up, up. I know some of the colors are light, but with the exception of some early spikes by Hawaiian and a couple other airlines I’ll talk about in a second, they all moved together. Prices hovered below $1 a gallon until early 2004 at which point they took off like an empty 757 in a headwind. (Maybe I should stay away from the analogies.) Prices passed $2 toward the end of 2005 and except for a couple of dips back, they’ve stayed there. Ouch.

Let’s focus in on some of the exceptions. I’ve taken the 16 lines and put them into an average. Then I’ve highlighted Southwest, Allegiant, and Skybus.

As you can see, we’re looking at these airline for different reasons. Starting in 2004 when fuel prices took off, Southwest kept them low. How? They bought a bunch of fuel hedges keeping their future cost of fuel less than they’d have paid normally. Though the prices have continued to climb, they have continued to keep their prices lower than average, and that is pretty much why they’ve continued to be profitable. With average fuel costs, I believe Southwest would have been break-even at best last quarter.

In case you’re wondering, they’ve continued to hedge fuel. It looks brilliant when prices keep rising, but when (if) they fall, Southwest will be stuck paying more than others. Personally, I think that’s fine. It’s worth having some certainty in your fuel costs even if you end up paying a little more.

The other two airlines, on the other hand, are highlighted for paying way above the average. Allegiant seems to be paying through the nose for fuel. Considering that they operate fuel thirsty MD80s, this is really costing them dearly. The fact that they remain profitable is even more impressive with that knowledge.

Then we have Skybus. They seem to be paying the most of all. They like to call themselves an ultra-low cost carrier, but, um, this clearly shows otherwise. I’m not sure why they’re paying so much. It can’t be because they’re new – Virgin America is new and they fall into the pack. Maybe it’s all these small airports they fly where nobody else goes. Come to think of it, they share that characteristic with Allegiant. Hmmm.

Well at least the trends look good, right? Of course not. You see the average fuel cost in that graph was maybe around $2.10 or so. Well just to give you some numbers . . . Alaska paid $2.48 in the fourth quarter. US Airways paid $2.56. And it doesn’t look better elsewhere.

So just remember, if you’re complaining about your ticket price being too expensive . . . pipe down. It should probably cost you even more than that.

It’s been awhile since I’ve checked in on Skybus, but I figured their announcement that they’re finally opening a new base (in Greensboro) meant it was time to check-in.

There’s actually been a lot going on with the airline’s route network recently. First, on September 20, they announced they’d start flying to Chattanooga, Milwaukee, Gulfport/Biloxi, and Punta Gorda. Since most people probably don’t know where most of those cities are, this definitely keeps with their plan of serving places others don’t go very often. (Ok, Milwaukee is an exception.)

In fact, Skybus will have the only commercial service at Punta Gorda, which is outside Ft Myers in Florida. I mean, since when does Ft Myers need a reliever airport!?! Surely it’s because Punta Gorda is cheaper. (Of course it is, and don’t call me Shirley.)

The announcement on Sept 25 was more interesting to me. That’s when they said they’d fly their first non-Columbus routes – Portsmouth (New Hampshire) to both St Augustine and Punta Gorda (Florida). Looks like they’re getting hooked on the Florida snowbird gravy train, and I can’t say I blame them. There’s a lot of money to be had there, especially during the winter.

Then last week it came out that the airline was going to start cutting back on some of its long hauls. Bellingham and San Diego are disappearing while Burbank gets cut in half to only one daily flight. Sounds like the long hauls aren’t carrying their weight right now. It could be lack of demand for those routes in general or it could be lack of demand for the tight, no-frills product that the airline offers over long periods of time. I’d bet it’s a combination of both. So what are they doing with the planes that used to fly those routes?

Well, this week we got the big news that they were going to open a new base. Like Ryanair, they have “bases” meaning that they base a certain number of aircraft and crews in their largest operations. To date, Columbus has been the only base, but now we have . . . Greensboro.

Airline dorks (and Greensboro/High Point/Winston-Salem residents) will remember that airport as the home of many failed airline experiments. The grandest attempt was Continental’s old low fare division, CALite, which opened up a Greensboro hub in the mid 90’s, back when every airline thought that a low fare division was a good idea. (United still hasn’t figured out that it isn’t.) I actually remember flying through there once connecting from Baltimore to Atlanta on an old 737-100. So what makes Skybus think they can succeed?

What I’m sure the airline sees is an airport that doesn’t have much service at this point and is less than 100 miles away from both Charlotte and Raleigh/Durham. If the fares are low enough, they’re banking that they can fill the planes. Besides, Greensboro is also one of the destinations they already fly from Columbus, so they have an idea of what demand is like. It must doing well for them.

So what routes are they flying from Greensboro?

Besides Columbus, we once again have the Florida gravy train. St Augustine, Punta Gorda, and Ft Lauderdale all get flights, and I bet they’ll do well for them. They’re also serving Gulfport/Biloxi, another town that I bet will do well as the gambling mecca of the south. (I don’t think mecca is the right word for the place.)

