Independence Air iClub - Another big loss

98.5 Million in Q2

http://www.flyi.com/company/pressarchive/2005/aug/080905.pdf

And running low on unrestricted cash....

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh8659 7_2005-08-09_19-18-57_n09428471_newsml

Those of us in Northern VA should be worried that the UA stranglehold will return.

98.5 Million in Q2


Ouch!!! :(

And running low on unrestricted cash....

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh8659 7_2005-08-09_19-18-57_n09428471_newsml

Those of us in Northern VA should be worried that the UA stranglehold will return.

It's gonna suck.

Welcome back to UA my friends. Good riddance AWAC. :td:

Welcome back to UA my friends. Good riddance AWAC. :td:

Welcome back to UAL price gouging at IAD, you mean.

Warning of bankruptcy, naturally.

http://www.washingtonpost.com/wp-dyn/content/article/2005/08/09/AR2005080901583.html

I'm surpirsed the west coast flights are 'less profitable'. What flights are profitable at all? And they can't blame this on fuel either, if fuel was free and that one time charge for 'impairment of long-lived assets' isn't there, they still would have lost 10 mil.

Wonder if Southwest would take over and buy their gates if Independence folded?

ugh, their break even load factor was 109%.. it was a good experiment, guys, but ditch the A319s, repaint the airplanes and see if you can get some regional contracts.

Wonder if Southwest would take over and buy their gates if Independence folded?

Will not happen; sorry. The CRJ gates at IAD can only accomadate RJs and will never be able to fit a 737. They are gournd level covered walkways and the terminal is also at ground level.

Edited to add:
I believe that their A319 gates are owned my MWAA as I have flown on DH many times out of the VS gate at IAD.

ugh, their break even load factor was 109%.

That is what the lap children are for. :p Get 4.5 per CRJ flight and they hit the magic number. Of course the fact that they don't pay a fare is just a bit of a problem.

Welcome back to UA my friends. Good riddance AWAC. :td:AWAC??? :confused:

Welcome back to UA my friends. Good riddance AWAC. :td:

Not sure what the reference to Air Wisconsin is here...

But, welcome back to UAL - I actually did not leave, UA is often less expensive than DH. But that is BECAUSE of DH. Even though I prefer DH.

UA might move back into the DH gates for RJs while I wouldn't be surprised to see jetBlue take up residence at some of DH's A319 gates. Particularly with their 190s coming soon.

Wonder if Southwest would take over and buy their gates if Independence folded?

Not likely - WN is already well entrenched at BWI, and does not have any presence at IAD. And RJs and A320s do not seem to be their type of jet.

Maybe B6 would be a hope. They could grab a few gates and perhaps pick up a couble Airbuses at fire-sale prices, and ramp IAD service back up.

UA might move back into the DH gates for RJs while I wouldn't be surprised to see jetBlue take up residence at some of DH's A319 gates. Particularly with their 190s coming soon.

Not sure the jetBlue is looking to send 190s to IAD, because their current IAD strategy seems to be Florida and a few west coast cities (specifically FLL/LAS/LGB/OAK/SAN/SMF) and all are high volume and/or transcon markets.

Not sure the jetBlue is looking to send 190s to IAD, because their current IAD strategy seems to be Florida and a few west coast cities (specifically FLL/LAS/LGB/OAK/SAN/SMF) and all are high volume and/or transcon markets.
I think their current IAD strategy has been driven by the potential & presence of DH for the past 2 years. Ever since DH announced they were leaving UA and going to run everything through IAD B6 has been fairly cautious with IAD, adding a few flights and cities but not ramping up like they are doing elsewhere. Why would they go head to head against an irrational competitor like DH? UA had to defend their markets, plus maintain connecting traffic, but no sane airline would also jump into those markets.

Once DH is out of the picture, I expect to see decent expansion from jetBlue at IAD. I think they'll fill in the rest of Florida out of Dulles and perhaps run the 190s to BOS, JFK and maybe even their other Northeast cities.

I agree. A DH pull out would be a great opportunity for JetBlue. You already have an exisiting customer base there, and I bet there are a fair number of people who use both airlines. The E170 would be perfect for the short/medium routes that DH flies.

Unfortunately, I agree...I think I nobody will be FlyingI very soon.

