Set up your own Airline
Discussion
Harder than it looks!!!
www.reuters.co.uk/newsArticle.jhtml?type=oddlyEnoughNews&storyID=5120158§ion=news
Irish budget airline goes bust after a week
Wed 12 May, 2004 15:45
DUBLIN (Reuters) - Irish budget airline JetGreen Airways has ceased trading one week after its first flight as it became the latest victim of cut-throat competition in Europe's no-frills airline market.
The Dublin-based carrier, which began daily flights to the Spanish holiday destinations of Malaga and Alicante on May 4, said on Wednesday the decision had been "a matter of deep regret" and apologised to passengers who had been left stranded.
"We would like to thank all the people who have booked with us and apologise for the undoubted inconvenience this causes to their travel plans," JetGreen said in a statement.
JetGreen did not say how many people would be affected by the decision to wind up the company, but last week Chief Executive Pearse Gilroy told Ireland's Business & Finance magazine 40,000 tickets had been sold.
Passengers will have to make alternative arrangements to return home, it said, advising customers to seek reimbursement through their travel insurance companies or by applying to Ireland's Commission for Aviation Regulation.
No one from the company could be contacted on Wednesday.
JetGreen, which took delivery of its first aircraft, a Boeing 757, on April 30, was due to add flights to Nice, Faro, and Rome's Da Vinci airport next month.
The airline, whose slogan was "Fly the Difference!", aimed to be "the finest, most stylish low-fare, low-cost and high-service tour operator", offering more leg room than its competitors, in-flight entertainment and complimentary food.
In January, Irish regional airline Jetmagic collapsed after less than a year in operation, facing intense competition from rivals including state carrier Aer Lingus, which has realigned itself as a low-fare player following its own brush with bankruptcy in 2001.
www.reuters.co.uk/newsArticle.jhtml?type=oddlyEnoughNews&storyID=5120158§ion=news
Irish budget airline goes bust after a week
Wed 12 May, 2004 15:45
DUBLIN (Reuters) - Irish budget airline JetGreen Airways has ceased trading one week after its first flight as it became the latest victim of cut-throat competition in Europe's no-frills airline market.
The Dublin-based carrier, which began daily flights to the Spanish holiday destinations of Malaga and Alicante on May 4, said on Wednesday the decision had been "a matter of deep regret" and apologised to passengers who had been left stranded.
"We would like to thank all the people who have booked with us and apologise for the undoubted inconvenience this causes to their travel plans," JetGreen said in a statement.
JetGreen did not say how many people would be affected by the decision to wind up the company, but last week Chief Executive Pearse Gilroy told Ireland's Business & Finance magazine 40,000 tickets had been sold.
Passengers will have to make alternative arrangements to return home, it said, advising customers to seek reimbursement through their travel insurance companies or by applying to Ireland's Commission for Aviation Regulation.
No one from the company could be contacted on Wednesday.
JetGreen, which took delivery of its first aircraft, a Boeing 757, on April 30, was due to add flights to Nice, Faro, and Rome's Da Vinci airport next month.
The airline, whose slogan was "Fly the Difference!", aimed to be "the finest, most stylish low-fare, low-cost and high-service tour operator", offering more leg room than its competitors, in-flight entertainment and complimentary food.
In January, Irish regional airline Jetmagic collapsed after less than a year in operation, facing intense competition from rivals including state carrier Aer Lingus, which has realigned itself as a low-fare player following its own brush with bankruptcy in 2001.
eric mc said:
Forget it - it's a mug's game.
Far, far too competitive with extraordinarily narrow profit margins and an cripplingly high failure rate. I'd say about 80% of all airlines fail within 5 years of being set up.
Not just that but the current economic climate is just too hard to survive in. Sept 11th, terrorism fears, risk of DVT from lack of space/movement makes passenger numbers reduce.
The industry is far too saturated as well - you mentioned that, anyway.
Easyjet and Ryanair are undercutting mainstream player like BA, Virgin etc with their low prices but offer poor customer service, no food etc to make up for this. So either the mainstream players will have to compromise in what they offer or their price or the budget players will have to increase their price to offer essential services.
It's not just Septemner 11. It's always been tough. For the last two years "Aviation News" have been running an alphabetic listing of the history of every single airline established in Britain and Ireland since 1945. Most of them don't exist anymore - the majority having gone out of business (some disappeared through mergers and acquisitions).
5 Live this morning:
British Airways have at last posted a trading profit (£180m IIRC) after many months of dilligent hard work and prudent management.
Then, oil prices rise and looks set to cost the airline an additional £185m per year.
This, they say is not something that can easily be passed onto the customers.
British Airways have at last posted a trading profit (£180m IIRC) after many months of dilligent hard work and prudent management.
Then, oil prices rise and looks set to cost the airline an additional £185m per year.
This, they say is not something that can easily be passed onto the customers.
Yeah, don't forget that the increases in fuel costs are going to make it harder to make a profit, especially for new entrants.
There was a story a while ago about a low cost airline that started in New Zealand flying between New Zealand and Australia, and was doing a roaring trade with only one 747. However as it didn't have its own ground crew to turn the plane around in Sydney, it had contracted this out to ground crew who also were also contracted to Air New Zealand, New Zealand's main carrier. Big mistake! Allegedly one crucial piece of equipment failed on the plane while it was being turned around in Sydney, not once, but twice, in the space of a month. Apparently Boeing had no record of that ever having happened before and both times meant the plane had to sit in a hanger for days while the part was replaced while passengers had to be flown back to New Zealand on other airlines (including Air New Zealand!). Goes without saying that the low cost airline went bust. Its margins and schedule were so tight that it couldn't afford to have the plane out of service. Also, people were scared of being stranded and stopped flying with them.
For all you budding Richard Bransons, beware that it's a nasty business!
There was a story a while ago about a low cost airline that started in New Zealand flying between New Zealand and Australia, and was doing a roaring trade with only one 747. However as it didn't have its own ground crew to turn the plane around in Sydney, it had contracted this out to ground crew who also were also contracted to Air New Zealand, New Zealand's main carrier. Big mistake! Allegedly one crucial piece of equipment failed on the plane while it was being turned around in Sydney, not once, but twice, in the space of a month. Apparently Boeing had no record of that ever having happened before and both times meant the plane had to sit in a hanger for days while the part was replaced while passengers had to be flown back to New Zealand on other airlines (including Air New Zealand!). Goes without saying that the low cost airline went bust. Its margins and schedule were so tight that it couldn't afford to have the plane out of service. Also, people were scared of being stranded and stopped flying with them.
For all you budding Richard Bransons, beware that it's a nasty business!
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