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July 23, 2009

Jet America Flops Before It Opens


by Barbara S. Peterson

Father of deregulation Alfred Kahn, the Cornell economist, once quipped that "maybe it's sex appeal, but there's something about airlines that drives investors crazy." A perfect example of this syndrome--minus, perhaps, the sex appeal--came this week as the latest low-fare wannabe, JetAmerica, confirmed the obvious: It wasn't getting off the ground anytime soon.

JetAmerica, if you recall, was offering a new twist on an old marketing gimmick. The airline, which was to serve Midwest cities like Lansing, Michigan, from Newark Airport, promised to practically give away a handful of seats on its flights at fares from $10 to $20. (Remind anyone of Skybus? That was another short-lived airline founded by the same entrepreneur, John Weikle.) Its Web site promises refunds on the roughly 25,000 tickets it had sold.

As Department of Transportation spokesman Bill Mosley explained, the airline was technically a public charter, meaning it didn't operate any planes itself but instead planned to contract for the flights with a "real" airline--and under the DOT's rules, monies collected by a charter firm must be held in escrow. The DOT said it hadn't had any complaints yet from customers who'd bought tickets.

The fiasco calls to mind other ambitious airline deals that have stayed stuck on the tarmac. Of course it's no mystery why--it's the economy, stupid--but it all makes you wonder why anyone in his right mind would go near anything with wings.

Read after the jump for a list of other recent flops.

* Pogo on-demand air taxis: This one had a very prominent backer, former American Airlines CEO Bob Crandall, and Don Burr of People Express fame was involved. The idea was to offer no-hassle service out of small airports on new jet aircraft, but not long ago it was grounded when investors pulled the plug.

* DayJet: Another great idea using the new generation of light jet aircraft to avoid big congested airports, but it fell victim to the same fate as Pogo.

* Baltia Air Lines: A nascent airline that has been in the works for years, promising nonstop flights out of JFK Airport to St. Petersburg and other cities in Russia and Eastern Europe. The airline announced a few months ago that it had been cleared to start up this summer, but it has been silent since.
* And then there's Clear, the moribund registered traveler program that had promised to move us through security more swiftly.

Given that 2009 is a only a little more than half over, there are surely more to come.

Further reading:
* JetAmerica is the New Air Azul is the New Skybus? (Jaunted)
* Waiting for the All Clear (CNT/Aug. 2008)
* More on Clear, the registered travel program gone missing
* So Far, a Bad Year for Air Accidents
* On the Fly: Barbara Peterson on the airline industry


Can't we please retire the inappropriate word "tarmac" to specify the place where modern mega-ton air-transport aircraft park? There hasn't been a tarred MacAdam surface (named after the 19th century Scots road engineer, as I remember) in a century, except for the odd lightplane airstrip. A 767 or Airbus A330 would sink through a true tarmac like an ice-road trucker in April.

It's not "tarmac," it's a couple feet of concrete on a thoroughly compacted bed. Call it a hardstand, like the RAF does, if you insist on a Brit-ism...

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