Unfortunately, I agree...I think I nobody will be FlyingI very soon.

Man, I hope this doesn't happen. I'm loving the $80 RT fares into BOS.

Just how low on unrestricted cash are they?
Safe for a month yet? a quarter? (yes, I know this is all speculation)

I assume the poster who slammed AWAC meant ACA, the last regional carrier iteration of FlyI before they struck out away from shore without a life jacket.

So is there any chance that they can file for bankruptcy, bring in a little cash, return the A319s and. . . prolong the losses?

I really want this airline to stay around, even if I don't really want to fly them. :o

Similar sentiments at http://www.thedeal.com/NASApp/cs/ContentServer?pagename=hpa&c=TDDArticle&cid=1123531663761&p=M4YD5AR1 .

The carrier filled only 72.6% of its seats during the second quarter, usually one of the busiest periods on an airline's calendar, as competitors offered low fares and extra perks to keep customers from defecting to the competition.

Bob McAdoo, airline analyst with Prudential Equity Group LLC, said FLYi would not have been profitable even if every seat had been sold.

Flyi's Rating Lowered to 'Negative'



--------------------------------------------------------------------------------


Bond-rating agency Standard & Poor's yesterday lowered its rating of Flyi, parent of Dulles-based Independence Air, from "developing" to "negative." The move followed Flyi's disclosure Tuesday that it is making contingency plans for a potential Chapter 11 bankruptcy protection filing.

I'm surpirsed the west coast flights are 'less profitable'. What flights are profitable at all?

OK, I'll try and tackle this one. If you look at the prices, West Coast flights earn less revenue per mile than flights within the East. Also, taking fuel burn into consideration, a sold out A319 flying one roundtrip to the West can be less profitable than one flying multiple daily roundtrips in the East, even with less full loads. Hence, additional A319s to BOS & JAX.


Cheers.

ugh, their break even load factor was 109%.. it was a good experiment, guys, but ditch the A319s, repaint the airplanes and see if you can get some regional contracts.

So is there any chance that they can file for bankruptcy, bring in a little cash, return the A319s and. . . prolong the losses?

I really want this airline to stay around, even if I don't really want to fly them. :o

I understand what is meant about returning to being a regional carrier, but just a note that the A319s are NOT the problem. In terms of unit costs, including fuel efficiency, the CRJs are twice as expensive as the A319s. Secondly, if you are going to be paying to send a plane up, its better for the airline to be able to put 132 pax on that departure, instead of 50. Again, this explains the move to all Airbus BOS flights, as well as the JAX, CLT & PWM flights.


Cheers.

Also, using the same aircraft type for all flights on a route can potentially reduce some of the costs depending on what you need at each end.

I hope they can hold it together, but they've got to figure out what they can do to get costs and revenue more in line. I've been trying to drive some of my corporate business to DH and there's been at least a few people that I've gotten to fly DH instead of one of the other possible airlines.

Still, a C11 filing is not the end of the world -- UA has been in C11 and losing money since 2002, and they're still flying. All C11 means is that the existing investors are pretty much wiped out; C7 is when the passengers get in trouble as well.

Just thinking about it a little bit, what might be the likelyhood that jetBlue would sweep in during a bankruptcy filing and pick up the RJs and routes for feeding IAD and JFK if they could make sense out of it? I've been surprised that they haven't worked their way out to smaller markets thus far, though the announcement of the 190s is definately a sign they're extending in that direction.

Just thinking about it a little bit, what might be the likelyhood that jetBlue would sweep in during a bankruptcy filing and pick up the RJs and routes for feeding IAD and JFK if they could make sense out of it? I've been surprised that they haven't worked their way out to smaller markets thus far, though the announcement of the 190s is definately a sign they're extending in that direction.
I can't see B6 ever going after RJs. Their current load factor is around the 90s, leaving very little spare capacity. RJs have a very high unit cost, and as DH has made clear, they can not form a profitable basis for a discount airline.

Also, using the same aircraft type for all flights on a route can potentially reduce some of the costs depending on what you need at each end.

I hope they can hold it together, but they've got to figure out what they can do to get costs and revenue more in line. I've been trying to drive some of my corporate business to DH and there's been at least a few people that I've gotten to fly DH instead of one of the other possible airlines.

