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Why Major US Airlines Don't Have Low-Cost Carriers? - United Shuttle, MetroJet and Delta Express
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- čas přidán 18. 08. 2024
- Why doesn't the USA's big three have their own low-cost carriers?
But here's the thing, they actually did!
United, Delta, and American all had low-cost carriers that operated in the United States - this is their story!
The early 90s of the united states was a turbulent time for airlines; the recession plus deregulation had opened the floodgates for all sorts of new airlines to enter the market and seek their fortune. With falling prices and a market keeping pace, airlines needed to expand quickly into the new low-cost segment.
These airlines were Delta Express, United Shuttle, Contential Lite and Metrojet by US airways.
Our first on the list, Delta Express, was marketed as a no-frills airline within an airline. It would operate a fleet of Boeing 737-200 aircraft out of Orlando, and focus on the holiday travelers with an all-coach cabin - with no in-flight entertainment or meal services.
The airline was relatively successful from 1996 to 2003, but still had one problem - Delta did not manage to gain enough productivity out of the workers and planes, and so its costs remained high compared to its rivals.
Plus, the spartan Delta Express was linked so closely to the mainline operations at Delta, that it confused passengers.
Delta Express was eventually shut down in 2003 and replaced by another Delta low-cost carrier called Song.
United wasn't going to be left standing still, and in 1994, they made a deal with the pilot and mechanics union to start a new airline with the groups owning 55% of the carrier. This new airline would replicate the successful regional competitor Southwest Airlines model, a single fleet of all the same plane and no hot meals, frequent services, and a simple fare structure.
The airline would have 58 Boeing 737s and operate out Oakland airport in the bay area as a point to point airline and would offer flights to destinations such as LAX, Burbank, and Ontario for as little as $19 each way - with the new name, Shuttle By United, branded on the side of the plane.
Fast forward three years later and a change in management saw the airline turned into a hub and spoke model, feeding passengers to mainline United international flights from SFO and LAX.
But there is a problem with SFO. It gets foggy, gets worse weather than Oakland, and has a significantly higher canceled flight rate. By 1999, the airline operated solely as a feeder for international flights, and long gone was its quick turnaround and cheap fares. United no longer had any cost savings by not using the airline and folded it back into the mainline carrier.
United would go on to have a 2nd crack at the market with United Ted, but that's a topic for another video.
Continental Lite was a very short-lived subsidiary airline of Continental Airlines back in 1993 that only lasted slightly over 18 months, after losing over $300 million dollars.
The carrier used a mix of aircraft from Contential, from DC-9s to Boeing 737-500 aircraft, with all-economy cabins. The airline was based out of Cleveland and North Carolina, and at its peak, had over 80 daily flights to 45 cities.
Alas, they couldn't seem to make any money, and by 1995, the service was closed and turned back into standard Continental aircraft. If given a choice, passengers would choose the bright and bubbly southwest brand.
Metrojet. Developed as a way to stave off new low-cost competition in the US Northeast. The carrier would have a single class of service, operate a single type of aircraft, the Boeing 737-200 and fly a very limited network out of Baltimore.
The airline reportedly was actually quite nice, with 33 inches of legroom, allowing two bags with each passenger, low fares, and excellent customer service. In fact, the success of MetroJet would actually be its downfall, because it seems that no one was paying attention to the main airline US Airways.
That's right, it seems all the attention was on the wonderchild and that US Airways started to struggle. Passengers started to choose not only to not fly rival low-cost carriers but fly MetroJet over US Airways as well, cannibalizing higher paying customers. MetroJet also had the least fuel-efficient aircraft in the US Airways fleet and operated with incredibly high wages - US Airways didn't renegotiate like the other carriers but used staff from the mainline carrier.
If MetroJet was to keep growing, it would be at the cost of US Airways.
After the horrible tragedy that was the September 11th attacks, and the subsequent fall in airline demand, US Airways closed the operation swiftly and merged it back into the mainline carrier.
These airlines would not be the last time these carriers experimented with low-cost, airlines within airlines, but would be the only attempt at the magical optimistic 90s. Stay tuned for the next in the series where we look at the airlines of the 2000s that rose and fell in the blink of an eye.
Slight goof! Metrojet operated 737-200s, not 737-300s :) Forgive me! Thanks for watching :)
*forgiven*
Forgiven
Forgiven
Forgiven 😂🙋🏽♂️
Forgiven
Metrojet: Suffering from Success
Too good for its own good.
I remember my family and I used to fly Shuttle by United back in the 1990s up and down the west coast when we visited the USA, between San Francisco and Los Angeles, and San Francisco and Seattle. I always liked them because of the white version they had of the regular United Airlines livery. :)
United Shuttle was initially quite successful in terms of lower cost and higher productivity but it sadly became dysfunctional and difficult to sustain, especially after moving to SFO.
