Tracking the Ever Changing Airline Industry

Cabin Managers has been tracking the airline industry closely for several years now, but the past six months has been a particularly active time for the airlines. Last Christmas, MAXjet Airways quit flying and, since then, more than a half dozen other air carriers have gone out of business including EOS Airlines and Silverjet who, along with MAXjet, comprised the three business class airlines serving the popular New York to London air route.

One airline that has managed to hang on is tiny L’Avion, the trading name of Elysair, a French operator based in Paris. L’Avion operates two Boeing 757-200 with 90 Business Class seats only, flying between Paris (Orly) and New York (Newark) twice daily, 5 times a week. We’ve expected that their long term survival was in jeopardy given the present market conditions and on Wednesday our suspicions were confirmed, but in a rather pleasant twist.

BA Acquires L’Avion

British Airways announced earlier this week an agreement to acquire L’Avion and integrate the airline into its new subsidiary OpenSkies. OpenSkies began providing service between Orly Airport and John F. Kennedy Airport recently and the combined operation will operate up to three daily flights between Orly and the New York area using Boeing 757 aircraft.

“L’Avion has built a fantastic business offering high-value premium service that has inspired tremendous customer loyalty on both sides of the Atlantic,” said Dale Moss, Managing Director of OpenSkies. “Together, we share common values and a deep commitment to safety, innovation and customer service. L’Avion will provide OpenSkies with immediate scale, increased access to Paris Orly and an experienced, talented employee base. This is a combination of two companies that are focused on bringing comfort and personalization to transatlantic travel.”

“We are thrilled about this agreement, which brings together two like-minded airlines with complementary business models and a focus on low costs and high value to create a premium transatlantic carrier,” said Marc Rochet, Chief Executive Officer of L’Avion. “We look forward to being a part of the high-quality customer experience that will become synonymous with OpenSkies, all backed by the vision of British Airways.”

Code Share Agreement

The deal is pending regulatory approval, but once that has been accomplished customers of the newly combined entity will be eligible to experience important benefits including an increased schedule and BA Executive Club privileges. At present, OpenSkies and L’Avion operate a codeshare agreement with L’Avion selling seats on OpenSkies flights.

Once we see how everything unfolds Cabin Managers will update the information for L’Avion listed on this site’s sidebar.

(Source: British Airways)

Pictured: ExpressJet co-workers, Rose Morgan and Lo Lyons, prepare their team’s float for the Susan G. Komen Foundation’s Race for the Cure. (PRNewsFoto/ExpressJet)

Airline news has been particularly bleak this year as a rash of air carriers call it quits and as many other airlines struggle to survive. If you’re a regular visitor to CabinManagers, then you are familiar with the frequent reports of one airline after another going out of business.

In the midst of all of this, it is always good to find the occasional ray of light which manages to penetrate the darkness. One company, ExpressJet Airlines, has been shining a bright light lately, in the area of giving back to the community. The following story tells how several ExpressJet employees banded together for different worthy causes and made a difference in the process:

After she, her mother, and her aunt, were simultaneously diagnosed with breast cancer, Lyons sprang into action for the cause of early detection for all.

“This cause was close to me, and many of my closest friends are my co-workers,” said Lyons. “We formed a walking team and raised money for the Susan G. Komen Foundation’s Race for the Cure. My company and my co-workers have been some of my greatest supporters.”

Employee morale at work also gets a boost from employee charitable efforts after hours.

“Today’s employees are concerned about whether the values of the company for which they work are compatible with their own personal viewpoints,” said business consultant Roger E. Herman.

Mark Silver, a retired Navy pilot and motorcycle enthusiast who flies for ExpressJet Airlines, joined the first annual Texas Honor Ride to raise money for wounded soldiers and their families. The group of motorcycle clubs rode across the state to Brooke Army Medical Center in San Antonio. With one email, Silver kick-started a movement that spread through the company.

“To be able to ride together, as a team, as co-workers, and to be able to give something back to those who gave us so much, truly made us proud of ExpressJet,” Silver said.

Kudos to ExpressJet for creating an environment where workers can make a difference whether they are at work or working together on their own time. For the complete article and tips on how to organize an event like the two mentioned here, please visit ExpressJet Airlines.

ExpressJet Remains Independent

Until 2002, ExpressJet was a unit of Continental Airlines before the airline was spun off in a public offering that raised $500 million. ExpressJet had received an offer in April 2008 from SkyWest Airlines to buy ExpressJet at $3.50 per share, but that offer was rejected. Instead, ExpressJet renegotiated its regional service agreement with Continental and will provide 205 jets to serve Continental going forward.

