Will Eastern Airlines be resurrected and fly again?

by Charlie Leocha on March 4, 2009

This doesn’t seem like an auspicious time to try and start, or re-start an airline, but a group of former Eastern Airlines employees and an investor group are exploring the rebirth of Eastern.

In a letter circulated to former Eastern Airlines employees, an investor group announced that they have “concluded a deal with the Eastern Airlines estate to acquire the name, trademarks and affiliate names (including Eastern Express and Eastern Shuttle) for the purpose of re-starting the airline as a scheduled airline.”

Ed Wegel, a veteran of the airline world and current CEO of Eastern Airlines, Inc., told former Eastern Airlines employees, “We have developed a business plan for the re-start of Eastern which leverages off of Eastern’s core strengths while using all of the lessons we have learned from all of the start up airlines and the restructuring of all of the legacy carriers over the past 18 years.”

According to this letter, the new airline management will break new ground with contracts with the new Eastern’s crew members and a stock ownership plan that will completely align everyone’s interest in the new company.

Wegel closed out his letter to former Eastern employees with a paean to the workers at Eastern.

One of Eastern’s greatest assets was its people, and we have formed an advisory group with volunteer representatives from marketing, sales, in-flight, facilities, maintenance, and ops. We want to retain the creativity, energy and vision that epitomized the Eastern that flew for over 70 years, and created the Shuttle, System One and countless other innovations.

Ed Wegel, certainly has the credentials and some of the investment-community connections that might make this resurrection a success: CEO, Eastern Airlines, Inc., April 2006 — Present; President, BWIA, 1994 — 1996); SVP, Atlantic Coast Airlines, 1991 — 1996; AVP, Shearson Lehman, 1987 — 1991; Manager, Pan American World Airways, 1985 — 1988; and Manager, Eastern Airlines 1985 — 1987.

The investment group plans to acquire 30 new Airbus aircraft and faces re-certification of Eastern with the FAA and DOT. Getting financing is certainly going to be tough in this current economic environment.

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  • EAL Brat

    Good luck on that one. Mr. Wegel may have significant industry experience, but he won’t bring back the EAL that we all knew and loved. Charlie, go and talk to some of the very few remaining pilots who meet at local cafeterias and restaurants every month and I think you’ll get a very different perspective of what Mr. Wegel is attempting. My dad retired in 1977 as Chief Pilot on the DC-9, and all I can think when I read about this is that he is turning over in his grave.

  • Frank

    I have fond memories, non-rev’ing on them to SJU multiple times. Down to Florida and out to SFO. Class act. They put their non-rev’s, and I think dead-heading crews in First Class.
    But, seriously, how many airlines have tried this in the past? We had Braniff, Pan Am, Laker…etc. In addition in consolidation, few national airlines. This is a concept of the past, as well.

  • Bill

    Running an airline under any name is difficult. Sure – Eastern is a nice name. I never flew them, but view it in a positive light. However, it isn’t just the name and logo, it is how things are run.

    I wish them luck with it, and I hope they don’t just go and waste a whole bunch of investors’ money.

  • Don

    Gosh – hope they’ll recognize my lifetime Ionosphere Club membership!

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  • Henry

    Um, does anyone remember the group called “We Hate Eastern Air Lines” (WHEAL)?

    Eastern, sadly, did not enjoy the best of reputations. There are many reasons for this, of course, but it is tough, almost disingenuous, to say that Eastern enjoyed a reputation for good customer service.

    Plus, take a look at the business news: Airlines are cutting capacity in response to falling demand. We don’t need new airlines or more capacity. We need the airlines we have to succeed – and it’s not guaranteed that all will.

    Plus, the market doesn’t appear to suffer from too many unmet needs. Most major cities have adequate service. We have an extraordinary degree of competition. JetBlue has essentially replaced Eastern (and, for that matter, the original National) between the Northeast US and Florida – with a nice product and attractive pricing, to boot. Delta and AirTran dominate Atlanta, EA’s former hub (ironically, AirTran even uses a former Eastern hangar at ATL). US Airways dominates Charlotte, a secondary EA hub. And American has about 65% of the share at Miami, Eastern’s former hometown.

    Sorry, this dog don’t hunt.

