Independence Air: Low Fares and High Unit Costs?

Independence Air, the new name for Atlantic Coast Airlines, is taking a different tact from most of the other low cost carriers. It is flying regional jets which means it needs fewer passengers to break even but also that it will have higher unit costs.

Ben Mutzabaugh says they are “trying a business plan that’s never been tested before.” He apparently forgets about Midway Airlines — something that’s easy to do because it’s no longer in business.

Midway Airlines was so named because it started out at Midway airport in Chicago. In its second incarnation, it was a regional jet carrier based at Raleigh.

Midway shut down after September 11th but restarted service once federal payments arrived. After struggling some more, they tried to convert themselves into a USAirways Express carrier but that didn’t last and now they’re out of business.

Midway may or may not be an analogous case, but it’s certainly incorrect to say that an independent regional jet carrier is a business model that has never been tried before…

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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