One major airline, ExpressJet Airlines, is facing bankruptcy due to a combination of economic challenges.
ExpressJet Airlines, formerly known as Delta Connection and United Express, has suspended its operations since the past week. According to the company’s website, the carrier filed for Chapter 11 bankruptcy on Monday in Delaware. The companies stated that various economic and marketing issues have led to the carrier’s closure.
Unfortunately, economic dysfunctions have plagued many significant carriers worldwide, and ExpressJet may be the first of many airlines that decide to cease operations, media reports said.
Though ExpressJet Airlines isn’t the most popular airline, it had more than 450 aircraft on its roster at its peak. The airline was the largest operator of the Embraer ERJ145 aircraft, a 50-seat regional jet with turbofan power and exceptional range. The Embraer is made in Brazil and is quite popular with all low cost airlines in the world.
Though it operated this notable jet, the pandemic brought forth new issues for the carrier and its patrons. After United Airlines took over the company in 2018, it decided to end its usage of ExpressJet aircraft due to pandemic budget cuts. This set back the company tremendously, unable to have its jets leased out or utilised to keep up its revenue, the reports said.
Though ExpressJet Airlines was apparently down and out during the pandemic, the company launched a rebranding exercise in its last ditch effort to save the airline from going bust. The rebrand was called Aha! Airlines, which transformed the regional carrier into a low-budget jet-flying experience.
The reinvigorated airline had been running out of the Reno-Tahoe International Airport for the past six months. The jets could fly to 11 different cities in the western United States, but this downsizing didn’t save the company from its inevitable decline. The rising costs due to inflation and gas hikes dampened ExpressJet’s overall revenue, leaving the company no choice but to file for bankruptcy.
Just a month ago, Aha! Head honcho Tim Sieber expressed his excitement for the carrier’s growth. Sieber said in a press release that the airline was one of the “fastest-growing” regional airlines in the western United States. After exclaiming emphatically about the carrier’s expansion, it was a surprise that Aha! Would stop operations so prematurely.
The ExpressJet Airlines CEO, who owned Aha, made the following statement acknowledging pandemic and inflation issues as the reason for the recent “termination of operations”.
It was recently revealed that July 2022 was a relatively successful financial month for Aha And ExpressJet Airlines, which aligns with Sieber’s positive press release. In July, the carrier had a near-perfect flight record, with a 95.6 per cent on-time arrival rate and no cancellations. Though this information is imperative for maintaining an airline, the company wasn’t generating self-sustaining revenues to offset the rising fuel costs.
Even with such a successful month this year, as most Americans were flying out to holiday destinations with Covid 19 situation easing, the airline couldn’t alleviate the financial burden of the current market, ultimately leading to the decision for a complete closure of the regional jet business.
–IANS