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Aviation History
1983
1983 - 2147.PDF
PEOPLE EXPRESS Fast fare deal People Express keeps surprising the industry and the public with its achievements. It surprises itself as well. What kind of an organisation is it now? David Learmount flies to Newark to investigate. People Express is "re-inventing the wheel every five minutes". Clive Medland, former RAF Squadron Leader and VC10 captain, now a People Express flight manager and 737 captain, made that remark in response to a Flight observation that the airline had an "amateurish" feel about it. More later about that adjective "amateurish", which could be construed as damning, and about the "wheel". With People Express you get what you pay for. People has re-invented the mean ing of that cliche as well. What do passengers pay for, according to the more traditional airlines? Looking at their marketing strategy and their methods of competing you would say that they offer a total service package, and that they would rather compete in terms of image and cabin service than price. People just offers air transport, which means a safe seat from A to B at a simple profit-making price which will attract a large number of passengers. More is avail able if you want it, but you have to pay for it item by item. It certainly makes the frequent business traveller review what he wants when he flies. Having tried People Express he may decide never to do so again; or he may decide that "here he gets what he pays for". His decision would depend on many factors but one of the most fundamental would be his ego. Some commentators have called People "the McDonalds of the air". There's some truth in that, but it is unfairly simplistic. Providing safe hamburgers is not in the same league as providing safe air transport for about five million passengers a year—which People FLIGHT International, 26 November 1983 People Express' 490-seater Boeing 747 docks at London Gatwick will easily exceed by the end of 1983. Airline chairman Donald Burr is a furi ously busy man to whom all employees have uncommonly easy access. The world's Press, fascinated by People's success and its appealingly common touch, compete for his time also. Naturally aware of what the Press can do for his carrier, Burr gives them what time he can, but is bothered more than somewhat by particular misconceptions which the media regularly hand to their readers. The main one is that People is a small airline. To quote just one example, Time in February began an article by describing People as "One feisty little carrier ..." which it wasn't then, Burr says, and certainly isn't now. He handed Flight a copy of First Boston Corporate Finance's airline group equity monitor dated July 8, and it placed People tenth among the US giants for equity market value. It is now ninth. There are many ways of measuring an airline's "size". Last year People carried more than 2-8 million passengers, earned revenues of $138-7 million, and profits of over $10 million. Results for the nine months to the end of September this year show the carrier bringing in revenues of $198 million, operating profits of $16-33 million, and net profits of $9 • 1 million, having carried 3,950,323 passengers. The end-October figure shows 4-6 million passengers carried this year. People's current fleet comprises 17 737-100s, five 737-200s, 15 727-200s-with another 29 of them to come between today and March 1985, and its one transatlantic- route 747-200. It is misleading simply to list the types without pointing out what People has done to the seating capacity, 1431
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