Business class airlines flying from the New York metropolitan area to London just cannot catch a break.

One, Two, Three Bankrupt Airlines

First, it was MAXjet Airways who folded just before Christmas 2007, leaving passengers scrambling in a bid to get home. Plans to re-launch the carrier as a charter operator apparently are on hold.

Second, it was EOS Airlines who announced this Spring that their elite business class service was through, citing rising fuel prices and competition for its demise. EOS’ claim to fame was its introductory $6500 roundtrip airfare, with 48-passenger seating and amenities rivaling what corporate jet fliers receive.

Third, and last, is Silverjet the British-registered airline that recently seemed to have worked out a key funding plan which would have rescued the airline, but today Forbes has reported that the airline has been shut down and all 300 employees fired. Silverjet had suspended operations two weeks ago when it ran out of cash, but an Irish suitor canceled the deal.

Sardine Class, Anyone?

All three airlines sought to carve out a niche abandoned by the SST market after the last of the aging aircraft were pulled from Air France’s and British Airways’ fleets. Though no one was promising to get passengers back and forth across the Atlantic quickly, the business-style air carriers could at least do it in style, something the legacy air carriers weren’t doing.

Alas, the New York-London business-class only market is now dead. Businesses will have to choose whether to fly corporate or to catch a flight on one of the big American or British air carriers, flying choices which are at polar opposites of each other.

Flying as United Airlines, the newly-merged airline is expected to keep its headquarters in Chicago, but be controlled by USAirways management. USAirways was bought out by America West in 2005, but the airline kept the better known USAirways name.

We’ve Been Down This Road Before

If the United-USAirways deals sounds familiar, the Chicago Tribune recently reminded its readers that these airlines had announced a deal in 2000, that collapsed 14 months later. Opposition from regulatory and union officials ditched those plans and a slowing economy was also being blamed for the earlier collapse.

Gates To Open Up

Certain east coast US gates controlled by USAirways and United could suddenly be freed up if the merger goes through. Likely, regulators would force the newly-merged entity to cede gates at important airports, including Reagan National in Washington, DC, allowing JetBlue, Virgin America, and Air Tran to bid on available gates.

Other Industry News

Most of the merger talk these days has come about as airlines face record jet fuel prices. A rash of smaller airlines have already declared bankruptcy with several closing their doors permanently. However, a few airlines are hoping to make it through the current crisis including:

• Frontier Airlines is receiving protection in bankruptcy court and has permission to sell off four aircraft in a bid to pay off loans and raise cash.

• Virgin America plans on adding O’Hare Airport to its itinerary. The airline has petitioned the FAA to receive two gates and eight arrival slots at the busy airport long dominated by United and American Airlines.

• Silverjet, which is the last of three air carriers flying business class only passengers between New York and London (after MAXjet and EOS’ demise) has been in talks with Lufthansa and other interested parties to purchase the airline. However, Silverjet CEO Lawrence Hunt is reluctant to sell citing market conditions as the chief reasons to keep Silverjet off the market.

Oil Dips Slightly

One glimmer of light for the airlines is the price of oil which actually dropped slightly by 56 cents to $125.40 for June crude delivery. Not that bright of a light, that is for certain, but one the airlines can use if only for the moment.

Southwest Airlines, the budget air carrier who has been gradually and methodically transforming itself for decades into a national powerhouse, remains the best loved airline in the eyes of the business community. In a recent survey, Fortune magazine bested Continental Airlines as the most admired U.S. airline.

Thumbs Up For American Too

While the news for Southwest, Continental, and American (which also did well) was good, the flip side is that all four airlines which went through bankruptcy over the past several years brought up the rear. United, USAirways, Northwest and Delta were the least admired airlines as was SkyWest which hasn’t gone through bankruptcy. Many customers have been complaining that the service on these impacted airlines is deplorable something Southwest has been able to avoid.

Airlines Under Attack

The airlines have been under a relentless attack for many years now as higher fuel prices and the effects of airline deregulation close in. The terrorist attacks of September 2001 fueled the decline, putting even the strongest airlines in a grave position. Add in all of the security requirements and the removal of basic amenities and it is no wonder that passengers are unhappy.

Southwest has managed to buck the trend by offering a working environment many employees compare to family relationships. Unlike the management-employee polarization prevalent at most air carriers, Southwest has managed to cultivate and sustain a good working environment despite the added pressures. Indeed, Southwest has been profitable for 35 consecutive years, an unheard of feat in aviation.

Check Them Out

Although I haven’t included Southwest on the list of CabinManagers recommended airlines (for the simple reason that their starting pay is low) I can unequivocally say that they are perhaps the best airline to work for from an employee satisfaction standpoint. Unfortunately, Southwest isn’t hiring flight attendants right now nor are they accepting applications. Keep an eye on their career page in the event that this should change.