  • Gene Isom

    I’ve just finished reading all the above negative crap. They have the nohow, and If they have the financing and dertermination, they can make it.

  • Rick Johnston

    I would applaud an attempt at a restart of the airline. As an Eastern brat, Dad worked for the airline for 34 years, I have many fond memories of Eastern. Yes I remember WHEAL and I also remember the 20% pay cuts Dad took to give pilots and ramp service raises only to see the airline ultimate destroyed by Lorenzo. But Eastern did have a good reputation through much of its 70 years life and many employees like my Dad loved working for Eastern.

    I hope that the investor group and these former Eastern employees are successful. I would love to see the Eastern colors fly again. But lets face the reality, in this economic situation and extremely difficult competitive airlines industry, I think it will be an uphill climb to say the least.

    Good Luck to all.
    RJ

  • James M. “CRASH” Craddock

    Eastern was One of the greatest and most inovative carriers that ever flew.
    We had the greatest group of people ever assembled.
    if they get the same dedication and determination from this new group of folks they can succeed in this venture.
    I worked for Braniff, Midway, Flying tigers, and Fed-Ex. military ops as well as twenty-five great years at Eastern, and retired after 13 years at delta and I would go back to work today if EAL called me.
    Jim Craddock

  • Patti Flynn Bopf

    I worked for Eastern Airlines for 17 years up to the demise. I started in reservations in Woodbridge, New Jersey, then transferred to Chicago Res. I moved back to New Jersey, then transferred to Philadelphia Airport and then Bradley Airport, Connecticut. I ending my career with Eastern in Philadelphia Airport. In all of those years wherever I went and people asked me who I worked for I was never ashamed to say EASTERN AIRLINES. Back then we where in the
    Service Industry not the DISSERVICE Industry! We where loved by all of the other
    airlines pilots and flight attendents, so I guess we couldn’t of been that bad?
    I have always said that I would love to retire working again for a great airline,
    so Mr. Ed Wegel, please WELCOME ME ABOARD!

    Good Luck EAL,

    Patti Flynn Bopf

  • Patti Flynn Bopf

    I worked for Eastern Airlines for 17years up to their demise. I started in reservations in Woodbridge, New Jersey. I moved back to New Jersey, then transferred to Philadelphia Airport, and Bradley Airport, in Connecticut. I ended
    my career with Eastern back in Philadelphia Airport.

    In all of those years wherever I went and people asked me who I worked for I
    was never ashamed to say EASTERN AIRLINES. Back then we where in the
    SERVICE INDUSTRY not the DISERVICE INDUSTRY! We where loved by all
    of the other airlines pilots and flight attendents, so I guess we couldn’t of been that bad?

    I have always said that I would love to retire working again for a great airline,
    so Mr. Ed Wegel, please WELCOME ME ABOARD!

    Good Luck EAL,

    Patti Flynn Bopf

  • Don Murphy

    I worked for Eastern for 27 years and had the time of my life. Met and worked with some of the greatest people anyone could want to work with. I loved everyday I worked, and like Jim Craddock would go back if they called me.
    the timing may be a little bad but I can only hope and pray Eastern will fly again. As far as WHEAL is concerned lets hope it went to American where it belongs.

    Don Murphy STL

  • J. Guillermo Zepeda López

    I worked for Eastern Airlines for 13years up to their demise. I started in Line Maintenance in Mexico City Airport, Eastern was One of the greatest and most inovative carriers that ever fworked with.
    We had the greatest group of people ever assembled in Mexico,central and south America.
    If they get the same dedication and determination from this new group of people they can succeed in this venture.
    I have been working for the new Braniff, Continental Airlines as well as 13 great years at Eastern, and at this moment Im working for a cargo airline as director of maintenance and I would go back to work today if EAL called me.
    I want to be on board………I´m reday

  • jj carter

    Eastern Airlines lives on in the hearts of many. I still have my wings and will put them to use if called upon. This is fantastic news!

  • David Ruiz

    I don’t remember If ever flew on Eastern, but I will say this, that it wont be easy to start up an any airline the way the economy is on this present day? Although it wouldn’t hurt to try if you have a great strategy & cash flow needed to keep it running the way it should. Also to mention that it will also create jobs for those unfortunate that don’t have a one. I think that by bringing EAL back to life some things are better that they remain the same from The Company’s Logo’s & Color Scheme to the Dedication & Service provided through out the years while it was still alive. Not only was it well known, but it touched lots of peoples hearts through out the world and I’m one for bringing this GREAT ICON BACK TO LIFE!

