Virtual airline (economics)

Last updated

In economics, a virtual airline is an airline that has outsourced as many possible operational and business functions as it can, but still maintains effective control of its core business. [1] Such an airline focuses on operating a network of air services, and outsourcing non-core activities to other organizations. [2] Contracting out services within the aviation industry has reportedly become so common that many carriers could be classed as having features of a virtual airline, although it is arguable whether any current carriers meet a strict definition of the term. [3] [4]

Contents

The term is often used to describe travel companies and ticket agencies that market themselves as airlines, but do not possess an air operator's certificate and contract with one or more certificated operators to fly and maintain aircraft, often under an air charter or wet lease arrangement. Although operated by others from a regulatory standpoint, the aircraft may display the virtual airline's livery, and may be owned or leased by that company.

Origins

Virtual airlines originated in the United States following the drastic changes brought about by the Airline Deregulation Act of 1978. During the hyper-competitive years immediately following deregulation, major airlines found it increasingly unprofitable to compete against start-up carriers on many routes they currently served. Instead of forfeiting the routes entirely, the larger carriers often made marketing arrangements with smaller airlines to fly under the "banner", or livery, of the larger airline. These regional airlines, mimicking the well known major airlines in adverts and purporting to make connections as seamless as possible, soon abandoned their own local service routes. In most cases, the regional airlines found it more profitable to serve the mainline hubs as a feeder operation rather than operate on their own.[ citation needed ]

A Dornier 228 with the livery of virtual airline Manx2; the aircraft was actually operated by FLM Aviation, with Manx2 being a ticket broker. Manx2plane.jpg
A Dornier 228 with the livery of virtual airline Manx2; the aircraft was actually operated by FLM Aviation, with Manx2 being a ticket broker.

List of virtual airlines

Africa

Europe

North America

With mainline-type equipment

With regional-type equipment

Related Research Articles

<span class="mw-page-title-main">Midwest Airlines</span> Defunct airline of the United States (1984–2010)

Midwest Airlines was a U.S. airline headquartered in Oak Creek, Wisconsin, that operated from Milwaukee Mitchell International Airport between 1984 and 2010. For a short time, it also operated as a brand of Republic Airways Holdings.

SkyWest Airlines is an American regional airline headquartered in St. George, Utah, United States. SkyWest operates and maintains aircraft used on flights that are scheduled, marketed and sold by four partner mainline airlines. The company is contracted by Alaska Airlines, American Airlines, Delta Air Lines, and United Airlines. In all, it is the largest regional airline in North America when measured by fleet size, number of passengers carried, and number of destinations served.

Envoy Air is an American regional airline headquartered in Irving, Texas, in the Dallas–Fort Worth metroplex. The airline is a wholly owned subsidiary of the American Airlines Group and it is paid by fellow group member American Airlines to staff, operate and maintain aircraft used on American Eagle flights that are scheduled, marketed and sold by American Airlines.

United Express is the brand name for the regional branch of United Airlines, under which five individually owned regional airlines operate short- and medium-haul feeder flights.

Continental Express was the operating brand name used by a number of independently owned regional airlines providing commuter airliner and regional jet feeder service under agreement with Continental Airlines. In 2012 at the time of Continental's merger with United Airlines, two carriers were operating using the Continental Express brand name:

US Airways was a major airline in the United States that operated from 1937 until 2015, when it merged with American Airlines. It was originally founded in Pittsburgh as a mail delivery airline called All American Aviation, which soon became a commercial passenger airline. In 1953, it was renamed Allegheny Airlines and operated under that name for a quarter-century. In October 1979, after the passage of the Airline Deregulation Act, Allegheny Airlines changed its name to USAir. A decade later it had acquired Piedmont Airlines and Pacific Southwest Airlines (PSA), and was one of the U.S.'s seven transcontinental legacy carriers. In 1997, it rebranded as US Airways.

Mesa Airlines, Inc., is an American regional airline based in Phoenix, Arizona. It is an FAA Part 121–certificated air carrier operating under air carrier certificate number MASA036A issued on June 29, 1979. It is a subsidiary of Mesa Air Group and operates flights as United Express via respective code sharing agreements with United Airlines. It serves more than 180 markets in the Western Hemisphere. In a 1997 article from the Journal of Air Transportation, Mesa's safety record was noted as having the fewest incidents among domestic regional airlines at that time. Mesa filed for Chapter 11 bankruptcy in January 2010, hoping to shed financial obligations for leases on airplanes it no longer needed and emerged from bankruptcy in March 2011. In November 2017, Mesa opened a new training center in Phoenix. The 23,000-square-foot facility features a full-size CRJ-200 cabin trainer aircraft, 14 classrooms, and has the capacity to train 300 crew members at one time.

<span class="mw-page-title-main">Regional airline</span> Classification of scheduled air carrier

A regional airline is a general classification of airline which typically operates scheduled passenger air service, using regional aircraft, between communities lacking sufficient demand or infrastructure to attract mainline flights. In North America, most regional airlines are classified as "fee-for-departure" carriers, operating their revenue flights as codeshare services contracted by one or more major airline partners. A number of regional airlines, particularly during the 1960s and 1970s, were classified as commuter airlines in the Official Airline Guide (OAG).

