Airlines We Lost in 2007

Airlines We Lost, Harmony, MAXjet

As we approach the end of 2007, it’s time to follow up the tradition I started last year with a tribute to those airlines that won’t make it until 2008. Ok, maybe two years doesn’t make a tradition, but I have to start somewhere.

Of course, this doesn’t include every single airline worldwide that went out of business this year. I mean, there would probably be a million of them in Nigeria alone. So, I’ve culled the list down to some of the most notable for one reason or another. If you think I’ve left one out that should be recognized, leave a comment below.

So, here they are in the order which they shut down this year. May their employees all find new jobs with ease.

07_12_31 hftombstoneHapag-Lloyd – January 2007

Back in 1972, the recently created shipping conglomerate Hapag-Lloyd decided it was time to start an airline to serve its own purposes. I can see the thinking now . . . “we have a bunch of cruise ships and need to get people to them. I know, let’s start an airline!” That strategy has rarely worked in the past, but over the years, Hapag-Lloyd grew to operate more than 30 aircraft in the charter market until they were swallowed up by the giant TUI. This year, the airline’s name disappeared as TUI began operating all flights under the incredibly un-catchy name TUIfly. While the name may be lame, you’ve undoubtedly seen them buzzing around European airports with their frightening powder blue livery.

07_12_31 7mtombstoneAtlantic Express – January 15, 2007

Poor Atlantic Express. Their mission was very simple . . . fly people from the tiny island of Jersey (off the coast of France) back to London. Their airport of choice? Stansted. Unfortunately for them, you can fly FlyBE to Gatwick, British Midland to Heathrow, VLM to City, and even ThomsonFly to Stansted itself. Needless to say, an airline solely focusing on this route isn’t going to last very long. And they didn’t. Oh sure, there are rumors that they’re going to be revived, but I wouldn’t put much stock in those.

07_12_31 6qtombstoneSlovak Airlines – February 2007

The tale of Slovak Airlines is a bitter one. Back in the mid-1990s, newly independent Slovakia saw the Czechs take the airline they used to share. (Well, they did fly mainly out of Prague.) So what did they do? They got some private investors to start up an airline of their own. As you might have expected, the airline did terribly and in 2005 they turned to Austrian Airlines (not exactly a shining star of profitability itself) to take a controlling stake. Two years later, Austrian was so frustrated with the government’s unwillingness to hold up its end of the bargain and fork over some cash, that they pulled the planes out from under Slovak Airlines and the airline disappeared like that. So there.

07_12_31 shtombstoneFlyMe – March 2, 2007

I’m not sure that there was really anything remarkable about FlyMe. They were just another airline that got caught up in the low cost carrier frenzy of early 2000s Europe. For some reason, several airlines thought that these generic and annoying names stating that yes, they actually do “fly” would bring them riches. Please don’t confuse them with FlyBE, FlyNordic, TUIfly, Flyglobespan, or Thomsonfly. FlyMe was based in Sweden and brought people from the frozen north down to warmer spots in Europe. Many other airlines had this idea as well (go figure), so the airline never made it very far.

07_12_31 3ctombstoneRegionsAir – March 8, 2007

Though we didn’t see much activity in the first couple of months of 2007 in the US, it picked up in March with the shutdown of RegionsAir. Who? Well, RegionsAir was one of those EAS airlines. They took government money from the Essential Air Service program to fly people to little towns that had very little demand. (The awful EAS program warrants a big long post of its own sometime.) Most recently it was flying as American Connection and Continental Connection from the hubs to places like Fort Leonard Wood, Missouri. (Motto: Our name is more entertaining than our town.) The EAS world is a hard one to make work these days, and that’s why you’ll see airlines like Big Sky on this list next year. But, RegionsAir didn’t shut down for financial reasons. Nope, they were forcibly shut down by the FAA for training problems. Yikes. They keep saying they’re under new management and they’re going to come back bigger and better than ever. Uh huh. That hasn’t happened, and I wouldn’t put any bets on it.

07_12_31 sntombstoneSN Brussels and Virgin Express – March 25, 2007

We’ve got a two-fer here, but it’s not a sad ending this time around. SN Brussels and Virgin Express merged to form Brussels Airlines, a new carrier that hopefully will not overserve Belgium as has been tradition for years and years. You may be surprised by the early start date of SN Brussels. Many people think it was created to replace Sabena after it shutdown in 2001. But no, it actually was Delta Air Transport beforehand. When Sabena shutdown, the Belgians transformed DAT into SN Brussels and anointed it as the flag carrier. The death of this airline marks the end of the stylized “S” logo that Sabena used to use as well.

Virgin Express, on the other hand, is a reminder that not everything Richard Branson touches turns to gold. It was never a very successful operation despite its early entrance into the European low cost carrier market. It really ended up being more of a pest to Sabena and SN Brussels than a real threat for world domination. This is probably one of the brighter spots on the list this year, because a merger should help the fortunes of both parties.

07_12_31 lbtombstoneLloyd Aereo Boliviano (LAB) – April 1, 2007

The story of LAB is a long and proud one. Um, well, until the end. LAB was one of the oldest airlines operating in the world with roots going back to 1925. The only airline predating them in South America was Avianca. Incredibly, the airline survived throughout the years, and even thrived at some points. Unfortunately, the death spiral began in the 1990s and there was very little chance it would recover. Brazilian-disaster VASP took a stake for awhile and proved that it could hardly run itself, let alone a successful partnership. LAB teetered back and forth until this year when the government finally euthanized the airline. There continues to be talk of resurrecting the airline once again, but I wouldn’t expect to see that succeed any time soon.

