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People Express Airlines

 

People Express Airlines

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This article is about the airline that operated during the 1980s. For the planned airline, see People Express Airlines (2012).

PEOPLExpress
150px
IATA
PE
ICAO
PEX
Callsign
PEOPLE
Founded 1981 (1981)
Ceased operations 1987 (1987) (integrated into Continental Airlines)
Hubs
Focus cities Baltimore Washington International Airport
Fleet size 75
Destinations 50
Parent company People Express Airlines, Inc.
Headquarters Newark, New Jersey
Key people Don Burr
(First CEO)
Beverly Lynn Burns
(First Woman Boeing 747 Airline Captain)

People Express Airlines, stylized as PEOPLExpress, also known as People Express Travel, was an American low-cost airline that operated from 1981 to 1987, when they merged into Continental Airlines. The airline's headquarters was in the North Terminal of Newark International Airport in Newark, New Jersey.

History

Founding and rapid expansion

The company was founded Don Burr, Gerry Gitner and several others, who resigned from Frank Lorenzo's Texas International in order to do so. Burr was influenced by British airline entrepreneur Freddie Laker, whose forays into low-cost air travel attracted much press in the 1970s. Terminal space was leased at Newark Airport's long-abandoned North Terminal.


People Express (PEx) was launched on April 30, 1981 with 737s from Newark to Buffalo, Columbus and Norfolk; Jacksonville and Cleveland Hopkins were added a month later. In December PE had 42 weekday departures from EWR to Baltimore/Washington, Boston Logan, Burlington, Buffalo Niagra, Port Columbus, Jacksonville, Norfolk, Sarasota-Bradenton, Syracuse Hancock and Palm Beach plus some flights around the periphery of the hub-and-spokes.

On May 26, 1983 People Express began non-stop flights from Newark to London's Gatwick Airport with a leased Boeing 747-227B previously operated by Braniff International Airways. Flights started at $149 each way. The airline was an instant success with all flights sold out for several months within 24 hours of being offered. Later the airline added Montréal-Mirabel and Brussels. Template:Rail freight The airline used a simplified fare structure. All seats on a route were offered at the same price except for slightly-lower "off-peak" fares. All seats were in economy class except for "Premium Class" on overseas flights. Fares were paid in cash aboard the aircraft early in the flight. Passengers were permitted to bring one carry-on bag for free and each checked bag cost $3.00. People Express was the first United States airline to charge a fee for each checked bag. People Express also charged modest amounts for customers wanting food or beverages. Sodas cost 50 cents per can, honey-roasted peanuts and Rachel's brownies were also 50 cents, and the famous People Express "snak-pak" (an assortment of cheeses, crackers and salami) cost $2.

Acquisitions of other airlines

In 1985 People Express bought out Denver-based Frontier Airlines. The combined company had flights to most major U.S. cities and to Brussels. People Express also bought midwest commuter carrier Britt Airways and Provincetown-Boston Airlines (PBA), a regional airline serving New England and Florida.

The purchasing spree placed an enormous debt burden on the carrier at the same time major legacy carriers' improved yield management schemes enabled them to better compete with People Express fares. Integrating Frontier's operations caused labor struggles within the newly absorbed airline, and the change to a low-fare, no-frills mentality alienated Frontier's passengers.

Debt pressure on the carrier forced a change in philosophy, as People Express sought to lure business travelers who would pay higher fares. Aircraft cabins were redesigned to include a first-class section, a frequent flyer plan was initiated, and the simplified fare structure was abandoned in favor of the now-usual "revenue management" pricing.

Merger with Continental Airlines

The failed integration and enormous debt stretched People Express too far, and in June 1986, the company announced they were working with an investment bank to seek buyers for part, or all, of the airline. A deal to sell Frontier off to United Airlines fell through due to the inability of United to agree to terms with their unions on how to incorporate Frontier's staff, leading People Express management to cease Frontier's operations and file for bankruptcy protection for the subsidiary.

In the end, People Express was forced to sell entirely to Texas Air Corporation for roughly $125 million in cash, notes, and assumed debt. Due to concerns about regulatory approval for the purchase, Texas Air purchased the assets of Frontier from People Express in a separate transaction worth $176 million. People Express ceased to exist as a carrier on February 1, 1987, when their operations were merged into the operations of Continental Airlines, another Texas Air subsidiary, under a joint marketing agreement.

People Express' spartan, no-frills service earned the carrier several derisive nicknames, including "People Distress" and "Air Bulgaria" (a sarcastic reference to the poor customer service associated with Eastern Bloc countries during the Cold War).[1]

Reuse of name

On February 13, 2012, Newport News/Williamsburg International Airport announced the resurrection of the PEOPLExpress brand for a new, start-up airline.[2] Corporate headquarters for the airline will also be located in Newport News.

PeoplExpress Airlines has applied for permission to fly from Pittsburgh, with plans to begin service later this year. It will begin by serving Pittsburgh, Orlando, West Palm Beach, Providence, and Newport News. The paperwork has been filed with the Department of Transportation.[3]

Fleet

This was the fleet at the time of People Express's buyout from Continental Airlines.

People Express Fleet
Aircraft Total Passengers
(Economy)
Notes
Boeing 727-200 50 185
Boeing 737-100 17 118
Boeing 737-200 5 130
Boeing 747-100 3 435 Bought from Alitalia
Boeing 747-200 6 435

Headquarters

The PeopleExpress headquarters were on the grounds of Newark International Airport.[4] The headquarters offices, described by the Miami Herald as "a maze-like bevy of small offices," were in an attic,[5] located on the second floor of the North Terminal.[6][7] The North Terminal first opened in 1953.[8] Before the arrival of PeopleExpress, the terminal was largely unused, while it had some charter flights departing and arriving there.[9] After the end of PeopleExpress, the Department of Veterans Affairs used the former terminal as a transfer point for casualties in the Gulf War.[10] In 1997 a project to demolish the North Terminal and redevelop the land was underway, with a cost of $50.1 million.[11]

References

External links

New Jersey portal
Companies portal
Aviation portal
  • The Airchive-People Express Timetables
  • Aviation Safety Network - People Express
  • Remember PEOPLExpress? The Article Writer, January 16, 2006
  • The Rise and Fall of PEOPLExpress Eric Kochneff, August 2004
  • People Express Management Flight Simulator by Prof. John Sterman, MIT
  • Images, historical notes, and promotional materials Airlinecolors.com

Template:United Continental Holdings

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