  • Karl Lonieski

    I also was a former Eastern manager in NY…had 20 years…I have since worked for Northwest and United and I must say, that in it’s day, Eastern was very advanced in many ways, particularly is reservations system and automated checkin…They were years ahead of the rest. I do a lot of flying, but no one can beat Eastern for the service. It was truly a professional company and I would ABSOLUTELY consider working for the new Eastern!!
    I wish you all the best, Ed!!

  • http://seat5f.wordpress.com Chad

    My dad was with Eastern over twenty years, and he was part of the team that turned the lights out on Eastern’s Atlanta hub in 1991. Eastern was a great airline in its time, and I really do wish this group all the best. I just hope they’ll wait for the right timing and investors so that Eastern really does have a fair shot at flying again!

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  • Wes Burkhart

    GOOD LUCK!!!!! Thats the best news i’ve heard in a long time, EASTERN can come back better and stronger then before, the people is what made the airline, in todays maket there is no good service . at EASTERN they had great SERVICE jjust remember in the 70 there was a HoJo on ever conner were are they today. I belive in EASTERN

  • G L Bennett, Esq.

    BRAVO Eastern Air Lines- then and now…. In all of my 35 years of airline experience, I have never met anyone who had any unkind memories of the EAL family. Yes there were some not so pleasant events during its’ history, but generally speaking, it was an incredible corporate icon to have enjoyed.
    Just think of the ad campaigns with the unforgettable voiceovers by the Orson Welles: Eastern- Number One to the Sun!
    Eastern, the Official Airline to Walt DisneyWorld!
    Eastern Air Lines’ President- the one and only (Moon Man) Colonel Frank Borman. Even as far back as the Mail Wing, our nation’s first airline, Eastern was a trailblazer and trendsetter: The first Air Shuttle with the non-stop flights to/ from Washington DC and Boston from New York’s LGA LaGuardia airport (an extra section was always available, whether you were the only extra passenger or in a group of passengers for the last flight!) And then there was System One- the computer system second in capability only to that of the Pentagon!
    Yes, Eastern Air Lines, with it patented/trademarked colours: Ionosphere and Caribbean blue… would be awesome to see and hear again in the wild blue skies so elegantly described in the poem High Flight.
    Hurry up 2010. And like before, I’d pay to work there, only this time it would not be so scarry- Mr. Lorenzo can never, ever have another airline charter!!!

  • GERARDO LOPEZ

    Hello I am a pilot for Spirit Airlines, I am on furlough right now. I became a pilot so I could fly for Eastern Airlines and the wonderful Tristar L-1011. After EAL closed I was going home and landed in Atlanta for a stop over. As I passed by the EAL terminal and saw all those airplanes park with the gateways not connected it broke my heart. I was finally a commercial pilot ready to apply to EAL. All I can say is that EAL was a pioneer in her time and it could be again, even though people look for low fares they are tired of the lousy of the service they provide. From the bottom of my heart I wish EAL the best of luck I would love to see them in the air again. I you need pilots I will love to fly for you. Take care and best of luck.

  • http://www.tripso.com Charles Maynard

    The customer service issues really didn’t start until the mid-80s. Prior to that, EAL was considered one of the greatest airlines flying. Pilots coming out of the military really wanted to work for either Eastern or Pan Am. Sad to see both of them perish.

  • Tim Campione

    I was in the ATL RR reservations center until it closed in Jan 1991.
    I worked with some great personalities and learned a great deal from them.
    I would work for Eastern Airlines again, and again.

  • Gerald Bergan

    My father was an Eastern mechanic for more than 20 years until they went under and we both mourned its demise. I know that if he were alive today he would love to hear of plans to restart the company. I echo the concerns of others that Mr. Wegel wait until the right moment. I only hope he has the foresight to know when that moment is, for I don’t.

  • http://www.tripso.com/today/will-eastern-airlines-be-resurrected-and-fly-again/ Francis Gilman

    I was a former EAL Shift manager in Miami’s Engine shop for 17 years. It would be a dream come true, if this new team can pull it of to revive the old spirit. I belive in EASTERN AIRLINES and I am ready.