Still, a C11 filing is not the end of the world -- UA has been in C11 and losing money since 2002, and they're still flying. All C11 means is that the existing investors are pretty much wiped out; C7 is when the passengers get in trouble as well.

Just thinking about it a little bit, what might be the likelyhood that jetBlue would sweep in during a bankruptcy filing and pick up the RJs and routes for feeding IAD and JFK if they could make sense out of it? I've been surprised that they haven't worked their way out to smaller markets thus far, though the announcement of the 190s is definately a sign they're extending in that direction.

I can think of another reason to give your business to DH: their pilots, FA's, and mechanics aren't likely to strike. With all the crap that's going on with BA and Gate Gourmet, I'm more than a little nervous that a major carrier will run into labor issues.

Welcome back to UAL price gouging at IAD, you mean.


How is it considered "price gouging"? UA is barely making money and FlyI is hemorrhaging cash. Did you ever think FlyI isn't charging nearly enough? Take advantage of the cheap flights while you can because you'll be paying fair market value again very soon.

As far as business decisions are concerned, converting to FlyI from a UX carrier ranks up there ranks up there with Montana Power selling all of their power plants, burying fiber and renaming the company Touch America.

How is it considered "price gouging"? UA is barely making money and FlyI is hemorrhaging cash. Did you ever think FlyI isn't charging nearly enough? Take advantage of the cheap flights while you can because you'll be paying fair market value again very soon.

As far as business decisions are concerned, converting to FlyI from a UX carrier ranks up there ranks up there with Montana Power selling all of their power plants, burying fiber and renaming the company Touch America.

I think $700 or more roundtrip IAD-GSO (37-minute flight) unequivocally qualifies as price gouging. I'm not looking forward to the return of those days.

I can think of another reason to give your business to DH: their pilots, FA's, and mechanics aren't likely to strike. With all the crap that's going on with BA and Gate Gourmet, I'm more than a little nervous that a major carrier will run into labor issues.
NW is looking head-on into some serious labor issues with the Mechanics (AMFA) and they just irritated the Pilots (ALPA) too.

NW is looking head-on into some serious labor issues with the Mechanics (AMFA) and they just irritated the Pilots (ALPA) too.

On my last DH flight to BOS, the flight was delayed because of crew availability issues. Specifically, they didn't have a first officer.

So they managed to get a pilot to come in ON HIS DAY OFF and fly for them. The guy was there ready to fly in 45 minutes. When they announced his name on the flight, everyone gave him a round of applause.

I can't imagine a major carrier getting that kind of dedication from it's pilots.

That's a BIG reason that I like the smaller carriers. They are hungry and they want to succeed. I like the flexibility and service that you can get with a major carrier but I feel that their cost structures and cultures don't lend well to staff going the extra mile to take care of customers.

I also think that a lot of customers remember the treatment they got when prices were high and there were few options. Since they're likely to be treated like dirt anyhow, might as well not pay through the nose.

If you've ever been yelled at by a FA on a transcontinental for asking for more coffee, you'll understand what I mean.

A little side note: I'm sure most people think that Greyhound is synonymous with bus travel in the US but about a year ago or so some small bus lines started offering trips from DC to NYC for about 1/5th of what Greyhound was charging for the same trip. You also got picked up next to a metro stop and close to a coffee shop. Customers flocked to them like droves and eventually they forced Greyhound to reduce their prices. Of course, why would you return to Greyhound when you got a superior product for the same price?

I do believe that the majors will find that they must quickly adapt to the new environment or they will suffer a similar fate. I, for one, find that the simple and efficient service I get from the LCCs is superior to the service I get from the majors for a higher price. That's the REAL problem facing the majors.

The 'real' problem of the majors is a cost structure than market demand won't support.

The 'real' problem of DH is that they can attract customers and more or less fill planes, but only at price levels below cost. As already mentioned on this thread, in the 2Q they'd have lost money even if fuel was free... break-even load factor 109%.

They wouldn't even still be around today if GE hadn't thrown DH a lifeline, purely in a move to protect some fictional values on their balance sheet.

Hoping DH makes it, somehow, but not optimistic.

I think $700 or more roundtrip IAD-GSO (37-minute flight) unequivocally qualifies as price gouging. I'm not looking forward to the return of those days.