Further Reading

He Gave Southwest Its Wings

Southwest CEO describes 2008’s challenges

Now Boarding Business Class

(Source: Dallas Morning News)

Logo copyright/courtesy of Southwest Airlines.

Legacy Air Carriers

Both Northwest and Delta are considered legacy carriers, airlines that got their start in the earliest days of commercial flying. In 1926 Northwest Airways came to life and two years later Delta Air Service was launched. Along with American, United, Continental and USAirways, the Big 6 are the nation’s oldest air carriers.

Battered By Bankruptcy

Both airlines fared extremely poorly following the terrorist attacks of September 11, 2001, hastening a decline that had begun many years earlier. High overhead, surging fuel costs, and management-labor issues have hampered these airlines. As a result, both airlines lost tens of billions of dollars and shaved their respective workforces by thousands of employees.

The World’s Biggest Airline

A NWA-Delta merger would immediately create the world’s largest air carrier, which is likely to begin a wave of additional consolidations particularly in the US. Combined, the newly merged entity would have a fleet of more than 800 aircraft at their disposal, not including previously ordered aircraft.

Don’t Look For A “Now Hiring” Sign Anytime Soon

Prospective employees who are looking for work with the new air carrier are likely to find the pickings slim. Additional crew layoffs are expected and a downsizing of overall operations will take place. Instead, opportunities at current NWA-Delta subsidiaries such as Mesaba Airlines, Compass Airlines, and Pinnacle Airlines should still be available.

Prospective flight attendants should know that employment opportunities at some air carriers are likely to change rapidly this year. Due to sustained (and high) fuel prices, some airlines are finding the going very difficult and are looking at new partnerships to help them weather the crisis. The impact on new flight attendants could be strong as newly merged entities lay off excess crew and seek to streamline their operations.

Who Is At Risk?

Anyone looking for work at a legacy air carrier — American, United, USAirways, Delta, Continental, and Northwest — probably is familiar with the difficulties each airline has been experiencing over the past seven or eight years. While American and Continental have staved off bankruptcy, the others have not.

USAirways was bought out by America West who promptly jettisoned their own name in favor of the much more established and universally known USAirways.

United, Northwest, and Delta have gone through historic losses, losing tens of billions of dollars between them and reducing staff. Out of the three, United is the strongest with Northwest and Delta considering a partnership or outright merger.

Thus, working for an established air carrier (if they are hiring) offers a great risk especially if fuel costs remain high or spike upward.

Should I Go Regional?

Besides the recommended airlines listed on the sidebar of this page, who else might the prospective flight attendant consider? Regional operators continue to hire but their pay ranges from $12-17K annually, low enough to allow workers to qualify for food stamps.

JetBlue has a newer fleet, but along with Frontier and SkyWest, this air carrier reported some of the largest drops in their respective stock prices this week.

Wait It Out Or Jump In

For the person who absolutely wants to fly, there is no time like the present for seeking work. Quite frankly, airlines are always hiring. Just be prepared for what some are considering the inevitable, that your airline may be merged, go out of business, or lay off crew. If you’re eager to start flying, then join up, but if you’re looking for job security, the airlines cannot give that to you.

Out of all the carriers flying in North America, Southwest Airlines is probably the strongest. Although they say that they are hiring flight attendants, Southwest is not accepting new applications.

EOS Airlines and Silverjet are the two remaining air carriers in the mix and now it appears that Silverjet is running into financial difficulties as well. Bloomberg News is reporting that the airline was only able to fill 54% of its seats for the month of January, well below the amount the air carrier needs (64%) in order to turn a profit.

Silverjet began flying in January 2007 and has promised to begin to turn a profit by March 2008. However, high fuel prices are impacting the airline and the airline’s stock value has dropped as much as 80%. Established air carriers including British Airways have vowed to match Silverjet’s service, putting added pressure on the airline.

In light of this news, CabinManagers is cautioning applicants who are considering employment with Silverjet at this time. Until the airline’s financial picture improves we cannot encourage you to seek work with Silverjet right now.

Please bookmark this page to track additional updates for Silverjet. Subscribe to a feed and register with the blog to keep tabs on all CabinManagers updates.

Co-owned by IAMSA — the Mexican bus company — and RyanMex — owned by the Ryan Family which owns and operates low-cost Irish carrier, RyanAir — VivaAerobus will be commencing U.S. service on May 1st.

Not every seat will be sold for the $9.99 price which does not include fees and taxes which would push the fare up to about $55 each way (compared to $421 or higher round trip with some other air carriers), but seats are available at that price for typical black out periods including July 4th.