  • DAVID QUINTANA

    I REMEMBER EASTERN AIR LINES WITH FUND MEMORIES. I FLEW THEM MANY TIMES TO PUERTO RICO WHEN I WAS A YOUNG KID AND AS AN ADULT. I FLEW FOR ATA AS A FLIGHT ATTENTANT AND WHEN EASTERN CLOSED IT’S DOORS MANY F/A CAME OVER FROM EASTERN. WONDERFUL LADIES AND GENT’S/ NOW I FLY FOR UNITED AND I REALLY ENJOY WORKING WITH FORMER EASTERN F/A’S..

    I WISH YOU THE BEST OF LUCK!!!!!!!SPREAD YOUR WINGS AND FLY….

  • DAVID QUINTANA

    I REMEMBER EASTERN AIR LINES WITH FONDNESS. I FLEW THEM MANY TIMES TO PUERTO RICO. I ALOS FLEW FOR ATA, AND WHEN ESTERN CLOSED IT’S DOORS MANY EASTERN F/A’S CAME OVER TO WORK WITH US A ATA..I REALLY ENJOYED WORKING WITH SUCH FINE F/A’S.

    NOW I FLY FOR UNITED AND I REALLY ENJOY FLYING WITH EX EASTERN F/A’S.
    I WISH YOU THE VERY BEST!!!!!!

    SPREAD YOUR WINGS AND FLY!!!!!!!!

  • Fred H Jackson

    I retired in 1991 as a capt on the DC9, Some of the best years of my life were at Eastern, i would vulinteer in a hot minute if asked to lend a hand , even at age 76. We had a great airline and wonderful people to work with , I sure hope it is a go Fred

  • BILL MURRAY

    worked for eal for 20 years 12 years at the lga shuttle but had to leave because the writing was on the wall. spent 20 years with USPS and am now retired.
    BUT IF EAL WAS TO START UP AGAIN I WOULD COME OUT OF RETIREMENT TO HELP THEM

  • thomas

    my step dad started with eastern back in the 1940′s and retierd mid 1970′s .
    i am sure he would have been happy to see the airline name flying again, he passed away year 2001.

  • Leonora Xhrouet

    I was a Flight Attendant from 1973 until the strike and never went back. I never received any information about the resurrection of EAL from anyone! I would love
    EAL to come back and be successful. I am now with AA as a F/A and we were certainly a class act. No other airline can compare with EAL.

  • http://none Gary Rompot

    I am an EAL brat, my DAD and my Brother,TOM Rompot both retired from THE WINGS OF MAN. THE GREAT SILVER FLEET. I would LOVE to work with the new EAL . I can pay the company 1.00 dollar per day for my day at work. BEST OF LUCK . PLEASE call me if you need me .

  • Tony

    As a former TWA employee, I remember I was trying to get home to LGA
    from PBI. My airline was full, but Eastern had room. Not only did they put me on, but they put me in First, and sat me next to Mr. Douglas Fairbanks Jr. I still remember as a kid growing up, how excited I got everytime I saw their
    727 Whisperjets, or their L1011 Whisperliners. Eastern was a class act,
    and just like TWA, its demise was a direct result of the greed of one man.

  • dennis

    Now that was an airline………I worked with Eastern for 9 years and saw the demise coming so i left with my retirement and 401k. Lorenzo swindled those poor employees that stayed……….and took their retirement money as well.
    Anway, it was a pleasure and a joy to come to work everyday. And that’s why we were the best in the business at that time. I would come out of retirement if they ressurect Eastern.