@:-) If you don't like the price then drive! You have other alternative and economics dictates that if economic profits exceed a certain point then competition will be attracted to the market.

The simple fact is FlyI is run by a bunch of complete morons. What other company that's headed for bankruptcy would offer pricing that would prevent them from making a profit unless they fill a plane with more people than they possibly can??? The bankruptcy of FlyI will further validate Darwin.

@:-) If you don't like the price then drive! You have other alternative and economics dictates that if economic profits exceed a certain point then competition will be attracted to the market.

The simple fact is FlyI is run by a bunch of complete morons. What other company that's headed for bankruptcy would offer pricing that would prevent them from making a profit unless they fill a plane with more people than they possibly can??? The bankruptcy of FlyI will further validate Darwin.

I'm not so sure they are morons.

They've made it this far and they are doing their best to stay afloat.

If I were to hazard a guess, I'd say that there are market forces that are driving their pricing decisions that are a bit opaque to us here in our armchairs.

Crazier things have happened in the world than a small upstart gaining market share by pricing and profitability by altering their product mix.

@:-) If you don't like the price then drive! You have other alternative and economics dictates that if economic profits exceed a certain point then competition will be attracted to the market.

You seem to gloss over the precarious financial situation of your beloved airline.

The crazy prices UA (and US, for that matter) charges to small markets will only hurt it in the end. It really turns off the flying public, especially the leisure market. I'm sure GSO is praying for WN or B6 to swoop in after the death of DH.

A little side note: I'm sure most people think that Greyhound is synonymous with bus travel in the US but about a year ago or so some small bus lines started offering trips from DC to NYC for about 1/5th of what Greyhound was charging for the same trip. You also got picked up next to a metro stop and close to a coffee shop. Customers flocked to them like droves and eventually they forced Greyhound to reduce their prices. Of course, why would you return to Greyhound when you got a superior product for the same price?



I sure hope that DH is nothing like those bus carriers, which are operated by Chinese Triads and routinely break safety regulations (ie, drive 80 on the NJ TPK) and skimp on maintenance. Its only a matter of time before one of those things flips over and the whole industry comes crashing down. Then its back to Peter Pan and Greyhound.

I sure hope that DH is nothing like those bus carriers, which are operated by Chinese Triads and routinely break safety regulations (ie, drive 80 on the NJ TPK) and skimp on maintenance. Its only a matter of time before one of those things flips over and the whole industry comes crashing down. Then its back to Peter Pan and Greyhound.

I hadn't heard about the Triad connection. What's your source?

The owner of the the bus line I used wasn't one of those "chinese" bus lines:

www.washny.com (http://www.washny.com)

If memory serves, the owner is a hassid.

I really want this airline to stay around, even if I don't really want to fly them. :o
And there you have the whole airline industry problem summed up in one simple sentence. People want and expect fares below cost basis. When asked to pay market rates they consider that they're being gouged. Entrants like FlyI pander to the customer's expectation of unreasonably low fares; they can't possibly make money, but while they're alive they destabilize their markets for all comers. And consumers prefer to take advantage of the "FlyI effect" on UA fares to flying FlyI itself.

Someone else here said, "I'm loving those $80 RT fares to Boston." Fares like that are not only killing FlyI, they're killing the whole industry, and the sooner irrational competitors like FlyI that force those fare levels on the market are gone, the better.

I have said since before FlyI's launch that it was a stupid, doomed experiment, not materially different from Presidential Airways (which hubbed at IAD in the late '80s and also died quickly). It'd be dead by now if it weren't for GE. Sorry about the jobs and everything, but for God's sake, shut 'er down and stop blowing all this money,

You seem to gloss over the precarious financial situation of your beloved airline.

The crazy prices UA (and US, for that matter) charges to small markets will only hurt it in the end. It really turns off the flying public, especially the leisure market. I'm sure GSO is praying for WN or B6 to swoop in after the death of DH.