Flew both Song, Ted, and Flyi(independence air). With Ted and Song only difference i remember was leather seats. Everything else seemed the same. You should do something on independence air as well.
You don’t remember much. Song was radically different than Delta. Only 757’s, lime green accented F/A uniforms, they served mixed cocktails, and entertainment on every flight (to try & compete w/newly started JetBlue). I was a NYC based F/A at the time. We never understood why the legacy carriers created competition for themselves (& all of them failed) & we looked down on their workers. Lol. Truth was, domestically Song was better than mainline Delta. Ted & MetroJet had zilch that separated them from their parent company, so stupid. One of the names UAL was considering for it’s low cost carrier was Starfish. I kid u not. WTF??!! At least Delta made an effort with Song.
@@chasenip2 boston to Orlando Song I flew on was green 757 with leather seats, but had no infotainment system installed. I also recall the flight attendants wearing delta uniforms. May have been very early when Song was first rolled out.
I flew Independence Air to Dulles as a wee lad in 2004 in their CRJ. I actually learned of a quirk with my eyes in the return flight that still remains to this day. I wish I still had the pilot wings they gave me though :/
The series GROUNDED is so awsome i think it should be a Netflix series
And now, because of all the mergers, the competition is non-existent some places. When was the last time the government of almost any western-democracy said "no" to a big merger......There are laws in place, but why if not used?
Not used because the corpos run the state
You forgot Ted and CO light , Song etc. The reason none of them were just quite simple they still had all the legacy cost. Low fares high cost structure
I didn’t forget, they are in the video and we will cover them in part two
With Delta Express the price was right but the seats got redone with exceedingly dense foam. The crew looked like they hated their jobs but they were flying the 737-200 which was safer than the corner cutting 800's and Max's of today.For short runs we need more trains and far less planes truth be told.
I worked at UA HQ in Strategy during the Ted era and it was yet another example of “an airline within an airline” business model which was never viable for anyone. Ted was no exception. Labor costs were exactly the same as mainline UA, RASM was lower and the fleet utilization didn’t rise enough to offset the crappy yields….so what the heck was the point? I felt like the lone voice in the wilderness…
You really need to pay attention to the information you are giving out in this video which has some errors in it. Listen to 3.51 as you talk about United Airlines.
The idea of a low-cost "airline within an airline" seems to survive with "basic economy" fares. Less overhead, as they can use the same mainline flights, plus they can upsell people with upgrades.
Can you do a video about Twa because I feel like they are left out in most aviation videos
Swoop is the low cost version of Westjet in Canada
The best intro of all time
I remember back to back cancelled Shuttle by United flights, they dispactched a 747-400 between SFO and LAX.
Very interesting can't wait for the next chapter
I live in Portland, Oregon, USA. Locally, we have Alaska Airlines and its subsidiary, Horizon Air for the shorter routes, mostly flying turboprop aircraft. They don't seem to be having any problems.
I finally found time to watch this video, it’s great as usual. The Grounded series has been my fav type of video so far. Thank you found and explained!
I’ll make another!
@@FoundAndExplained can you tell us what it’ll be about?
Jet Blue has taught the big US airlines a harsh lesson and given them a damn good spanking...... which makes me laugh!!
Free entertainment on ALL flights, free WiFi on ALL flights, a partnership with Emirates and cheap fares, you can't go wrong with Jet Blue really....
Maybe you could do a video on Hong Kong airlines , a kind of underated airline?
I'm actually an expert on them. And such a shame. They just got A350s and were about to enter the world stage when the Hong Kong riots happened.
And the riots in Hong Kong were also a reason for them to cancel their A380 order
@@gabrielb9010 ha. Dodged a bullet there!
As far as i know American Airlines never had a low cost carrier. USAir had one but not AA.
Delta Express will forever be remembered for that Powerpuff Girls livery.
I'm confused,it said delta then United .Was there a mistake? 3:50
Opps! yes I mean United! :)
Four mistakes too many! You need to thoroughly review your videos before uploading them to CZcams.
When’s part 2 coming? I loved this video!
Soon! I’ll try to get them out somewhat weekly :)
@@FoundAndExplained Alright, I’ll stay tuned. :D
Part #2 never came !!
Seems like this is something that looks good on paper but actually executing it is a lot trickier.
I use to take an airline called SunJet. They flew DC-9-30 and
MD-80.
9/11 kill Delta Shuttle. I work in LGA Marine Air Terminal.
Loved working on 727 & then on the new 737-800. Service from LGA to Boston & D.C.
85% of the passengers where from Wall Street & the World Trade Center. But it’s still operating but barley hanging on. Our Chicago flight, are doing better.
I worked for USAirways and MetroJet also flew out of Birmingham (BHM) to Reagan (DCA). I was the ramp supervisor and we flew the 737-200 3 times a day. Like the videos said it didn't make much money but it was great for state representatives because they had direct flights to the capital.
