Independence Air

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Independence Air was a low-cost airline based in Loudoun County, Virginia, United States (near Washington, D.C.) that operated from 1989 until 2006. It ceased all operations at 8:24pm UTC-5 on January 5, 2006. It had been in Chapter 11 Bankruptcy since November 7, 2005. [1] Its route network focused on the east coast of the United States, but extended to the west coast. Its route network was based at Washington Dulles International Airport.

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History

Independence Air started life as Atlantic Coast Airlines on December 15, 1989, operating feeder services as United Express for United Airlines and Delta Connection for Delta Air Lines. After United withdrew the contract, Atlantic Coast reinvented itself as low-cost carrier Independence Air. It was announced on November 19, 2003 and operations as Independence Air began on 16 June 2004. At its inception, it was unique among low-cost carriers in that its fleet mainly consisted of 50-seat regional jets, although the airline then went on to operate larger Airbus A319s as well.

On May 20, 2004, Independence Air signed a deal with the Washington Redskins to become the Official Airline of the team for three years.

In addition to the almost inevitable low cost tagline in its marketing, Independence Air became quickly known for the humorous touches it added to the flying experience, such as replacing the flight attendant safety announcements with prerecorded versions of the warnings by celebrities such as James Carville (addressing the left side of the plane) and Mary Matalin (addressing the right) and their promotion from within of former baggage handler Dave George to being annointed "the Flyi Guy"--the airline's resident comedian. This wisecracker's prerecorded announcements (in lieu of elevator music) spiced up even the experience of being on hold with Flyi via such lines as "I wanted to call our membership program 'The Mile I Club'-- but I was voted down."

In the Summer of 2005, the airline offered the GLiDE Summer Travel Pass for college students. Upon paying $250, the customer would be able to fly at no cost (After paying Taxes & Airport fees) from May 1-Aug 31, on Tuesdays, Wednesdays & Saturdays. This move was meant not to bring in revenue, but to try and fill seats that otherwise would have flown empty.

After facing financial hardships of the airline industry, Independence Air announced on January 2, 2006 that it would cease operations at 7:26pm UTC-5 on January 5, 2006.

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Financial Difficulties & Cessation of Operations

After its emergence as an independent brand name, Independence Air became known for offering very low airfares: as little as $29 one-way to Florida from Washington Dulles International Airport. However, the company never overcame a series of financial problems during its transition. In February 2005, one of its aircraft was repossessed after the company missed a lease payment. Later that year, three more aircraft were sold or repossesed.

In the first quarter of 2005, Independence Air lost $105 million on revenue of $91 million. A J.P. Morgan analyst released a report in early May 2005 predicting that Independence Air would lose $183.2 million in 2005, and have less than $5 million cash on hand by the end of the year. The report forecast that United Airlines, AirTran Airways, and other East Coast carriers would stand to gain the most should Independence Air cease operations.

Throughout 2005, Independence Air planned to emerge from deficits through fleet changes and workforce layoffs. At its inception, Independence Air's small Canadair Regional Jets cost the company $0.22 per seat-mile to operate. Low-cost carriers with larger aircraft were able to operate at much lower costs: $0.065 for JetBlue (with Airbus A320s) and $0.075 for Southwest Airlines (with Boeing 737s). In an effort to lower its costs to a competitive level, Independence Air began taking deliveries of new Airbus A319 aircraft that were expected to reduce operating costs toward JetBlue and Southwest's levels. The airline was never able to rebound.

  • On November 7, 2005, FLYi, Inc., the parent company of Independence Air, and its subsidiaries filed for Chapter 11 bankruptcy protection as stated in this press release. This filing had been long predicted by many industry analysts. In the filing, the company announced it would request court approval to engage in a formal court-supervised auction process to seek outside investor(s) or purchaser(s) it needed to continue its operations. If the process had been successful, it would have been expected to be concluded within sixty days.
  • On December 15, it was announced that service from Washington Dulles to Chicago IL, Jacksonville FL, Buffalo NY, and Manchester NH would be eliminated as of January 4, 2006. If the airline had not ceased operations the following day, the move would have reduced its workforce by about 50 to 2,700 employees, down from more than 5,000 when the airline launched. It also would have reduced daily flights to 170, serving 33 cities. Last spring, Independence served 47 cities.
  • On December 19, USA Today reported that for the second time in three years, Phoenix-based Mesa Air Group is bidding to acquire Independence Air.
  • On December 23, Jeff Rodgers, Vice President of Employee Services at Independence Air parent FLYi, Inc. sent notices to their union employees stating that the airline could possibly cease all operations and separate all employees at all locations sometime between January 7, 2006 and January 21, 2006. An image of that notice is available here.
  • On March 10, 2006, Northwest Airlines announced that it would purchase Independence Air's operating certificates for $2 million. It is expected that Northwest will use the certificate to form a subsidiary, dubbed Compass Airlines . NewCo is intended to operate Embraer 195s, which would replace Northwest's existing DC-9s.

At the time of its shutdown, the airline operated 200 daily departures to 37 destinations.

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Destinations

At the time of its shutdown on January 5, 2006, Independence operated services to 37 destinations:

Destinations eliminated prior to January, 2006 shutdown:

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Fleet

At the time of its shutdown on January 5, 2006, the Independence Air fleet consisted of the following aircraft:

Prior to its demise, the company had negotiated with Bombardier for delivery of multiple 90-seat Bombardier CRJ-900s.

28 Airbus A319s with International Aero Engines V2500 engines were scheduled for delivery in 2004-2006 [2]. The first of these arrived at Dulles on September 9, 2004 to commence proving runs and started scheduled operations on November 22, 2004 [3].

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External links

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References


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