They usually charge decent prices for the leisure market to connect in their hub - just not to fly non-stop to the hub. For example, a United flight fron SBN-ORD costs more than SBN-ORD-SFO. From downtown Chicago its a 45 minute train ride (or 30-90 minute drive) to O'Hare plus a 50 minute flight to South Bend. Arriving at the airport 30 minutes early means the total travel time will be at least 2 hours. For $10 you can also take a commuter train from downtown to Chicago to South Bend airport in a little over two hours. Or you could drive to South Bend in less than 2 hours (traffic permitting.)
In order to really competitively price these flights, UA would have to sell round trips for $20, a fare that probably wouldn't even cover taxes, let alone cover any of their expenses.
By pricing those short trips at 'crazy prices' they maintain the capacity for connecting flights to other locations, while still allowing people to take the short hops if they really want to. Thus it could actually improve air-travel options.
If the short RJ flights were priced at break-even cost, they would still likely be viewed as expensive by the local passengers. Pricing them below cost may help attract demand, but would lead to great loses.

And there you have the whole airline industry problem summed up in one simple sentence. People want and expect fares below cost basis. When asked to pay market rates they consider that they're being gouged. Entrants like FlyI pander to the customer's expectation of unreasonably low fares; they can't possibly make money, but while they're alive they destabilize their markets for all comers. And consumers prefer to take advantage of the "FlyI effect" on UA fares to flying FlyI itself.

Someone else here said, "I'm loving those $80 RT fares to Boston." Fares like that are not only killing FlyI, they're killing the whole industry, and the sooner irrational competitors like FlyI that force those fare levels on the market are gone, the better.

I have said since before FlyI's launch that it was a stupid, doomed experiment, not materially different from Presidential Airways (which hubbed at IAD in the late '80s and also died quickly). It'd be dead by now if it weren't for GE. Sorry about the jobs and everything, but for God's sake, shut 'er down and stop blowing all this money,

That was ME lovin those fares.

And sorry...tell me what relationship to cost basis the fares I was paying had WAY BACK WHEN there was little to no competition?

Are you telling me that the fare I should be paying was that jacked up rate from the 80's before deregulation? Or even soon after? What do you think a RT fare to BOS should cost?

You can blame the customer all you want for the sorry state the airlines are in. But I'll never buy it. I think it has MUCH more to do with training customers how to choose. Like the point I made earlier...if I'm going to get treated like dirt ANYHOW, I might as well pay the least I can. And the airlines did that for FAR too long to forestall the emergence of the LCC's.

Customers aren't dumb. They see one airline charging $800 for a flight that another one charges $200 for, and they think, HUH?!? There has LONG been the feeling that the prices charged by the majors had no bearing on reality anyhow. That's why you're not seeing any hankies come out when the majors cry about how they're not covering their costs.

I really want this airline to stay around, even if I don't really want to fly them. :o

My sentiment exactly. Unfortunately, I think many average consumers see it this way as well... "Let DH keep the fares low but I'll continue to fly UA".

My sentiment exactly. Unfortunately, I think many average consumers see it this way as well... "Let DH keep the fares low but I'll continue to fly UA".

Exactly. People are pleased to have lower UA fares owing to the FlyI Effect, but they prefer not to actually change their behavior and FlyI themselves. Then when FlyI goes under and UA jacks the rates back up, they go back to complaining about the lack of competition.

For mid: thank you for your comments. No, consumers aren't stupid -- to a point. You naturally prefer a low fare, but now irrational carriers like FlyI have taught people to expect fares that don't cover the cost of transporting them. You know it costs more than $40 to fly you IAD-BOS -- your share of landing fees and jet fuel alone come to more than that. So when you opt for the lowest fare you are opting to sustain chaos in the marketplace.

In other economic sectors there are laws against "dumping" -- selling imported goods for less than their cost of manufacture -- for precisely this reason.

I don't support price-gouging by the airlines either. I think the price of a ticket to Boston should consist of the cost of getting you there plus a 10 percent profit. But that would be regulation, and the US chucked regulation 28 years ago in favor of a model that has bankrupted almost everybody and cost hundreds of thousands of jobs -- including, soon enough, those of FlyI workers.

Exactly. People are pleased to have lower UA fares owing to the FlyI Effect, but they prefer not to actually change their behavior and FlyI themselves. Then when FlyI goes under and UA jacks the rates back up, they go back to complaining about the lack of competition.

