Skybus Airlines success dependent on passenger willingness to use secondary airports
Tags :
North America,
Skybus Airlines
The success or failure of Skybus Airlines depends on whether some travelers are willing to fly to smaller, secondary airports and then drive 30 minutes or more to reach destinations such as Boston or Seattle.
Skybus Airlines, which made its inaugural flight on 22-May-07, plans to service 25 cities from its Columbus hub, using a model aimed at competing with Southwest and other LCCs.
More than 200,000 tickets have already been sold. Tickets are booked solely through the company's Website to save costs, part of a business strategy that also includes charging passengers for added services. Priority boarding will cost USD10, and sandwiches and salads will cost up to USD10.
Port Columbus International Airport is already served by LCCs JetBlue and SouthWest, yet the Skybus business plan convinced local investors such as Nationwide Mutual Capital to come onboard. Skybus also received an incentive package valued at USD57 million from city, county and state officials.
"Investors like that Skybus has done what they said they would do: create an extremely efficient operating model and a great value position for travelers," said Josh Connor, a managing director at Morgan Stanley. Others are skeptical, especially with Skybus planning to offer services to mostly secondary airports, including Bellingham, about 80 miles North of Seattle, and others near Los Angeles, Boston, Greensboro, Kansas City, Richmond, and Fort Lauderdale. "The biggest pitfall for them is, will US customers accept this ultra-low cost to travel to remote airports?" said David Cahill, a visiting assistant professor at Ohio State University's Fisher College of Business. "If passengers are willing to do that, I think it's going to be an amazing business concept."
Skybus CEO Bill Diffenderffer said he's pleased with the company's progress so far. All of the company's routes are showing respectable bookings, though flights to Richmond and Kansas City are less popular than others. “Unless they were doing pitifully slow, we wouldn't think about investing in a route for just a couple of months and then pulling out," Diffenderffer said.
Date posted: 23-May-07
Other Skybus Airlines News |
Skybus Airlines success dependent on passenger willingness to use secondary airports 