Republic Airways Inc. is an American regional airline headquartered in Indianapolis, Indiana, United States. Republic operates and maintains aircraft used on flights that are scheduled, marketed and sold by a partner mainline airline. The company is contracted by American Airlines, Delta Air Lines, and United Airlines.

MetroJet was a no-frills airline brand operated as a wholly owned division of US Airways from 1998 until 2001.

<span class="mw-page-title-main">Cheyenne Regional Airport</span> Airport in Cheyenne, Wyoming, USA

Cheyenne Regional Airport is a civil-military airport a mile north of downtown Cheyenne, in Laramie County, Wyoming. It is owned by the Cheyenne Regional Airport Board.

<span class="mw-page-title-main">Santa Fe Regional Airport</span> Airport

Santa Fe Regional Airport is a public use airport in Santa Fe, Santa Fe County, New Mexico, United States, 10 miles (16 km) southwest of the city center. The airport serves the greater Santa Fe and Los Alamos areas.

<span class="mw-page-title-main">Durango–La Plata County Airport</span> Airport in Durango, Colorado, USA

Durango–La Plata County Airport is a city- and county-owned public airport 12 miles southeast of Durango, in La Plata County, Colorado.

<span class="mw-page-title-main">AirTran JetConnect</span>

AirTran JetConnect was the brand for AirTran Airways former regional airline service, which flew regional jet aircraft from AirTran's hub in Atlanta. Service was to short-haul markets where AirTran felt their Boeing 717 or Airbus A320 mainline jet aircraft were too large to economically operate.

<span class="mw-page-title-main">Mainline (aeronautics)</span> Airline industry term

A mainline flight is a flight operated by an airline's main operating unit, rather than by regional alliances, regional code-shares, regional subsidiaries, or wholly owned subsidiaries offering low-cost operations. Mainline carriers typically operate between hub airports within their network and on international or long-haul services, using narrow-body and wide-body aircraft. This is in contrast to regional airlines, providing feeder services to hub airports operating smaller turboprop or regional jet aircraft, or low-cost carrier subsidiaries serving leisure markets.

<span class="mw-page-title-main">Chautauqua Airlines</span>

Chautauqua Airlines, Inc. was an American regional airline and a subsidiary of Republic Airways Holdings based in Indianapolis, Indiana, United States. Prior to the shut down of operations, it operated scheduled passenger services to 52 airports in the United States and Canada via code sharing agreements as the Delta Connection for Delta Air Lines, AmericanConnection for American Airlines, and United Express for United Airlines. Chautauqua previously flew feeder services for other airlines via code sharing agreements including Allegheny, USAir, TWA, Continental, Frontier, and America West. Its last day in operation was December 31, 2014, at which time all flying was absorbed by the Shuttle America certificate.

Delta Connection is a regional airline brand name for Delta Air Lines, under which a number of individually owned regional airlines primarily operate short- and medium-haul routes. Mainline major air carriers often use regional airlines to operate services via code sharing agreements in order to increase frequencies in addition to serving routes that would not sustain larger aircraft as well as for other competitive or operational reasons.

Midwest Express Airlines is a U.S.-based airline operating from Milwaukee Mitchell International Airport led by Greg Aretakis, aviation industry veteran and former VP at Midwest Airlines. On August 28, 2019, the company announced its initial plan of operations by announcing their initial set of routes. The airline had announced earlier in August 2019 an agreement with Elite Airways to provide the services under the branding, livery, customer service and reservations system provided by the Midwest Express operating company. It is intended as a successor to the Midwest Airlines that operated from 1984 to 2010, also headquartered in Milwaukee.

References

  1. ↑ Flouris, Triant (2006). Designing and Executing Strategy in Aviation Management. Ashgate Publishing. p. 91. ISBN   0-7546-3618-6.
  2. ↑ Doganis, Rigas (2005). The Airline Business. Routledge. p. 283. ISBN   0-415-34615-0.
  3. ↑ Ioannides, Dimitri (1998). The Economic Geography of the Tourist Industry: A Supply-side Analysis. Routledge. p. 118. ISBN   0-415-16411-7.
  4. ↑ Domberger, Simon (1998). The Contracting Organization: A Strategic Guide to Outsourcing . Oxford University Press. pp.  146. ISBN   0-19-877458-3. British Airways [has] lean[ed] towards becoming the first of the new general of Virtual Airlines
  5. ↑ Kulisch, Eric (20 July 2023). "Ocean carrier MSC adds 2nd cargo jet". FreightWaves.com. Retrieved 9 November 2023.
  6. ↑ "Republic Airways to operate large regional jets for American Airlines | Dallas-Fort Worth Airlines News - Business News for Dallas, Texas - The Dallas Morning News". Archived from the original on 2013-01-25.

Commons-logo.svg Media related to Virtual airlines (economics) at Wikimedia Commons


This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.