VivaAerobus — which bill’s itself as Mexico’s low fares airline — is strictly no frills with no food or drinks included, although both are available for purchase on-board. Boarding and seating is first come first served; passengers may check one bag, but additional bags will be checked for a fee.

The airline presently operates a fleet of five Boeing 737-300 jetliners. Its base of operations is in Monterey with 19 Mexican cities currently served. Check out their route map for more information.

Job opportunities with VivaAerobus are posted on their website in Spanish as candidates must be fluent in that language.

(Source: www.star-telegram.com)

MAXjet was listed as one of the “recommended” air carriers on this site until one of our readers, Nicole Barrett, questioned why I was still featuring them. I realized I should have pulled their information earlier in the month when it became apparent that MAXjet was not going to fly again. It is the policy of CabinManagers to remove bankrupt air carriers from the recommended list even if there is a chance of restructuring and flying again at a later date as working conditions (pay, benefits, etc.) generally slips when an airline reorganizes. In MAXjet’s case this airline appears to be gone for good, therefore I apologize for not removing their information sooner.

MAXjet’s failure provides a number of lessons when it comes to seeking employment in the airline industry, particularly as a flight attendant including:

New air carriers have a difficult time surviving. Shiny, new aircraft are great but they do cost money to maintain, lease payments must be made and fuel costs are always a concern. One of the downfalls for MAXjet was fuel prices and increased competition. Silverjet and EOS provided some of the competition, but American Airlines’ entry into the New York to Standsted market in October 2007 likely hastened MAXjet’s demise.

Things can start out good, but watch out. One reason why some people prefer working for a new air carrier is that the working conditions are generally much better than what the established airlines offer. New employees at some upstart air carriers start at a higher rate than new employees with an established airline, due in part to union agreements which preserve the pay structure of senior flight attendants while allowing newbies to work at a lower scale (this varies from airline to airline). Signs of an airline’s demise include: trouble meeting payroll, canceled flights, reduced passenger load, higher fuel costs, employee turnover, etc. Many times these signs aren’t always apparent, even to flight crew, who are just as surprised as their passengers when an airline suddenly quits flying.

Expect several career moves as a flight attendant. Unless you are fortunate enough to get in with the right air carrier from the get-go, there is a good chance your flight attendant career will mean working for several airlines. Gone are the days of lifetime employment, at least with most airlines. Instead, when an airline dies you will find yourself seeking employment elsewhere, perhaps losing seniority and pay as go to a different airline. Likely, many former MAXjet flight attendants will simply leave the airline industry instead of pursuing employment elsewhere — getting burned is no fun!

After MAXjet, Now What?

MAXjet’s failure is shining the light on its two main competitors — Silverjet and EOS Airlines — as two airlines in line for trouble. Recently, Silverjet’s CEO Lawrence Hunt had to counter reports that his airline was “doomed to fail” an observation made by an industry broker. Silverjet insists that their position is fine, with delivery of two new aircraft due before the summer. Silverjet is looking at new markets including Miami, the U.S. west coast, South Africa, and elsewhere. Yet, a rosy future is no guarantee that any airline can weather financial storms.EOS Airlines has had to defend itself as well from similar claims but says that their January bookings are up. Unlike MAXjet, which cut fares in order to compete, Silverjet and EOS have maintained their fare structure. Perhaps MAXjet was playing with fire when they went toe to toe with American Airlines?

What You Can Do

If you are still interested in a career as a flight attendant, then jumping into the industry with your eyes wide-open is probably the best approach to take. Specifically:Read as much about your potential employer as possible. Join flight attendant forums and ask a lot of questions; try to connect with flight crew from the air carrier that interests you and ask them for their scoop. Chances are if there are problems with an air carrier, they’ll know about it and share what they know.

Keep your expectations low. New air carriers start up, new air carriers fail. If you are imagining yourself working for the same air carrier for 5, 10 years down the road, you could be setting yourself up for a big disappointment. Consider long periods of unemployment between jobs as a strong possibility — that car or house note which you can handle while you are working could be a problem for you down the line!

Consider other airlines. I don’t list every airline on this site simply because there are some who don’t pay that well and others whose futures are spotty. If job security is important to you, then working for an established air carrier could be the way to go. You just won’t have much of a salary to speak of, but you may be able to make some of that up by taking on some extra flights.

Buyer Beware

As with any job, it is up to you — the job candidate — to do your research. Things aren’t always what they seem when starting out, leading to disappointment later on. If you are the type of person who can go with the flow, then you’ll manage change effectively. If not, then a career with the airlines just may not be right for you.