LYCOS RETRIEVER 
Independence Air: Airlines
built 514 days ago
[One] one bits the dust: Washington Dulles-based econo-airline Independence Air will cease operations on Thursday, January 5. The company is seeking bankruptcy protection, but it sounds more like the "save us from our creditors" flavor rather than any attempt to salvage the airline itself. Those with Independence Air tickets through Thursday "should expect the same great service for which we have become known," according to a letter to customers. No doubt. Those with reservations after Thursday will get a refund, supposedly as soon as the bankruptcy court approves same. Those customers with flights departing before the end, but with return flights scheduled afterward, may find themselves in a gray zone of oblivion unless they reschedule an early pre-closing return.
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All over the news yesterday -- Independence Air sent furlough notices to all its employees, warning them that they might not have a job as of January 7 unless the airline gets a "significant investment" by that time. Guess Independence is no longer pretending.
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Independence Air is trying to save itself by launching more flights with its profitable A319 aircraft, and trying to dump some of the more unprofitable CRJ flights. The airline is launching new A319 service to New York La Guardia, while cutting CRJ flights to JFK, as well as Stewart up north. Furthermore, the airline is ... cutting some of the more unprofitable CRJ flights, to Louisville, Cleveland, and Indianapolis. The airline also plans on launching San Juan this winter. However, this might be too little too late, as the airline is still burning cash, and the A319 flights don't exactly fill the financial crevasse the airline has dug itself. However, the facts are that if the airline wants to last for a long time, they have to cut much, much more (if not all) of its CRJ flights, and focus on short-haul East Coast routes from D.C. This means that they must file Chapter 11, and soon, or else they may be stuck and quite liable to their creditors.
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Independence Air [I]s telling potential new customers that it will begin selling tickets sometime in May 2004, and its iCLUB members, hose registered on its site at www.flyi.com, will be emailed the exact date ahead of the rest of the world. The airline says it is driven to offer a product that is less expensive and easier to fly than most airlines, while giving them a straightforward fare structure with limited restrictions. Independence Air, which is now Atlantic Coast Airlines, will launch June 16 from Washington-Dulles Airport. By the end of the summer, it expects to be flying to 35 cities. Customers who sign up to the airline's iCLUB will receive $25 off their first roundtrip flight if it is booked by Sept. 30 and flown by Dec. 31 2004.
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Passenger traffic at Washington’s Dulles International Airport has dropped since Independence Air went out of business on Jan. 5. The number of fliers using the airport fell by 1.2 million through the first three months of 2006, an 18.7% drop when compared to the same period last year. “That almost surely reflects the loss of Independence Air,†writes The Washington Post (free registration), noting the carrier had a large hub at Dulles. But Dulles’ loss may have been a gain for other airlines and airports in the region. “With cheap tickets from Independence Air no longer available, some people who would have flown that airline may not have taken trips," the Post writes, adding that "others presumably flew on other airlines at Dulles or went to other airports.â€
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Independence Air today filed for Chapter 11 bankruptcy. This should come as no surprise to anybody watching the industry even remotely. Hopefully, Chapter 11 reorganization will lead to the company's demise. This airline has been around for too long with a business model that is fundamentally flawed. Furthermore, Independence Air is in a lousy market. They not only have high costs but are competing in a market with very low fares, due to the Southwest competition in Baltimore.
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