America’s newest airline enters competitive airspace

America’s newest airline, PEOPLExpress, enters competitive airspace with plans to offer its first flights by the end of the month.

Despite the airline being the most recent to enter the market, the airline actually revives the name of an old 1980s low cost airline that ceased operations in 1987 after being integrated into Continental Airlines.

PEOPLExpress plans to begin operations on 30 June 2014 from Newport News/Williamsburg International Airport. The airline was publicly launched during a press conference at the Newport News airport on 13 February 2012, though its organisation began in April 2011 when Michael Morisi, an official at the original People Express Airlines and chief operating officer for the revived company, began bringing together a group of people to start the company.

Services will begin with one round-trip flight daily to Pittsburgh and one to Boston, and two daily to Newark, New Jersey. Additional flights from the hub will be added through the summer: West Palm Beach, Florida (from July 15); Atlanta (from Aug. 1); and New Orleans and St Petersburg/Clearwater, Florida, (from Aug. 28.).


But will the new low cost launch be a success? Since 2008, numerous competitors have disappeared from the U.S. airline industry either through bankruptcy and liquidation or through mergers. Four carriers now have an 85% share of the U.S. air travel market. No new commercial airlines have formed since 2007 to restore the competitive balance – until now.

The most recent large-scale mainline airline to succeed in edging its way into the competitive domestic market was Virgin America, which began service in 2007.

Here are some questions about the launch:

  • Can PEOPLExpress find enough other routes to/from Newport News with enough potential traffic to support multiple 737 daily flights?
  • Will PEOPLExpress survive the inevitable competitive responses? Will the giants stomp on new entrant competitors by slashing fares?
  • Some original publicity suggests that PEOPLExpress plans a hub-and-spoke system featuring connecting flights. Will that model work at Newport News?
  • Will PEOPLExpress manage to stay afloat without the local support that helped get it started?

The buzz around the launch of the airline and its potential success is skeptical. What do you think?

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[Picture: Andrew Thomas on flickr]

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