  • http://AOL Daryl Bernys

    I’ve loved Eastern ever since my first flight at 3 yrs old on an L-1011. I feel that when Eastern airlines returns to the skies, it will shead glory through eveyone’s eye’s that has been waiting for this moment since Jan 18. I also feel that Mr. ED Wegel is Eastern Airlines angel , just waiting in the wings to bring back the greatest airline period. What airline can come close, when Eastern was the only airline ever, to bring up another plane and crew just for one passenger. The shuttle is and was an unpresidented innovation created by Eastern. It’s really bad and sad that 1 idiotic moron would be able to do what that guy did to the best airline in the skies. Eastern Airlines should be the biggest airline out there, not Delta. Just because they reaped the benefits of Eastern demise by gaining more market share, still doesn’t make them have the airline Eastern was. That’s why so many of us are awaiting the New Eastern to take to the air. Mr. Edward Wegel I personally hope you revive this once great proud airline, and with the investors help, bring them back and help them become the airline they once were, by being once again The Wings Of Man and also the number 1 airline out there. This is one quest I would never give up on , never say die, I hope Eastern comes back better than ever!!!!!! PS, Everone want’s to see the hockey stick livery in the air again. Thank you Mr. ED. Wegel for all that your doing to bring back the greatest airline ever.!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

  • Joseph

    This comes as great news to me. But where does another carrier come into play during these economical times when people aren’t flying? Perhaps EAL should first consider taking a new kind of approach to the airline industry. All the major domestic US carriers tend to heavily compete with each other, while some form an alliance when separate airlines share common investors. In today’s market, it might be wise to start off working in tandem with other airlines, not to get too large too quickly as to build strong enough assets to be self sustainable rather than over-extending too quickly and wasting everyones money, cutting jobs. Before we promise 10,000 jobs… start out with 2500 and work up slowly. By “working in tandem with other airlines” I will give some examples. If EAL were to retur to JFK, all the compitetion from mainly JetBlue “my favorite existing airline currently operating at JFK as a new yorker” and many other carriers like Delta American. Instead of wildly promoting the same destinations, you have all that competition in price, service, conveinence in timetable (what time your plane leaves or arrives). In other words, EAL should start out with a solid amount of aircraft, only operateing them to their max during peak travel times when they will be gaurenteed filled seats. This will also be helpful to other airlines operating at the same facilities. They don’t need extra aircraft to handle the extra traffic, they know EAL will handle their overload during these times, allowing the costs to drop, making EAL and cooperating airlines the hottest ticket during these times. I think it could be done, but only if conservitavely. If any new airline wants to be born and survive it has to stay out of the other carriers’ way. And it would have to be a venture motivated by great innovators. And thats what EAL stands for! Innovation! The names still sounds as big as it looked written on the feuselage of a Tristar~L~1011. EAL can use this to their atvantage when starting out small. Keep the same coulers and hockeystick logo. The stripes the same, top stripe covering the window line, not the “thin stripe” but maybe use a variety of main body color schemes, like black, either of the blues, violet, or the old metal, white, or grey. I know you can’t promise me a job, but i hope to at least be a passenger on EAL soon! Good luck, hope to fly soon.

  • Dean D.

    What a fantastic thing it would be to see Eastern Airlines fly again, but I am reading some very disturbing things on this site. Yes, Lorenzo was a hard man but it takes two to tango and Charlie Bryan (the IAM local president) was a short sighted meglo-maniac that didn’t care about anyone but himself and his own greed. I know… I worked for the jerk. BRING BACK EASTERN… but not Charlie Bryan.

  • http://www.rescuewireless.com Michael Olivera, Jr

    In 1989 when Eastern Airlines Went down bankrupt I suffered loosing my Miami-Lima-Miami tickets. In addition, I was just coming out of Army basic trainig and AIT in Fort Sill Oklahoma. I lost my tickets and my money and back then as a PFC (small salary) While at MIA I contacted a toll free # listed in my military orders. I was broke so the Army throuh the Red Cross booked me a hotel room with breakfast near the airport and the next morning I took a MAC C 130 (Next time I took a military flight was deploying to Iraq) to Charleston. If you are an Eastern Executive reading this? Please lend me a hand to get my tickets back (if you are re-opening contact the e-mail attached to this post, thanks!)

  • larry

    Dean D is right. The fact is that Lorenzo saw early on that the airline industry was being Walmarted. He bought a bunch of airlines that were headed for the graveyard and tried to shed costs in order to keep them flying. The only one of the bunch that did not survive , which included Eastern, Continental, New York Air, Frontier, and People Express, was Eastern. That was thanks in large part to Bryan and the strike. All the others are now folded into Continental. Nice to see the old Eastern folks are still in La La Land. Here’s an idea. Why not name it KIWI….

