OneJet “Temporarily” Suspends Its Flights, But a Return to the Skies Would Be Surprising

It was just two weeks ago that I wrote about ominous clouds hovering over OneJet.  Now there’s been another blow: flights and bookings have been suspended.  The company says it will resume selling tickets in October though the actual date for the resumption of flights is unclear.  I would be surprised if that actually happens.

I first noticed OneJet back in 2015.  The airline was founded by Matt McGuire and it had amassed a bunch of heavy hitters as advisors (Fred Reid, Ray LaHood, and more).  Backed by data, Matt felt that he was on to a big idea.  The airline would use small (7-seat) jets to shuttle business travelers back and forth between cities that had lost nonstop service over the years. 

At the time, I thought this was an interesting niche. The airline started up primarily out of Indianapolis and flew to cities like Pittsburgh, Milwaukee, and Memphis.  Sure these weren’t huge markets, but the airplanes weren’t huge either. If OneJet could find the less price-sensitive business traveler in each market, then it could work.

Apparently, the original plan didn’t work well enough.  In my first Cranky Flier Interview podcast in 2016, I interviewed Matt.  He said it was working well, but the airline had pivoted since its launch.  OneJet had all but abandoned Indianapolis in favor of Pittsburgh.  Why? Pittsburgh offered what Matt called a low-cost loan to the airline, and that made it worth making the move. Matt said the company was turning a profit.

If OneJet was working so well, then why would it completely uproot its operation for a loan?  If it was making money, it wasn’t making enough. OneJet wasn’t an operating airline and its initial operating partner Pentastar had limits on how many flights it could sell.  OneJet decided to move to a new partner, Corporate Flight Management (which became Contour), but that was more costly… so was additional aircraft acquisition.  The small profit wasn’t enough to fund the operation, so OneJet turned to airports.

Matt sounded almost cocky in our interview, saying that if airports wanted service they would have to contribute.  Pittsburgh did, and that’s why it got the promise of new flights.  But that turned out to be a double-edged sword.

OneJet’s Pittsburgh plans didn’t quite develop as hoped.  Service either didn’t perform as well as needed, or OneJet simply changed its strategy. The end result is that the growth that was promised to Pittsburgh didn’t materialize.  Normally that’s not an issue, but since Pittsburgh had skin in the game, it had the right to demand more.  Earlier this month, it sued OneJet for $763,000.  OneJet hadn’t just failed to live up to expectations, but it wasn’t paying fees in a timely manner.  As if that’s not enough trouble, the feds now have filed a tax lien for over $620,000.

OneJet had already begun to look at diversifying its operation.  Earlier this year, it moved into the Albany to Buffalo market, but it did so with 30-seat Embraer 135s, a big shift from its original model.  It took things even further when it announced in May that it would be buying Ultimate JetCharters.  Presumably the idea with that acquisition was to become an actual operator and not have to rely on a third party, but that plan failed when the acquisition fell apart.

Recently, in addition to the Albany to Buffalo flight, OneJet was down to only flying from Pittsburgh to Hartford and Indianapolis.  It looks like its relationship with Contour ended since all remaining flights were scheduled to be operated by its former merger partner, Ultimate, with Dornier 328 Jets.  That flying was quietly suspended and the operation shut down this week.

Seeing no information about the shutdown, I called OneJet’s reservation line and tried to book a flight. I was shocked when someone answered.  He hesitantly told me that there was a “temporary halt on all flights.”  Later yesterday, this appeared on the OneJet website:

One Jet will be transitioning its operations to a fully owned 135 operating certificate over the next 8 weeks. During this transition, we will be suspending scheduled services on current routes. Please accept our apologies for any inconvenience caused by this distruption [sic]; the result of this transition will be a more robust and reliable operation for our customers from the fourth quarter forward. 

We presently expect inventory to re-open for sale begining [sic] October 1st and will make additional information available at that time.

It would seem that the relationship with Ultimate deteriorated beyond just the merger to impact flight operations.  With no operational transition plan in place, OneJet was forced to shut down and try to reboot.  Canceling all flights for what seems like 8 weeks at best is going to be a huge blow to an airline struggling to gain traction.  And even that would be the best case scenario.  OneJet seems to have a list of enemies these days, and debts are mounting.  If OneJet finds a way back into the air, I’ll be amazed.

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Miss Informed
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Not the first (and won’t be the last) airline to find that its niche turns out to be a black hole. My condolences to the investors.

Dan
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Crank,

I’m with you. The problem with these niche operators trying to go after the “less price sensitive” market is that the less price sensitive market already has options… that don’t require any schedules whatsoever. People with the bucks have their own planes or charter their own planes. I just don’t see how one can compete for that market and not offer the day-of flexibility that a charter or owned-aircraft gets you.