Hope, a wing ... and a prayer ...
The News & Record's Dick Barron quotes an industry analyst as saying the Skybus strategy remains a sound one.
The discount airline, on which PTI has pinned a lot of hopes, "has made smart choices, given current conditions, and its low-fare formula that offers direct flights with no frills is an idea that has worked around the world, Barron reports he was told by the analyst, Anthony Tangorra.
But Tangorra also tells Barron that Skybus can't continue to lose money at the current clip. "When it comes to walk-up fares and other buckets in the Skybus system, they need to generate higher yields to survive. Their yields are simply too low," he says.
Read the complete story here.
Some cynics are saying local leaders have been had for the incentives they provided the airline.
That they jumped too eagerly at an unproven startup.
But they made a calculated gamble that still appears worth making, even in hindsight. Skybus isn't the only airline feeling the pinch of high fuel prices; they all are.
Further, PTI desperately needed a low-fare carrier and Skybus fit the bill. If it survives the current turmoil in the industry, it will be well worth it for the airport and for Skybus.
Comments (10)
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Whatever the Skybus pullback says, it says nothing about incentives, either pro or con. The Skybus package was in the neighborhood of $2.15 million, in return for a $350 million capital investment and the creation of 375 jobs. And "in return" is a key phrase. It's not like PTI wrote Skybus a check for $2.15 million. Skybus has to verify that it's met various performance goals before it gets the funds. If it leaves PTI (and it hasn't left yet!), then it doesn't get 'em.
Posted on March 31, 2008 6:48 PM
Good point, Andy. It's interesting that the analyst also cites political connections, or the lack thereof, as another possible road block to Skybus's survival.
That would be a shame.
Posted on March 31, 2008 6:53 PM
PTI is a high cost small airport. People think growth is coming in the Triad area when in fact there is little to be found. One reason boardings are so low is the high cost of fares. Anything the Airport Authority does to work with lower cost airlines flows directly to the pockets of the users. Skybus may fail but I salute the Airport Authority for trying.
Posted on April 1, 2008 10:57 AM
I think they should experiment with gliders.
Posted on April 1, 2008 12:27 PM
I think they should experiment with gliders.
Posted on April 1, 2008 12:27 PM
If they do, I'll let you book a flight first. You can tell us all how things went.
Posted on April 1, 2008 1:38 PM
Once again, what is "International" about PTIA?
Inserting "International" into the name of this third-rate airport is reminiscent of Hillary's tale of ducking sniper fire in Bosnia or her misrepresentation of her role in the Norther Ireland peace talks.
It all reminds me of my housecat - she sometimes puffs herself up in a silly and foolish attempt to be bigger and badder than she actually is.
Posted on April 1, 2008 3:37 PM
Once again, what is "International" about PTIA?
I remember when this became the official name of our Regional Airport and-surprise surprise the cost of food and beverages shot up. I've been to our int. airport on Sunday evenings and its like a tomb.
Posted on April 2, 2008 10:49 PM
Well they got rid of their marketeer of operations and replaced him with the bean counter (accountant). Now their strategy will be to make certain all packs of chips are accounted for instead of addressing how to better market the airline in a depressed economy.
Yeah, they're going in the right direction.
Posted on April 3, 2008 2:29 PM
This is a huge blow for the airport. Three airlines have gone belly-up in the last two weeks.
PTI needs a low-cost carrier. Desperately. But it may take a while, given the state of the economy and fuel prices. The entire industry is hurting.
Posted on April 6, 2008 11:43 AM