You made some major typos in your script.
@Found And Explained
Did you ever do a part 2 ? I can't seem to find it
Fun Fact:Russia has their own Metrojet which crashed in 2015 due to terrorism
Correct. Not a fun fact exactly but I understand :)
You have to wonder though if the labor laws were different in the US if this practice would have stuck around of having “airline within an airline”
2:04 *A JET ENGINE!!!!!!!!!!*
Their low-cost service was probably better than their current coach service today.
Pre covid19 deltas domestic coach was great.
let's not forget Continental Lite!
Waaaaait... Delta used 737-200s in the 90s?!
Can you make a video about the SR72?
what about Song by Delta, TED by United?
Next time. These are only the planes of the 90s. We will do 2000s soon
You didn't mention Jet America Airlines ?
I Once flew with Us Airways ,and it was very similar to united and American. 🛩
USair was great. Price was right and the staff were super friendly. You just had to be OK with whistle stopping. How else would one touch down in Philadelphia, Cleveland, Charlotte, Pittsburgh and Syracuse?
8:05 fun fact that guy is the governor of arizona today
3:51 isn't this should be United rather than Delta?
Yes that’s a mistake!
Flew Shuttle by United a lot, but some markets only had two flights a day so how was that a shuttle. If it had kept to it's original idea of Oakland shuttle service to Southern California, Southwest wouldn't be the only carriers now doing that today.
Happy new 2021
Love continental
Am I tripping or did you not release a video earlier about greyhound air? Pretty sure I recieved a notification for it but can't find it now
I did not! Good idea for a topic though!
@@FoundAndExplained so weird . Thanks for the reply. Look forward to the episode one day
Monster profits??? Hmm... not quite
Exactly the same happened to British Airways low cost carrier GoFly
My aunt is a flight attendant and works for delta
Song?
Then talk about Mexicana Link and AeroMexico Travel Mexican low cost subsidiary
Didn't Eastern Airlines have a shuttle every hour that included Boston, New York, D.C.?
Watch my trump video!
I love American Airlines new livery
Guys congrats on 29k subs
Basically they where all trying to mimic southwest and failed, maybe cause SW was a low cost only from day one and didn’t try any goofy names is why they made it and set the standard?
I should do a video on why Southwest succeeded where others failed.
Metrojet runed Boeing 737-200
"MetroJet", when i have read it i first thought, that Jeremy Dewitte finally did it
Delta actually does still have a low-cost Airline carrier Delta connection so they didn't actually go bust the first version did but not the second version the second version is actually doing pretty well
Delta Connection isn’t Delta nor is it a low cost carrier, numb nuts. They are different regional, commuter airlines that contract with Delta (they get to use the Delta brand and livery) to feed mainline flights into their hubs from small cities w/small markets using Ricky dink god awful tiny toy jets. Same with American Eagle. Small regional commuter airlines that feed AA hubs. The pilots of these feeder planes are lucky to make $30K a year & F/A’s make $10-12 an hour. Walmart wages.
When you factor in the park that is regional Airlines and low-cost carriers Regional Airlines don't cost that much to fly so technically they would be classified as low cost carriers with other people that just want to get somewhere in the states so you're wrong and I will call you a numbnut
I’m with Lego builder here you’re wrong. If you have ever flown on a regional airline it is cheap as heck
@@chasenip2 I know I'm replying to a nearly year old post but still feel the need to reply because I'm a numbnuts, lol. I've never had any issues with American Eagle or Delta Connection when flying with them. My dad has been on Delta Connection A LOT and aside from a temporarily misplaced bag on the trip home one time all has been fine. I kinda like the Embraer jets too. Flying out of a spoke connection you take what you can get for flights out of here. Beats driving 2 hours to Memphis and flying out of there just because that drive sucks if you don't mind spending more on the flight.
I say value alliance I remember Asian low cost carriers
💗
I dont know if it was in your control or not but I really dislike how inaccurate the DAL 737's paint in the thumbnail
Good video though
Do you mean the Delta Express livery 737 in the thumbnail? Yes its not period accurate. I decided to do a short cut and do the eariler version of Deltas livery and slap on the Delta Express logo, as opposed to the newer and slightly different DL express livery that was actually used. Please forgive me, I had a lot of CGI to render and I saw a way to save time than remaking a whole other livery when I already had that from another video. :) Good catch tho!
@@FoundAndExplained ah
Best series ever!!! We need more 😃!!
Coming!!
The only other US low cost airline that has really challenged Southwest is Spirit; If Southwest the Target of airlines, then Spirit is Dollar Tree!
Dollar Tree that costs many dollars.
1:48 media offline
Oh yikes thanks for pointing that out
That’s what happens when I try to rush out a video
@@FoundAndExplained no problem
Third!
Great
Good
Fabulous
Marvellous
Amazing