More low cost competition for US Airways in NC

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Jul 23, 2004
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As GSO nears completion of it's new 10,000 duel runway, it begins a push for hub service.

REPORT OF INCENTIVES
Regions putting Skybus on radar
Thursday, October 18, 2007 3:45 AM
THE COLUMBUS DISPATCH

As Skybus Airlines released its latest batch of tickets and cut several West Coast routes, other cities continued to compete for service from the low-cost carrier. The Winston-Salem Journal reported yesterday that more groups are offering Skybus incentives to make Greensboro, N.C., its next "focus city," while The Bahama Journal said Skybus is expected to start flying to Freeport by March.

Skybus spokesman Bob Tenenbaum would not confirm either report.

Skybus has said it's considering Greensboro, and other cities, for an additional base. It also has filed for federal permission to fly to the Bahamas. Tenenbaum said there's no timetable for announcements on either matter.

The Bahamian newspaper quoted David Johnson, director general of tourism, saying that he expects a deal in November. He said once-daily service should begin in March, with daily service expected from two new Skybus "focus cities" by fall 2008.

In Greensboro yesterday, the board of the Piedmont Triad International Airport adopted a formal incentive policy. The incentives could benefit Skybus, although Executive Director Ted Johnson emphasized that it is available to "all airlines."

According to the Winston-Salem newspaper, Greensboro is competing with another current Skybus destination, Richmond, Va., to be the airline's next base. The Greensboro-area Forsyth County Tourism Authority announced a $100,000 incentive package after receiving a letter from a Winston-Salem development organization saying that Richmond is offering Skybus $50 million in local and state incentives. That rivals the $57 million incentive package Skybus received to base its operations and headquarters in Columbus.

Troy Bell, spokesman for Richmond International Airport, said he was not aware of the $50 million amount, which would have to come almost entirely from sources outside the airport and would dwarf any past incentives to draw an airline there.

"We try to fill in gaps in our service. If Skybus decides to bring more flights here, we would certainly welcome it."

The parent company of The Dispatch owns a minority stake in Skybus.
 
CAL lite died in GSO and Skybus is bleeding, doubt it will be a success at GSO.
 
I wouldn't lose any sleep over Skybus either. Isn't the runway expansion inteded for the FedEx hub that is slated to open sometime in 2009?
 
Yes, the extra runway was built primarily to attract the Fed-ex Mid-Atlantic hub.

While Continental Lite did try a hub in GSO the area has really grown a lot since then. That was almost 10 years ago I believe and the area has had a lot of growth especially in the airport area and in North High Point. Dell Computers opened a plant a few miles from the airport 2 years ago that brought in a lot of new industrial and high tech development. The Greensboro, Winston-Salem and High Point Metro area has an estimated combined population of 1,347,806 as of 2006.

Remember Piedmont used to do quite well with a lot of direct flights out of GSO in the 80's. Skybus also has been saying the GSO to CMH route has been one of their best performers. Could they operate profitably? Maybe? I don't doubt that given the right economics that they could draw enough from the Greensboro, High Point Winston-Salem Metro area and maybe draw some people from RDU and CLT and possibly ROA if the fares and the destinations are right. Also people in between airports places like Statesville, Hickory (HKY), Salisbury might choose to drive to GSO rather than go to CLT.
 
Remember Piedmont used to do quite well with a lot of direct flights out of GSO in the 80's. Skybus also has been saying the GSO to CMH route has been one of their best performers. Could they operate profitably? Maybe? I don't doubt that given the right economics that they could draw enough from the Greensboro, High Point Winston-Salem Metro area and maybe draw some people from RDU and CLT and possibly ROA if the fares and the destinations are right. Also people in between airports places like Statesville, Hickory (HKY), Salisbury might choose to drive to GSO rather than go to CLT.

And I can tell you first hand that people will drive to GSO from southern WV and southwestern VA if the fares/flights are right. I've even driven 3 and a half hours to RDU for the "right" fare.
 
CAL lite died in GSO and Skybus is bleeding, doubt it will be a success at GSO.

History attracts Skybus interest
Wednesday, Oct. 17, 2007 3:00 am

If Skybus Airlines expands in the Piedmont Triad, an industry expert thinks the discount airline would make a smooth landing.

History proves it, he said.

Skybus is considering Greensboro as its next "focus city" outside its home base in Columbus, Ohio. It would make multiple direct flights from Piedmont Triad International Airport at deep discounts.

The region's travelers have always flocked to a bargain, said Anthony Tangorra, chief executive officer of Latitude Transport Advisory in New York.

In the mid-1990s, Continental Airlines opened major operations at PTI.

By 1994, it flew more than 83 trips a day from the airport and had more than 600 workers here.

Passenger numbers soared to record highs.

"The Greensboro people stepped up when Continental Lite offered low-fare service," Tangorra said.

That kind of history is powerful proof of a market's strength, and Skybus has been looking carefully at those numbers.

Tangorra knows because he was pitching a startup airline two years ago to the same investors who ultimately backed Skybus. And Skybus used the Greensboro numbers for proof that its flights to this city would be profitable.

In the end, Continental pulled back because of its own financial problems, not because of problems with the Greensboro market, Tangorra said.

Since then, PTI hasn't had a full-service discount airline, and passengers have developed the habit of going to Charlotte Douglas International Airport, where US Airways offers many flights and destinations, or Raleigh-Durham International Airport, which offers lower fares.

Passenger numbers have fallen dramatically.

"You can easily retrain those passengers to fly from their own airport," Tangorra said. Skybus, he said, can tell customers, "You can drive a lot less, and we'll fly you direct and give you a low fare, and it's the airport in your own backyard."

Airport officials are working to close the deal to attract Skybus, which is considering Greensboro along with another location, reported to be Richmond. Va., where the airline currently flies.

