Another Valiant Attempt
Yet another ultra-low cost air carrier tests the waters.
I wish these guys all the luck in the world but none of these firms succeed over time. I remember Air Atlanta which was a totally kick-ass low-cost carrier years ago who were undone by the airline unions. People Express. Others.....
7 comments:
They ask passengers not to bring their own food? That's not really cool.
Yeah, but asking and forbidding are two different things.
I remember Legend Airlines. Wanted to fly smaller jets from D/FW to Vegas and a couple of other cities. American and SW were sh***ing their drawers, and basically made them use all their startup capital defending their right to exist and fly. They lasted about seven months.
It was Dallas Love Field, not D/FW -- sorry, my bad.
Skybus, the new Columbus-based airline that offers some tickets for $10, got off the ground Tuesday with its first flight, a 9:36 a.m. departure to Burbank, Calif.
That'll get it off to a good start. $10 a ticket. :-)
The only low-cost airline to survive long term, as far as I know, has been Southwest but they've morphed into Yet Another Big Carrier.
Gonzo wrote: "I remember Air Atlanta which was a totally kick-ass low-cost carrier years ago who were undone by the airline unions. People Express. Others....."
I had to write to a friend of mine who was in at the beginning at People Express. Here are his comments (of course, you'll say your comment was about Air Atlanta, even though you made the generalization ;-)
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Hi Susan.
The old “they got too big too fast” excuse really isn’t the reason. We were competing against American Airlines, Eastern and Continental at the time. They had huge distribution systems (Highly sophisticated Reservation computers and total control over the Travel Agencies / Agents (remember them?). They were able to match our fares on a limited seat basis and when those seats were gone they could sell the more expensive seats. Actually American invented the system that is in place now because to compete against PEX. The system is still in place today and is used by all airlines. (i.e., some seats are sold at cheaper fares, and then some a little more expensive, and then the day of departure if you need to book a seat it will cost an arm and a leg) PEX did not have that level of sophistication. Initially we were using our own reservation center and wanted customers to call us directly. It was the only way to book a seat. If you went to a Travel Agent they would have to call our reservation center to book the seat. TA’s did not like that at all. It didn’t help that we weren’t paying a commission to them either. They tried to book the customer away from PEX because they wanted the commission. Eventually we saw the need to go with the mainline distribution system and we “rented” space on the various systems so the TA’s could access us directly from their computers. Guess what? We had to pay a commission …but it was 15% of a cheap ticket and the TA’s thought it was still too much work for a small commission. They still booked away from us. (And they didn’t like us much because we had dissed them originally)
Add to all those booking problems the fact that our Finance team was not “watching the store” as it should have been and was letting money “fly” out the door, and we got into some $$ problems in 1985-86.
The idea was great (heck now cross utilization, employee ownership is the normal way to do business, and many of the precepts we “invented” are being used throughout many industries) and maybe before it’s time. But it was a great learning experience.
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And when I asked him about unions being the downfall (as you suggested), he wrote:
whoever thinks this has his (or her) head up their behind. People Express employees were not unionized. That’s what allowed us to be as flexible as we were.
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