Summer Airline Predictions

Image: Michael Ochs Archives

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Thirty years of plopping myself down in seat 2B has made me older, balder, and fatter, but I have gained a lot of perspective too. So take it from this weary, wizened road warrior: Despite all the announced service cutbacks, commercial air travel is merely changing. The sky isn't falling and "the system" itself isn't collapsing.

This period of oil-fired chaos actually looks a lot like the travel landscape after Iraq invaded Kuwait in 1990. Then as now, airlines weren't ready for the oil shock and they panicked, shedding routes, grounding aircraft, and slashing in-flight service. Then as now, business-travel demand pancaked, companies kept their people chained to their desks, and travel and entertainment expenditures plummeted.

I don't know exactly what's going to happen next. But past is prologue in the air-travel world, and I'm willing to make a few educated guesses about what we'll soon see.

Subsidized Air Travel
The nation's top travel destinations, Las Vegas and Orlando, depend on a high volume of relatively low-priced flights to keep the tourists and conventioneers coming. But both cities take a hit whenever the airlines cut back. This time around, US Airways is slicing its Vegas hub in half, and Delta Air Lines is dropping service to Orlando from more than a dozen cities.

The solution? Casino resorts and tourist attractions may subsidize airlines to keep flying passengers into town. Or they'll help fund startups whose sole mission is to fly into Las Vegas or Orlando. In the late 1990s, for instance, several Las Vegas casinos helped launch National Airlines. It flew for a few years, until the other carriers beefed up their Sin City service. And Disney has frequently toyed with the idea of launching its own airline or going into a branded partnership with an existing carrier. Don't be shocked if you see Air Disney shuttling fliers into Orlando in the years to come.

New Airlines With Old Names
The established airlines are shedding planes by the dozen, and some of the aircraft may be serviceable for fledgling carriers with lower costs. Surprising as it may seem, startup funding may be available too. "There's always a hotshot with a business plan and an investment banker who thinks he's smarter than the room," explains one investor I know who's made some money funding airline startups over the years.

One quick way to get attention for a new airline with no track record: Use a familiar name. Over the years, there have been three airlines named Braniff, three named National, and two called Midway. I've lost track of the number of times the Pan Am and Eastern names have been revived. Even blip-on-the-radar airlines sometimes have valuable brand names. Silverjet, which folded in May after just 16 months in the air, is attracting potential rescuers.

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