The Piedmont Triad Airport Authority meets this afternoon to consider an incentives policy for "passenger development incentives for nonstop service to airports that are not being served from this airport."

Guilford County commissioners gave the airport authority $300,000 for this purpose in September.

Skybus is expected to announce its decision by the end of October.

Henry Isaacson, chairman of the airport authority, stressed Tuesday that no decision has been made.

"Were they to come here, at this point we are not certain of the destinations or the number of flights or the frequency," he said. "Of course, my hope is they will select us and we will know the answers to all those questions."

Isaacson would not discuss the competition.

Pat Danahy, president and chief executive officer of the Greensboro Partnership, said the airline's expansion would be a boon to the community.

"It would provide a significant number of new jobs," he said. "Number two, if Skybus is half as successful as (discount airline) Ryan Air in Europe … it will mean a significant increase in traffic through PTI.

"It will mean downward pressure on the airfares of the legacy carriers, and it will mean direct flight access to cities in the U.S. that does not exist today. … (And) it will attract a lot of publicity."
 
I wouldn't lose any sleep over Skybus either.

I'm not saying Skybus will be profitable but they were the best funded independant airline startup in history. They had 160 million in investments, Jetblue started with around 130 million back in 1999 and their still around. see storyNow granted Skybus is not going into the larger cities like Jetblue services but they probably have enough cash to give their approach a shot and if it doesn't work change their business plan before running out of cash. But they are doing a totally different approach to running an airline, they sell everything, checked luggage is extra and their flight attendants even sell merchandise on the flights. Hell, they are even selling ad-space on the outside of their planes.
 
RIC denies $50M in incentives to Skybus
Top official says no such offer has been extended to land operational base


Richmond International Airport isn't trying to lure Skybus Airlines Inc. with $50 million in incentives to choose the airport for its second operational base, the top airport official said.

Airport representatives have been talking to Skybus about increasing service and the possibility of creating a base, or hub, here.

Skybus has narrowed its choices to the Piedmont Triad International Airport in Greensboro, N.C., and Richmond, said the Winston-Salem Alliance, an economic-development group.

The group sent a letter to that area's tourism authority saying Richmond and the state of Virginia "have been very aggressive in the recruitment of Skybus," with combined financial assistance of $50 million over 10 years.

But Jon Mathiasen, president and chief executive officer of the Capital Region Airport Commission, which operates the Richmond airport, said no such financial offer has been made.

"There is no $50 million," Mathiasen said yesterday. "I don't know where that came from."

Skybus, based in Columbus, Ohio, said last month that it was considering six cities for its second base, where it could offer as many as 22 daily flights.

The airline, which started nonstop service once a day between Columbus to Richmond during May, has projected that more than 400 jobs would be created with a hub.

A decision could be made as early as the end of the month.

The Piedmont Triad Airport Authority has offered airlines an incentive for new flights. That could mean Skybus would be eligible for reimbursements that would be competitive with what the alliance believes is Richmond's offer.

Troy Bell, the marketing and air-service development director for the Richmond airport, said that marketing incentives have been provided to seven of the nine airlines serving the airport for starting flights to new destinations. The marketing support to AirTran, American Airlines, Continental, Delta, JetBlue, Northwest and Skybus came from airport funds.

AirTran, JetBlue and Skybus also received funding from a federal grant.

Skybus is expected to add another daily flight from Richmond to Columbus around the end of this year or early in 2008, Mathiasen said. Skybus said it didn't have any immediate plans to add such a flight.
 
Being that I was formerly at an Airport that constantly offered "Deals" to new entrant carriers, I can shed some light on this subject. For starters, many of the new airlines came and left soon after their incentives were gone. More than one of them "Stiffed" the airport authority for large sums of money ranging from unpaid rent to unpaid fuel bills. One airline left prematurly, and didn't get all of their incentives, so they came back a few months later so they could collect the balance. Needless to say, off they went again after their last check was in hand. Please keep in mind that some of the cash for these insentive packages come directly from the airlines that already serve the airport, and have for many years in most cases. In our local case, the airport authority actually raised the rent and landing fees to help cover their losses after one of their deals went sour. I for one don't think that any airline shoud get Squat to be lured into a new market. :down:
 
NO NO DONT TELL ME ITS SO WN has been in RDU and US is just fine there filling them up as usual and SKYBUS is planning a GSO base please dont us that.. hmmmmm i guess US should just pull out of the state of NC... like that rich butthead Dave Siegel said when WN was cumming to PHL.. OOOHHH NOOOO THEY ARE COMING TO KILL US>>>> what a arse
 
I never said that if Skybus creates a focus city that it would be doom and gloom for US. I do believe it could cause a slight decrease in O&D in CLT and possibly put downward pressure on fares in the region if they are succesfull. With oil approaching 100.00 dollars a barrel any decrease in prices in the region would not be a good thing for US.
 
US Air only servers GSO with contract carriers. Delta and United still use some big jets, as will as a couple other carriers.
 
As mentioned previously, CO-Lite Failed in GSO just as Eastwind (Yes Eastwind...run by severasl old Piedmont People) failed. As Wings mentioned, once the Money from the Airport is gone, normally the Airline follows and runs too.
 
Skybus is not Eastwind, At it's height I think Eastwind had 3- 737's and I only think one was a new one, the other was a really old 200 or something. I had a friend who was an FA and she said they had to take toilet paper from the hotel they overnighted in to stock the plane, LOL. As I said they had 160 million in startup funds, also I might add that they ordered 65 planes from Airbus, they are not starting with the costs of a traditional mainline carrier. I'm not saying they'll be sucessfull but it is not an accurate comparison to compare them to Eastwind or CO lite.