With the collapse of three US airlines in less than two weeks and Oasis Hong Kong Airlines http://www.oasishongkong.com/gb/en/home.aspx ceasing flying and being placed into administration on Wednesday (9 April) the airline industry can not be a happy place at the moment.
Aloha Airlines http://www.alohaairlines.com closed up shop on 31 March after flying around the Hawaiian Islands for some 60 years. American Trans Air http://www.ata.com (ATA) stopped passenger flights on 2 April after flying for 35 years and Skybus http://www.skybus.com a US low-cost airline stopped flights on 5 April. All seemed to sight increasing fuel costs as the reason (at least in part) for their demise.
It has been well publicised that Alitalia is on shaky ground and has been losing money for years. The Italian Government has found no one willing to invest or take on the ownership of the carrier and its long term future remains uncertain.
We all like a bargain flight and dislike what seem to be ever increasing fuel surcharges and Mr Brown's / Mr Darling's "eco" tax increases but perhaps the time is coming that we are going to have to face up to paying more when flying or risk turning up at the airport to find no plane to take us on our trip.
I certainly don't buy into the media storiesof cheaper transatlantic flights with the "Open-Skies" liberalisation that changes the rules about flying between Europe and the USA - or those stories of the £7 Ryan Air flight to America http://business.timesonline.co.uk/tol/business/industry_sectors/transport/article1647610.ece.
With fuel at the current price it seems to be a pipe dream.
Even if Ryanair only charged £70 for a transatlantic flight I wouldn't fly with them.
I'm surprised that a lot of the US carriers stay in business, their product is usually inferior to Asian or most European carriers. I think we may see a few more carriers going out of business over the not too distant future
I'm surprised that a lot of the US carriers stay in business, their product is usually inferior to Asian or most European carriers. I think we may see a few more carriers going out of business over the not too distant future
Another 2 US carriers files for Chapter 11 protection yesterday - as said, this is the thin end of the wedge!
Jet
Jet
Jetnoise, there was an article in the Bulgarian Newspapers this week, citing a worrying time for Bulgarian Airlines due to the "Open Skies" agreement. Tonyt.
Seems Frontier Airlines has now gone into Chapter 11. Shame, I used them only in January to fly between Denver and Orlando and they seemed good.
In this case they plan to continue flying while they restructure. Hope it works out for them.
http://www.bizjournals.com/eastbay/stories/2008/04/07/daily82.html
Who's next?
In this case they plan to continue flying while they restructure. Hope it works out for them.
http://www.bizjournals.com/eastbay/stories/2008/04/07/daily82.html
Who's next?
More airline failures forecast amid credit crunch
A warning of further airline collapses came today in the wake of nine failures so far this year compared to five in the whole of 2007.
Default and insolvency insurance supplier International Passenger Protection says it has been inundated with calls from travel agents and online travel companies who have suffered losses from the failure of carriers like MAXjet, ATA, Aloha Airlines and Oasis Airlines Hong Kong, where reports indicate around 30,000 passengers are out of pocket.
Denver-based Frontier Airlines filed for Chapter 11 bankrutpcy protection last week but operations are continuing.
IPP director Paul Mclean said: "There are many factors that can put pressure on an airlines finances and at the moment.
"The current credit crunch and highest ever oil prices are simply reversing the hard efforts of many airlines who went back into profit after costing cutting exercises subsequent to September 11th.
"Unfortunately we expect several other airlines to come into the same difficulties during this difficult period."
He added: "We are certainly seeing a dramatic increase in requests from travel industry to protect not only their customers but themselves with insurance covering airline bankruptcy simply because they have sadly learned the hard way by losing money on these latest airline casualties.
"The oil and credit crunch factors highlight the increasing reasons that cause bankruptcy in airline market and of course we should not ignore the other sectors of the travel industry that are also under great pressure."
With permisison from Travelmole
A warning of further airline collapses came today in the wake of nine failures so far this year compared to five in the whole of 2007.
Default and insolvency insurance supplier International Passenger Protection says it has been inundated with calls from travel agents and online travel companies who have suffered losses from the failure of carriers like MAXjet, ATA, Aloha Airlines and Oasis Airlines Hong Kong, where reports indicate around 30,000 passengers are out of pocket.
Denver-based Frontier Airlines filed for Chapter 11 bankrutpcy protection last week but operations are continuing.
IPP director Paul Mclean said: "There are many factors that can put pressure on an airlines finances and at the moment.
"The current credit crunch and highest ever oil prices are simply reversing the hard efforts of many airlines who went back into profit after costing cutting exercises subsequent to September 11th.
"Unfortunately we expect several other airlines to come into the same difficulties during this difficult period."
He added: "We are certainly seeing a dramatic increase in requests from travel industry to protect not only their customers but themselves with insurance covering airline bankruptcy simply because they have sadly learned the hard way by losing money on these latest airline casualties.
"The oil and credit crunch factors highlight the increasing reasons that cause bankruptcy in airline market and of course we should not ignore the other sectors of the travel industry that are also under great pressure."
With permisison from Travelmole
The merger between Delta and Northwest Airlines will certainly consolidate services around the USA and beyond. Looks like the merged carriers will now be the largest in the world.
Shame about Skybus - I liked their ideas. Chapter 11 for Frontier may help them to see through this period.....after all just about every main US carrier has filed Chapter 11 at some stage.
Nivsy
Shame about Skybus - I liked their ideas. Chapter 11 for Frontier may help them to see through this period.....after all just about every main US carrier has filed Chapter 11 at some stage.
Nivsy
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