Skybust: Skybus ceases operations

Posted by admin on April 5, 2008
photo by OZinOH

Skybus, the Columbus, Ohio-based no-frills carrier that famously started flying last May with $10 fares, announced on Friday that it will stop flying on Saturday, April 5. It becomes the fourth US carrier in less than a week to shut down (joining Aloha, Champion Air, and ATA). The news only broke late on Friday night, surprising both customers and employees.

“Skybus struggled to overcome the combination of rising jet fuel costs and a slowing economic environment,” the airline said in a statement. “These two issues proved to be insurmountable for a new carrier. We deeply regret the impact this decision will have on our employees and their families, customers, vendors, suppliers, airport officials and others in the cities in which we have operated. Our financial condition is such that our Board of Directors felt it had no choice but to cease operations.”

Why did Skybus fail? It’s a question that will probably be debated for some time to come. Obviously, fuel costs and the state of the US economy are two major factors, but they’ve impacted every airline, not just Skybus. Here are a few Skybus-specific thoughts:

  • Skybus did fly from secondary cities that, in many cases, were too far from the “major” cities that they were trying to market to. For example, what was listed as Hartford, CT on their website was really Chicopee, MA. In some cases, this was OK, but because there aren’t many ground transportation options between these city pairs that Skybus chose, it was sometimes difficult and expensive to get to their destination city.
  • Skybus also flew cross-country routes with a rather small fleet of Airbus A319s (it had only 12 planes at the time of shutdown), which meant that its airplanes weren’t flying as many hours a day as they could have. Skybus’ small fleet also left it vulnerable to losing money on under performing routes.
  • Skybus didn’t offer the option for connecting flights, meaning that they really limited themselves to those who were just flying between two cities that the airline served directly.
  • Rapid growth. While this isn’t necessarily a bad thing, Skybus did expand too quickly. It often would start out a new route and soon abandon it if it didn’t make money, and while this can work, Skybus’ small fleet meant that a significant proportion of its airplanes were on money-losing routes.
  • Little customer service, in my opinion. Skybus didn’t even have a toll-free number for passengers to call if something went wrong with their travel plans. And although the airline tried to get passengers to purchase food and drinks on board the plane (none were provided for free), its attempts to get passengers to dispose of the food and drink they already had always seemed unusual.

Regardless of the reasons, the failure of Skybus (and the other airlines that have closed in the past week) are indicative of the tough times that the US airline industry faces – we’re likely to see more tough times ahead and, sadly, more airline shutdowns, in the coming months.

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