For mid: thank you for your comments. No, consumers aren't stupid -- to a point. You naturally prefer a low fare, but now irrational carriers like FlyI have taught people to expect fares that don't cover the cost of transporting them. You know it costs more than $40 to fly you IAD-BOS -- your share of landing fees and jet fuel alone come to more than that. So when you opt for the lowest fare you are opting to sustain chaos in the marketplace.

In other economic sectors there are laws against "dumping" -- selling imported goods for less than their cost of manufacture -- for precisely this reason.

I don't support price-gouging by the airlines either. I think the price of a ticket to Boston should consist of the cost of getting you there plus a 10 percent profit. But that would be regulation, and the US chucked regulation 28 years ago in favor of a model that has bankrupted almost everybody and cost hundreds of thousands of jobs -- including, soon enough, those of FlyI workers.

Don't get me started about dumping laws. I believe in strict laissez-faire capitalism. Anti-dumping laws are just political tools designed to get votes. There is no economic justification for them.

Maybe $40 is too little to charge to get to BOS from IAD. What the hell do I care? I paid high fares for years. Now that the pendulum has swung in my direction, I'm supposed to be concerned about the health of the airline industry?!?! When I was paying WAY above cost I should forget that and now forgo paying WAY below cost?

Economics is economics and the marketplace is always chaotic. That is, if it's functioning correctly. Go back and get a copy of anything by Milton Friedman.

I'm grabbing up all of the low fares I can while the getting is good. If we have one plane left in the country and people have to sit on laps to get to business meetings, I won't feel the least bit guilty. I know that these things go in cycles and when there is money to be made, those planes will be in the air.

Maybe $40 is too little to charge to get to BOS from IAD. What the hell do I care?
You care because ruinous, destructive pricing activity like that eventually flushes most entrants from the marketplace and results in monopolist rates that fewer people can afford. I understand Milton Friedman perfectly well, but airline economics are uniquely irrational and unstable. Read Thomas Petzinger's "Hard Landing" for good insight.

You're right, though, things do run in cycles, and because of all this lunacy we are cycling back to a period of bankruptcies, consolidations, less capacity and higher fares.
When there is money to be made, those planes will be in the air.
But there isn't, so eventually they won't.

You care because ruinous, destructive pricing activity like that eventually flushes most entrants from the marketplace and results in monopolist rates that fewer people can afford. I understand Milton Friedman perfectly well, but airline economics are uniquely irrational and unstable. Read Thomas Petzinger's "Hard Landing" for good insight.

You're right, though, things do run in cycles, and because of all this lunacy we are cycling back to a period of bankruptcies, consolidations, less capacity and higher fares.

But there isn't, so eventually they won't.

Bleh. Monopolist rates? You think that if there was one surviving airline in the whole US and they jacked up rates to $2000 RT per passenger that there wouldn't be someone out there the next week offering flights for $1000?

Creative destruction and consolidation is a FEATURE of a vibrant economy.

Bankruptcy? Big deal.

Consolidation? Big deal.

Less capacity? Aren't you arguing for that anyhow? You think FlyI should give up the ghost because they see Adam Smith's hand moving their way?

Higher fares? See less capacity.

You seem SO worried about all this money being wasted...whose money is it? Not mine! Those investors are the ones who signed up. As well as the investors of GE and Airbus. I don't own stock of either of those companies so once again: What do I care?

BTW, anyone can write a book these days. Just because he got some ink onto a page doesn't mean he's right.

[QUOTE=BearX220].

For mid: thank you for your comments. No, consumers aren't stupid -- to a point. You naturally prefer a low fare, but now irrational carriers like FlyI have taught people to expect fares that don't cover the cost of transporting them. You know it costs more than $40 to fly you IAD-BOS -- your share of landing fees and jet fuel alone come to more than that. So when you opt for the lowest fare you are opting to sustain chaos in the marketplace.

In other economic sectors there are laws against "dumping" -- selling imported goods for less than their cost of manufacture -- for precisely this reason.

QUOTE]

Sorry, but the statement about creating chaos in the market place but selecting $40 fares is just crazy.

The concept you aren't getting is that not every fare is $40. On some days, on some flights, it might be...but try getting that fare during peak hours and travel times. I've seen FlyI charged $189 one way on that same route--which is far more than fees, fuels and 10 percent profit. I'm not complaining about that, its all supply and demand.

