KEY POINTS:
When MAXjet filed for bankruptcy this week, few were surprised.
Indeed, as soon as the business class-only airline took to the skies two years ago, analysts began predicting the demise of it or of one of its direct competitors, SilverJet, or the more high-end Eos Airlines.
Now that MAXjet's fleet of five 767s has been grounded, the question has turned to whether it will be just the first of other crash landings of these upstarts.
The passenger segment they are targeting is where heavyweights British Airways and Virgin Atlantic make most of their profits and is the subject of fierce competition.
The environment is set to become even more difficult when the "open skies" agreement that opens the route to other carriers comes into effect.
With the rising cost of jet fuel and worries about a drop in spending by corporate customers amid the deepening credit crunch, there is a sense MAXjet won't be the last to hit turbulence. "The big carriers are making the bulk of their profits on North Atlantic premium traffic, and they don't like that being attacked. If they decide to crush you, there is not much stopping them. They just lower their fares," an industry analyst said.
Yet no sooner had MAXjet announced its demise than its rivals rushed out statements to assure the market that things were going well. SilverJet said its passenger numbers "continue to exceed expectations and forward bookings remain strong".
SilverJet and Eos offer beds and faster check-in for what is still as little as a third of the price of similar offerings from the larger carriers.
Eos, which only operates between New York and London, is aiming for the cream of the market, pampering passengers with cashmere blankets and Taittinger champagne.
Yet size is a problem. Silverjet has a fleet of three 767s, while Eos operates four 757s, meaning services are less frequent and more vulnerable to mechanical failures.
- Independent