After that it gets interesting. Portsmouth (New Hampshire) and Chicopee (Massachusetts) both get flights. I’m not convinced that those are going to generate much traffic at all, but I suppose we’ll find out soon enough. Then again, I have to think those will look like blockbusters compared to the last route they announced . . . Burbank.

Now, I’m surprised that they can even make this flight happen. Burbank has a short runway and that’s a long haul, so I have to think that an A319 with 156 seats is going to have some weight restrictions. But then again, they probably won’t be able to fill enough seats to worry about that. Delta can’t even support a daily flight from Los Angeles to Raleigh/Durham (it’s down to 5x weekly). I would be amazed if Skybus can find enough demand to fill half this plane.

So this is a lot of change for the young airline. On one hand, it’s good to see that they aren’t wedded to routes that simply aren’t performing. This capacity shift tells me that they probably are seeing success on some routes and they are realigning to better serve those markets.

It’s not entirely surprising to see the longer hauls not working out as well as they’d hoped. I mean, it’s a tougher sell to get people to stuff themselves into those tight seats for that long of a flight. And those routes have less demand overall anyway, so it was a long shot to begin with. It may mean we’ll see less of them out here on the west coast until they decide to open a base for short haul flying out this way, but until then . . . there’s always Florida.

Head on over to Skybus.com and you’ll see the brand new website launched this morning. (It’s been timing out on me a lot – not a good start.) They’re now taking reservations, and true to their word, they’re going to be flying by the middle of May. Initial promo fares start at $10 one way. First, let’s look where they’re flying.

All of these cities will be served from Columbus initially, though I really hope they get some non-Columbus routes going for their own sake. Oh, but be careful. In true Ryanair fashion, they’re serving nearby airports so this is a little misleading. Here’s the actual lineup. As mentioned, all cities are served only from Columbus to start:

Burbank (Los Angeles) – once daily on 5/22, twice daily on 6/12
Portsmouth, NH (Boston) – twice daily on 5/22
Kansas City – once daily on 5/22
Richmond – once daily on 5/23
Bellingham (Vancouver/Seattle) – once daily on 5/29
Greensboro – once daily on 5/29
Ft Lauderdale – once daily on 5/29
Oakland (San Francisco) – once daily on 6/12

So now that the schedules are out, we can also talk about the product. Everything that they’re doing is very consistent with the ultra low cost model, but it’s going to be a shock to a lot of travelers.

• Check In – They recommend doing it at home, but there are also kiosks at the airport. I’m guessing those are your only two options.

• Baggage – You can bring one carry on and one personal item onboard for free, but all checked bags cost money. It’s $5 per bag for the first two and then $50 per bag after that.

• Drinks/Snacks – You can NOT bring your own drinks and snacks onboard. How else are they going to make money off of you? You’ll have to pay onboard for any drinks or snacks you’d like to consume on the plane. They aren’t picky about how you pay though. All money is good whether cash or credit. Heck, they’re so desperate they’ll even take Diner’s Club.

• Inflight Entertainment – None. According to their Rules of Flying, you’ll have to bring your own.

• Legroom – If you don’t have any entertainment to bring onboard, you can just count the threads in the seatback in front of you. It’s going to be that tight. Let me put it this way. Those seats everyone whines about being too tight on United, US Airways, American, etc are usually at a 31″ pitch (proxy for legroom). Skybus will have 156 seats on their A319 aircraft. EasyJet in Europe has the same layout and it offers a mere 29″ pitch. Tall people might want to rethink flying these guys.

• Phone Reservations – None. Seriously. They don’t even have a phone number. It’s all email if you can’t find what you need on the website. I find that quite annoying personally. I would hope that at some point they at least get an online chat function up and running.

• Staffing – Not much. They’re going lean here. That’s why you won’t be able to check-in with an agent, and you won’t see gate agents at the gate until it’s time to board.

• On Time – They say you have to arrive at least 30 minutes prior to departure or you won’t get on. I wouldn’t mess with these guys on this.

• Refunds – None. Seeing a pattern here? There’s a $40 change fee but nothing is refundable. That’s not a bad deal, though if you bought a $10 ticket you’re better off throwing it away.

• Pre-Boarding – If you want to pre-board, that’ll cost you $10.

As you can see, this is definitely a different way to fly. I really hope that anyone who buys a ticket does their homework beforehand, because otherwise they’ll be in for a rude awakening when they get to the airport.

As far as I’m concerned, this is a great idea, but the key is on-time performance and route selection. I think markets like Oakland and Burbank are great, but Greensboro and Richmond? Hmm, not so sure, especially with 156 seats to fill on every flight. They’re going to need to get away from Columbus quickly and start moving into more markets that will support this type of service, but if they do it right, this could be big.