  • Dennis Sosler

    I came on board EAL in June 1978 and remained until it’s demise in March 1989.

    I have many fond memories of those days and the dedicated employees that served the company. Unfortunately, bad decisions were made and an unscrupulous individual decided to literally run the company into the ground, putting thousands of employees out on the street.

    Deregulation was the beginning of the end for many long-time established carriers that couldn’t compete with the “no frills” airlines that appeared.

    Those carriers lowered their standards and just hired bodies, not dedicated, professional employees. In order to compete dollar for dollar compromises were made to the detriment of the airline.

    I left the airline industry but have many former co-workers that went to other major carriers: i.e. American, United, Delta, etc. They said that the complecion of the entire industry has changed dramatically. It’s unfortunate to travel by air today and witness the scaled down version of what used to be a luxurious mode of air travel.

    However, like many former employees, I too would welcome the opportunity to experience a reborn EAL, if only for the nostalgia.

  • T. Tuite

    I am hearing of a plan to possibly buy up to a 50% share of USA3000 airlines. USA3000 Airlines is owned by Apple Vacations and flies Airbus 320′s.

  • len

    ding ding ding….we have a winner! This is going to be a certificate swap involving USA3000, Apple, EAL, and a portion of loads coming from Apple.

  • George F Schlager II

    My father worked for Eastern from 1956 till the end when he was forced into retirement. He was based in Miami , FL as a lead mechanic. Eastern’s pride was their fleet and their people. I don’t know how my father would feel if he were still alive with the posibility of their resurrection but I would welcome a reborn Eastern with their logo’s and such if just for nostalgia sake! Good luck!

  • James Moore

    I started working as a radio mechanic for Eastern in MIA back in July 1967, in phase check. I Then transferred to the radio shop, and worked in the test equipment certification dept. In 1975, I transferred to SJU, and worked in the Auto shop, Later transferred to the newly opened Ground Communications shop. Was there until Lorenzo started tearing the company apart and had to go back to the Auto shop until the strike in 1989. At age 55, I was too qualified to work for American, Delta, etc. So I started my own business as JDM Electronic Service worked for myself, did contract work for American Eagle, and worked in the marinas. Now at age 70, I just work at home, but really miss my EAL. Mr. Ed Wegel, wish you luck, and hope you do great.

  • http://tripso.com Brian

    My first airline job was working for Eastern Airlines in PHX and then MIA. Some great people and wonderful memories. 25 years later, I’m still in the airline business working for a major carrier in sales and marketing. I worked for Frank Lorenzo at EAL and then CAL, he was a ruthless bean counter. He robbed EAL just like Carl Ichan did to TWA. Deregulation of the airline industry in 1977 by Jimmy Carter began the eventual demise of the airline industry. Since then, 150 airline companies have come and gone. I was in Roswell, NM last week touring the 280 aircraft parked in the desert, some were old Pan Am and Eastern 727′s / L1011′s now rotting away along-side newer more modern aircraft. Idled due to the economy, higher fuel costs, LCC growth, and allowing repeated bankruptcies by several legacy carriers who didn’t have to pay their bills and wiped out billions in debit while forcing other carriers to slash costs to compete with them. The only thing deregulation did was allow airlines to compete based on price. The rest of the business today remains heavily regulated and pays more in taxes than even sin taxes. The only way this industry will ever become sustainable and profitable is: Re-regulate the fares or set a minimum seat mile cost (CASM) that everyone must charge (a full plane does not mean you are making money). Productivity, you can pay your people well if they work enough reasonable hours. Hire and retain good people, not just MBA’s with no hands on experience, with theories and spreadsheets. I would love to see the EAL colors flying again, but I’m afraid unless the new senior management team being assembled by the investors doesn’t know this already, EAL may become # 151 which would be a terrible fate for such a proud airline with so much potential. If President Obama wants to stimulate the economy, perhaps some legislation to abolish de-regulation and set some standards and benchmarks for all carriers to follow on fares, tax relief, and stop repeated bankruptcy filings. I believe the result would be increased profitability, and more competition based on service standards.