But my point is that you can certainly offer these very low fares and still be competitive by charging more when you can. It evens out in the end...you might lose money on a given pax, but you'll make it up by overcharging another passenger who really needs to be on that flight and pays for it.

For some of these flights, the altnerative is NO revenue at all. So FLYI rightly figures that it would rather re-coop at least some of the cost by charging $40 and getting some pax rather than flying an mostly empty plane and getting nothing.

If you want proof that you can charge very low fares and be profitable, just hop over to BWI (something I hate to do). I was looking at the Ding! fares last night..BWI-PVD $23 one way (total roundtrip with taxes came to $66). And there was plenty of availability on that fare. They're not losing money.

I hadn't heard about the Triad connection. What's your source?

The owner of the the bus line I used wasn't one of those "chinese" bus lines:

www.washny.com (http://www.washny.com)

If memory serves, the owner is a hassid.

Not all, of course, are "Chinatown" buses. And some probably are legit. The one you took bills itself as a 'deluxe' service and probably is above board. But there have been numerous stories about the organized crime connections to these bus lines, and NYPD OCCB (Organized Crime Control Bureau) has been investigating.

In addition, NYPD seized 16 buses for safety violations in 2004, in one of many incidents (in March one caught on fire in CT). Steer clear of these things, and we better hope FlyI isn't run like that!

http://www.nydailynews.com/front/story/92843p-84289c.html
Chinatown bus war
fuels probe

Slain businessman tied to mob, cops say

By PATRICE O'SHAUGHNESSY
DAILY NEWS STAFF WRITER


Buses line up along Forsyth St. between Division St. an East Broadway, waiting to bring passengers to Chinatowns in other cities.

De Jian Chen was chased down and riddled with bullets last month, dying in the shadow of the Manhattan Bridge, around the corner from where Chinese immigrant workers, college students and tourists board idling buses with exotic names like Dragon Coach, Lotus Tours and Fung Wah.
De Jian Chen was a player in Chinatown's lucrative and violent discount bus wars.

Some 250 coach buses and vans ferry people in and out of Chinatown daily, taking gamblers to Atlantic City and commuters from Chinatown to Flushing, Queens, and Sunset Park, Brooklyn. But the most profitable runs are to other East Coast Chinatowns.

Fares range from $12 to $35, which in some cases is nearly half the cost charged by established bus companies. Authorities estimate the New York to Philadelphia route alone can bring a Chinatown business more than $1 million a year.

With such profits, the legitimate businesses may have drawn the tentacles of organized crime - the Chinatown gangsters who prey on fellow immigrants.

The Manhattan district attorney's office is working to build a racketeering case, law enforcement sources said.




http://www.columbiaspectator.com/vnews/display.v/ART/2004/02/27/403f0ca9d80d7
Crime Connected to Chinatown Buses
Murders in Chinatown Blamed on Drivers of Low-Priced Bus Services
By Josh Pozen
Spectator Staff Writer

February 27, 2004

Charging just $10 to travel from Manhattan to Boston, the bus companies that run out of New York City's Chinatown may seem like a student's dream come true--that is, if one can overlook this week's murder investigation.

Police have been investigating various crimes in the area that they believe are connected to the low-fare bus businesses operating in numerous Chinatowns across the Northeast. In New York, two men have been stabbed to death on the streets of Chinatown since October, both of whom worked for such companies.

On Oct. 30, 2003, Zhen Ki Li, a 31-year-old employee of the New Century Bus Company, was stabbed nine times on the corner of Pike and Henry Streets. The investigation of the stabbing quickly yielded the alleged murderer--Li's business partner, Lei Chen.

The latest crime associated with this industry--for which no one has been charged--occurred weeks ago, on the corner of Division and Market Streets, when one bus company employee was stabbed 17 times. According to a spokesman for the fifth precinct, which includes Chinatown, police suspect that the murderer is a driver for one of the companies.

A massive surprise inspection, which affected all of the Chinatown bus companies, came a week later. The Organized Crime Investigation Division and the NYPD searched about 100 of these buses, 16 of which have been taken off the road until certain mechanical problems are fixed. Fung Wah Bus, the first line of Chinatown buses and, according to its Website, also "the largest bus service provider between New York and Boston," had two of its buses confiscated in last week's inspection.