07_12_31 hqtombstoneHarmony Airways – April 9, 2007

Ah, Harmony. These guys had one of the more colorful histories. Well, it wasn’t the airline itself – it was the CEO. Dr David Ho founded the airline as his personal play toy. He basically decided that he didn’t like the way airlines treated him, so he thought it would be good to start his own. The airline went in and out of routes on a whim, depending how Dr Ho felt that day. But that wasn’t a crime. His only crime was, well, being caught with hookers and blow. I’m not kidding. Just a month or so before the airline shut down, Dr Ho was found driving high on coke with a couple of hookers in his car. Now there’s a role model for you. Shortly after, the airline folded. Related? Probably not directly, but well, you know.

07_12_31 peacetombstonePeace Air – May 18, 2007

I’ll bet you’ve never heard of Peace Air. I know I had never heard of them before I started looking into this post. But Peace was a long-time airline based in Peace River, Alberta that folded under financial pressure this year. Some say it was just the tough competition from Air Canada and WestJet while others say it was the inability to fly to Edmonton’s City Centre airport for various reasons. Either way, things weren’t adding up and the airline had to shut down. It’s always sad to see these little guys give up the fight.

07_12_31 uqtombstoneO’Connor Airlines – December 14, 2007

Our entry from down under this year is O’Connor Airlines. They just shut down within the last couple of weeks. O’Connor had a laundry list of problems highlighted in their press release announcing their closing. “Ongoing trading losses, declining customer support, flight crew shortages and significant aircraft maintenance issues also contributed to the decision to immediately cease operations.” Yeah, I’d say that the odds were stacked against them here. O’Connor was based in Mount Gambier but the only city they flew in the end that non-Aussies would recognize is Adelaide. I’d say this one appears to have been coming for a long time.

07_12_31 mytombstoneMAXjet – December 24, 2007

And now, for the one for which you’ve all been waiting. After a couple of weeks of speculation following a suspension of trading of shares, MAXjet shut its doors on Christmas Eve, making Santa find an alternate route for delivering presents at an affordable price in a seat in which he could fit. What happened? A lot. There’s no question that high fuel prices were problematic, especially on gas guzzling routes to LAX and Vegas. We know Washington/Dulles never worked for them despite multiple attempts. And New York? Well, there was crushing competition there.

I continue to believe that there’s something to this model, but it may just not be the right time. With fuel prices where they are, there just isn’t much hope. You’ll hear Eos and Silverjet crowing about how great they’re doing, but that’s just not possible. I can’t imagine they aren’t bleeding. It’s just very difficult to generate the revenue necessary to offset those costs these days when you have so few seats. It wouldn’t surprise me to see some more casualties in this market in the next year, I’m sad to say.

That’s it for this year’s addition. Let’s hope that we see Alitalia on this list next year. (What, you thought I could get through this without a snarky Alitalia comment?)

I don’t know if I’ll post again this year, so if not, I hope you enjoy the long weekend. I hope you’ve enjoyed my crankiness this year. I look forward to more crankiness next year.

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8 comments on “Airlines We Lost in 2007

  1. your list may not be done just yet…

    “The Italian government has given its backing to Air France-KLM’s proposal to buy Alitalia.”

    The loss-making airline will now enter eight weeks of exclusive talks with its preferred bidder, Italy’s Economy Minister Tommaso Padoa-Schioppa said.

    …more at:

  2. Nick Barnard wrote: “EAS always seemed like a reasonable idea to me.. I’d be saddened to see Big Sky go…”


    Sorry, Nick, but I have to disagree. It’s a false market. If there were truly demand for air service to these cities, the taxpayers wouldn’t need to pay for it. And, trust me, we pay dearly. In many cases, these EAS carriers go in, suck up the grant money and then bail. I can’t tell you how many times I flew from CDC to SLC on a 30 pax EMB with 1 paying pax. It was usually all non-revs from SGU.

  3. Ahh RegionsAir, how I will miss flying in your little Jetstream 31’s. In the post 9.11 world, it was always a pleasant change to fly on planes without cockpit doors.

  4. One thing about MaxJet though was that their business class product was utterly unimpressive. You probably know better than I do, but it seems that EOS at least has a decent product that would attract people. It’s still got to be a challenge to get people to fly a commercial carrier to Stansted, though. If your company is paying for business class, you might as well fly BA, AA, or VS and get into LHR, right?

    I’d never heard of Harmony Air before, so that was interesting. Particularly that he owned it wholly! If he had enough money to start an airline, he probably had contacts who could have shared the risk, but I’m guessing anyone he would have asked would have laughed at the business plan, eh?

  5. Alex C – Very true that it was unimpressive, but I think that was their niche. They were going for the price-conscious traveler. For their prices, you couldn’t get business on anyone else, so this was better than coach by a lot. Eos definitely has a far superior product, but you’ll also pay more for them. They’re really going for the business class traveler who wants to save money and get an equal if not superior product. As for LHR, that’s not always the best. Stansted is convenient for Canary Wharf, connections to low cost carriers, and many other places around London.

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