  • larry

    Brain, since Walmart has put far more businesses out of business than Jimmy Carter ever did with the deregulation of the airline business, then I guess you think it’s ok to regulate Walmart pricing on food and stuff also. That ought to make the folks at Kroger, Safeway, Supervalu, and tons of mom and pop stores very happy. While were are at it, why don’t we just regulate the price of everything and become another socialist country. You’re kidding right? I find it interesting that a lot of airline folks long for reregulation of their industry, but really would not like to see it happen to other industries, being that many of them, especially the pilots, are generally cheap folks when it comes to buying stuff.

  • http://tripso.com Brian

    Larry,

    I don’t shop or support Wal mart, so I’m not subject matter expert on them. But I do know the airline business better than most do, both below and above the wing.

    My point is that the current model of deregulation is not and has not worked. The only thing de-regulated about the airline business today are the fares. The rest of the airline business is still heavily regulated, so my point is, either completely de-regulate it or re-regulate it.

    To have to compete with a bunch of bankrupt carriers for years that don’t have to pay all their debits, break labor contracts, impose pay cuts, all on the backs of their employees is not a recipe for success. Not when I don’t get the same benefits or cost breaks as a bankrupt competitor does. Does that sound like healthy capitalism?

    All this pain so some business man can buy a cheap ticket and demand an upgrade to first class. The airline business is all about cash flow, and low margins these days. Our best year ever, we generated a 1.7% margin, when most Fortune 500 firms today generate 10% to 15% margins annually year after year? No wonder 150 airlines have gone under since deregulation.

    Deregulation has turned the airline business today into Wal mart. Anyone with a lot of capital and financing can start or buy an airline and run it for a few years on new planes, airport tax-payer subsidies, and cheap labor. I’ve seen it done many times before. Eventually it catches up to you. This is not a sustainable business model. With age of your fleet come heavy maintenance costs, more expensive labor and higher network costs, Southwest is clearly heading down that road with diminished profits and lack luster financial performance.

    My parents taught me, ‘You get what you pay for’ and that is the case whether it be Wal mart or a high end retail store. I have every right to charge enough to cover my costs and make a profit like any other business. But when you have to keep lowering your costs to compete with the Wal mart airlines of the industry today, you can only do it for so long before you go out of business or file bankruptcy like your stupidest competitor did. Some folks just need to take the bus or drive if they want cheap transportation in my opinion.

    Perhaps we should de-regulate the health care system too? The last I checked, medicare still pays doctors a set fee, and brain surgery and heart transplants are still pretty expensive. Maybe they should have to match the costs of medical care in Mexico? And not depend on Government tax subsidies to help off-set the costs of all the illegal immigrants and welfare patients and prisoners who pay nothing? If the feds didn’t subsidize and regulate them, every hospital in this country would be bankrupt and out of business as well, just like the airlines are today.

    I”m no rocket scientist, but I do think less government and more competition is a good thing. We just need to all be on a level playing field. And that is not the case in today’s airline industry or since deregulation.

  • larry

    Brian, You did not say in your first post to either deregulate or regulate it. Only the latter. If you are really for the complete deregulation of the airline industry, then we agree. As for the 10 to 15% annual profit margins of fortune 500 companies, although that sounds kinda high, I do know the supermarket business, one that has to compete with a ruthless competitor (Walmart) and most would kill for the 1.7% that your business had one year. Also, no business has a “right” to make a profit. They are certainly free to try. The high taxes you alluded to if your first post are borne by the customers, not the airlines. Same as in any other business. As for medical care, I’m all for your suggestion. That we can agree on. I also agree with you about the misuse of bankruptcy laws by some airlines. Those should just be allowed to die, just as some companies in the auto industry today.

  • Andrew

    I’ll second the USA 3000 thing. The rumor around there is that the Apple group would sell 51% of the interest in U3K to Mr Wegel and his group and that Apple would provide 20-30% of the bookings to the airline. A win-win for both parties and significantly improves the chances of success and the ability to withstand anything American might throw at them. If Apple chooses to send their passengers on “New Eastern”, there isn’t much American can do to prevent that. Hopefully since there is pretty strong wording in the pilots contract regarding transfer of the certificate, it would mean all of the U3K pilots would go to the new airline.

  • Rick L

    My father retired from Eastern after 25 years of service and I worked there as a mechanic for 13 years beore Lorenzo took us down. If by some miracle, Eastern could be resurrected, I would be proud to come back and work for them.

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