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It has definitely been a tough week for airlines, and yesterday Skybus became the third airline to stop operating.
Once again, the main culprits are rising fuel costs and the slowing economy, making it almost impossible for small, low-cost airline companies to compete in the current market. Skybus decided that it would be shutting down all operations as of yesterday, and plans to file for bankruptcy over the course of the next week.
Skybus has not been around for too long. The company started up about a year ago and operated around 75 flights a day. The company had 350 employees working out of Columbus, Ohio, and 100 in Greensboro, N.C.
Similar to what we saw earlier this week with the ATA Airline closure, the writing had been on the wall for a while now at Skybus. A couple of weeks ago, the company's CEO stepped down in order to pursue a book-writing career, and over the course of the past weeks the airline had already begun to cancel flights and destinations in reaction to rapidly rising fuel costs.
In addition to Skybus and ATA Airline shutting down and planning to file for bankruptcy, earlier in the week we also go that the news that Aloha Airlines had been forced to ground all of its flights.
Skybus announced on its official website that anyone holding Skybus tickets for future flights should contact their credit card companies as soon as possible to work out a refund, and to look for alternative flights to handle their travel needs.
I would like to say that this is not a trend that we should expect to see continue, but with oil prices still trading at near record highs you really have to wonder how many more stories like this we are going to be hearing over the upcoming weeks and months.
Michael Fowlkes has worked as a stock trader for seven years and spent the last four years working as an analyst for the online investment advisory service Investor's Observer.
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Reader Comments (Page 1 of 1)
4-06-2008 @ 4:27PM
Bob said...
But yet the Oil industry giants recorded BILLIONS in PROFITS! Figure that out.
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