Seniors on the Go: PEOPLExpress flies again -- but will it fly?

PeoplExpress CEO Jeff Erickson talks about the new airline.

A new airline, recycling the PEOPLExpress brand name, announced it will start flying June 30. Initial service from its base at Newport News/Williamsburg International Airport -- or, if you prefer, Patrick Henry Field -- will be two daily round-trips to Newark and one each to Boston and Pittsburgh. By the end of August, the airline expects to add round-trips to Atlanta, New Orleans, St Petersburg, and West Palm Beach.

Operators of the new line bought the PEOPLExpress name, in part, to emphasize its focus on low fares, just as the original did. The blurb that the original, started in 1981, "made air travel affordable" is a bit of a stretch, however, given that PSA started flying in 1949 and Southwest in 1967, but the first PEOPLExpress did introduce the "low base fare plus fees for everything" pricing model that has since become standard for budget airlines around much of the world.

Although neither schedules nor fares are available yet, the line promises that introductory fares and initial schedules will go live on its website, flypex.com, by June 4. And the current release says that base fares will start at "as low as" $76 each way. Presumably, pricing will follow the typical pattern of capacity control: seats allocated to different fare "buckets," and as the lower buckets sell out, the lowest available prices will keep climbing. Fees will start at $20 for one checked bag, $25 for a second, $25 for a carry-on bag in the overhead compartment, $15 for advance seat assignment, and $25 for exit-row seats, with snacks and beverages available for sale. The line also offers "Living Large" seats at $59 per flight segment, but doesn't say whether they're just ordinary seats with extra legroom or wider first-class-type seats.

Flights will be in 737-400s holding 150 seats. After some ongoing problems with paperwork, PEOPLExpress has apparently arranged with the existing Vision Airlines to operate the flights. I haven't seen whether this is strictly a short-term contract flying arrangement or a longer term partnership or merger.

As to the product, the initial PR is long on puffery and short on details. Among the initial fluff: "restoring the concepts of respect, value and excitement to the air travel experience," and "a focus on safety, comfort and quality service." Respect, value, safety, and quality service are certainly doable. As to the other claims, however, I'm not sure that air travelers really crave "excitement," and anyone who has ever flown knows that there's no way any airline can provide "comfort" in a tight-pitch 737 with the six-across seating.

The most recent large-scale mainline airline to succeed in edging its way into the competitive domestic market is Virgin America, which started in 2007 and just this year has managed to eke out its first profitable quarter. During the extended recession, we lost airlines, not gained them, and the industry's eyes will be on PEOPLExpress. If it succeeds, several other wannabes are in the wings.

Currently, the Norfolk to New York market supports 14 daily round-trips, on regional affiliates of American, Delta, and United, at advance-purchase fares starting at $365. PEOPLExpress can certainly offer lower fares, and some travelers will prefer its full-size 737s to regional planes. But the PEOPLExpress launch raises some ongoing questions:

-- Can PEOPLExpress find enough other routes to/from Newport News with enough potential traffic to support multiple 737 daily flights?

-- Will PEOPLExpress survive the inevitable competitive responses? Traditionally, in this sort of situation, the giants have stomped on new entrant competitors by slashing fares so low that the new line can't absorb the losses.

-- Some original publicity suggests that PEOPLExpress plans a hub-and-spoke system featuring connecting flights. Will that model work at Newport News?

-- Will PEOPLExpress manage to stay afloat without the local support that helped get it started?

Nobody can answer these questions for now. My suggestion: If a PEOPLExpress flight looks like a good option, try it. But don't be sure that the line will still be flying a year from now.

(Send e-mail to Ed Perkins at eperkins(at)mind.net. Perkins' new book for small business and independent professionals, "Business Travel When It's Your Money," is now available through http://www.mybusinesstravel.com or http://www.amazon.com)

(c) 2014 TRIBUNE CONTENT AGENCY, LLC.

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