June 11, 2014 | Kendall Creighton Virtual Reality Tuesday, June 10, 2014 Watch your back, Spirit. The infamous PEOPLExpress brand is returning to the US market. Tickets and schedules went live on its website, flypex.com, June 4th and its press release says that base fares will start at “as low as” $76 each way. Flights will launch on June 30. However this airline will operate as a “virtual carrier”. What does that mean for passengers? PEOPLExpress will only be a ticket seller. Someone else will be responsible for what happens in the sky. They will act like an airline except PEOPLExpress will not have its own air operator certificate and will outsource all of the actual flights to a third-party carrier that then operates the flights under their own air operator certificate. There is a fine line between a tour operator and a virtual carrier. This is just one of many different arrangements all designed to do the same thing. By creating a daunting web of businesses, the airline is trying to collect profits and avoid any liabilities. In previous editions of our newsletter, we have written about Manx2, the British-based, low-cost virtual airline. When one of its planes crashed, killing the pilots and four others, Manx2 said it wasn’t an airline after all. It was merely a ticket seller. So, despite its planes painted with the distinctive green logo, its banners advertising PEOPLExpress at Newport Airport, and the flight attendants “welcoming you aboard this PEOPLExpress flight”, the airline has outsourced as many possible operational and business functions as it can. Smoke & Mirrors Accountability and Chain of Command PEOPLExpress will lease all its planes from Vision Airlines, an aircraft leasing and charter company which is also providing the pilots and flight crews. Vision Airlines has had a rocky road. Last year, this “airline” was formally charged by the state of Florida with grand theft. The State Attorney General’s office contended that the airline owed more than $146,000 in upaid “passenger facility charges” that were collected from passengers, but never paid during the carrier’s recent and ill-fated attempt to create a hub at the Northwest Florida Regional Airport. Vision Airlines also has a long list of pending legal actions being taken against them for not paying their bills. Prior to deciding to lease its entire fleet, PEOPLExpress had planned to acquire Xtra Airways and Ryan International airlines. Both deals fell through when the DOT denied the sale to proceed. In 2012 the DOT sent a cease-and-desist order to PEOPLExpress for soliciting memberships for its frequent flyer club “Club Travelati” before it had a certificate to fly. The airline paid a $10,000 fine. PEOPLExpress CEO and founder, Michael Morisi, resigned in December 2013. He was part of the first incarnation of the airlines in the 1980s along withHarold Pareti, who co-founded the original airlines. Pareti is now the president of Global Airline Services of Florida, which brokers charter plane flights. In 2011, the DOT fined Pareti $120,000 for selling flights to the public with no authority from the DOT. PEOPLExpress’ new CEO is Jeffrey Erickson, formerly of Atlas Air. In 2010, Atlas Air was fined $572,150 by the DOT for improper maintenance practices. Base of Operations The airline is leasing 16,000 square feet of office space in the Newport News Airport’s old terminal for its corporate headquarters. The airport is waiving landing fees and giving the airline free counter rental for a year, said Ken Spirito, executive director of the Newport News airport. Spirito said the airport waived a $5.25 per square foot leasing rate for one year – an approximately $84,000 savings for the airline. After the first year, the standard rate increases annually by about 2 percent, Spirito said. Virtual Airlines Can’t Outsource Safety When you buy a ticket on a major, established carrier, you do it with the belief that said carrier will do its utmost to fly you safely. It is not only in their greatest interest to do so, but also easier as they control every aspect of the operation. A ‘virtual’ airline will sell you an image, like Manx2 did, leading the customer into believing they were involved in the actual operation of the airline, which they were not. The story is not all that different from the 2009 Colgan crash in Buffalo. People boarded that aircraft holding a Continental ticket, seeing the Continental globe on the tail of their plane and expecting the same safety level as Continental. But after the crash it was made clear their aircraft was flown by Colgan Airlines, who underpaid and undertrained their tired pilots. It’s pretty certain that many passengers would not buy tickets from virtual airlines if they knew about their structure. It’s a misleading business model where frontline companies are taking the customers’ money but hedging all responsibilities to third parties which the client is unaware of. That’s fair enough when you’re buying a phone or internet contract, but in the case of an airline, the product is safety itself. Who’s Flying the Plane? This is going to be a long summer. Last month, a pilot for a Delta Connection flight failed to show up at JFK, leaving all the passengers in a lurch. Given the crew shortages at regionals, we’re going to see more of this, at least until the regionals can afford to pay more and attract more pilots. FlyersRights has written about poor pilot pay and the fact there are plenty of pilots qualified to do the job -but a shortage of qualified pilots willing to work for the low pay and work rules at most of the regionals. Of course, Delta compounded the problem by delaying assistance to its passengers more than 24 hours. The airline has plenty of humans on the payroll to help, including at JFK. Anytime passengers are delayed more than eight daytime hours, without weather, is an emergency. For all of this, Delta couldn’t manage anything other than a $100 gift card. What this sounds like is the airline scheduling crews in such a way that if there are delays or canceled flights, the airline just accepts the associated costs rather than hire too many pilots to have on reserve in case crews time out. This is obviously a financial move, not a marketing one. What’s odd is that we never hear of this issue happening in Europe. A Word From Our President Cleveland Hopkins International Airport, which recently lost its United hub status, now has a new way to delay and inconvenience passengers. Its monopoly shuttle to its car rental center now features a shuttle to a shuttle, because Dollar, Thifty and other auto rental car companies pulled out of its high-delay, high-fee car rental center, and the airport bars rental car courtesy vans. Way to go Cleveland! Now pioneering the shuttle to a shuttle, driving away more passengers. And another plus for no-shuttle, Akron-Canton airport. Flyersrights.org urges all airports to include passenger representatives on their governing boards. Without that, the conventional bone-headed airport management strategies of squeezing passengers with ever more delays and expenses will continue. Paul Hudson president FlyersRights.org Job Postings of the Week! Hot from the DOT: The Office of Aviation Enforcement and Proceedings, Office of the General Counsel, U.S. Department of Transportation is seeking exceptional candidates to fill two attorney positions at DOT Headquarters. Through negotiated cease and desist orders with civil penalties or through administrative hearings, attorneys in the office enforce Federal aviation statutes and rules protecting the civil rights and economic interests of air travel consumers. Successful candidates will be hired in the GS-11 through GS-13 range depending on experience. See attached vacancy announcement for more information. If interested, by Monday, June 16, 2014, please submit your resume to C70aviationenfc@dot.gov or by mail to the following address: Office of Aviation Enforcement and Proceedings (C-70) Office of the General Counsel U.S. Department of Transportation Attn: Ms. Wilma Glover 1200 New Jersey Ave., SE 20590, W96-429 For more information, please call at 202-366-9342. Applicants are encouraged to also apply through USAJobs at the link below: https://www.usajobs.gov/GetJob/ViewDetails/371230100 Hot from FlyersRights: Wanted IT/social media coordinator PT 10+ hours per week. Send resume and cover letter by June 20 to firstname.lastname@example.org. Also, we need volunteers who are willing to contact members of Congress in support of the FlyersRights Airline Passengers Bill of Rights! Please contact us by email or phone. Critical time for introduction of legislaton is approaching. 800-662-1859, Paul@flyersrights.org Video of the Week! We’ve lost a lot over the years… North Central Airlines Promo Film – 1972 —————————————————————– FlyersRights depends on tax-deductible contributions from those who share our commitment to airline passenger rights. Thank you. or FlyersRights 4411 Bee Ridge Road Sarasota, FL 34233 We value your thoughts and opinions! Please send to Kendallc@FlyersRights.org.