People Express Airlines (1980s)

PEOPLExpress

IATA ICAO Callsign PE PEX People Express
Founded	1981
Ceased operations	1987 (integrated into Continental Airlines)
Hubs	Newark International Airport Stapleton International Airport
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 ( 1st CEO), Frank Lorenzo (Last CEO)

PEOPLExpress Airlines, also known as People Express, was a U.S. no-frills airline that operated from 1981 to 1987.

History

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

File:Peoplexpress1.jpg

PEOPLExpress Livery Colors

People Express was launched on April 30, 1981 with service from Newark to Buffalo, Columbus, and Norfolk, Virginia. People Express grew rapidly, adding flights to Florida by the end of the year.

On May 26, 1983, PEOPLExpress (PEx) began non-stop service from Newark to London's Gatwick Airport with a leased Boeing 747-227B previously operated by Braniff International Airways. Flights were priced at $149 each-way and upon launch, became an instant success with all flights sold-out for several months within 24 hours of being offered. Later, the airline would add Montréal-Mirabel and Brussels to its international network.

The airline used a simplified fare structure whereby all seats on a given route were offered at the same price, with slight differences between "Peak" and "Off-Peak" fares. All seats were in economy class, with the exception of "Premium Class" seating on overseas flights. Fares were paid on the flight. Passengers were permitted to bring one carry-on bag for free, while each checked bag was charged a fee of $3.00. People Express was the first United States airline to charge a fee for each checked bag. PEx also charged modest amounts for customers wishing food or beverages. Sodas cost 50 cents per can, honey-roasted peanuts and Rachel's brownies (also 50 cents), and the "famous" People Express "snak-pak" (an assortment of cheeses, crackers and salami) for $2.

In 1985, People Express bought out Denver-based Frontier Airlines. The combined company became the United States' fifth largest airline, with flights to most major U.S. cities, as well as an additional transatlantic route to Brussels. During this period, People Express also purchased midwest commuter carrier Britt Airways and Provincetown-Boston Airlines (PBA), a regional airline with route networks in New England and Florida.

The aggressive purchasing spree placed an enormous debt burden on the carrier at the same time major legacy carriers' improved yield management schemes enabled them to compete better with People Express on fares. Furthermore, integrating Frontier's operations caused labor struggles with 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 travellers who were willing to pay higher fares. Aircraft cabins were redesigned to include a first-class cabin, a frequent flyer plan was initiated, and the simplified fare structure was abandoned in favor of a more traditional airline industry pricing scheme.

The failed integration and enormous debt stretched People Express too far, and in June, 1986, the company announced it was 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 its unions on how to incorporate Frontier's staff, leading People Express management to cease Frontier's operations and file the subsidiary for bankruptcy protection.

In the end, People Express was forced to sell itself entirely to Texas Air Corp 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 its operations were merged into the operations of Continental Airlines, another Texas Air subsidiary, under a joint marketing agreement.

Homer Simpson mentions People Express in episode 9F21 of The Simpsons while recalling events of the 1980s: "...People Express introduced a generation of hicks to plane travel".

The Fleet

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

People Express Fleet

Aircraft	Total	Passengers (First/Economy)	Notes
Boeing 727-200	50		Bought from Delta Air Lines, Braniff, Alitalia
Boeing 737-100	17		Bought from Lufthansa
Boeing 737-200	5		Bought from Canadian Pacific Airlines
Boeing 747-100	3		Bought from Alitalia
Boeing 747-200	6		Bought from Braniff, Alitalia, Qantas

External links

• The Airchive-People Express Timetables
• People Express' Model T
• Aviation Safety Network - People Express
• Remember PEOPLExpress?, The Article Writer, January 16, 2006
• The Rise and Fall of PEOPLExpress, Eric Kochneff, August 2004
• CP Air 737
• People Express Management Flight Simulator by Prof. John Sterman, MIT