Terror alert boosts all-frills airlines business

updated 4:47 p.m. ET Aug. 18, 2006

LONDON - The airborne terror alert that crippled Britain’s major airports has proved to be an unexpected boon for all-frills airlines and charter services shuttling from Britain to the United States and Europe.

While budget and mainstream airlines counted their losses and pondered who to sue for the loss of business Friday, high-end and charter carriers tallied up the number of new customers since the alert on Aug. 10.

“When the bigger system is under stress and is breaking down, we are continuing to deliver,” said David Spurlock, the founder of Eos Airlines, a business-class only trans-Atlantic carrier.

Business travelers in particular have been attracted to luxury carriers that fly out of smaller British airports — avoiding long security lines at the major terminals — and that offer planes with onboard services that many mainstream airlines cannot rival.

New airlines running the premium service London-New York shuttle at a discounted price believe they can capitalize on the current increased interest and win long-term customers.

Eos Airlines, which began operating once-daily flights between London’s Stansted Airport and New York’s John F. Kennedy Airport in mid-October, reported a 32 percent increase in bookings for next week.

MAXjet Airways, which began a rival service on the same route also last year, said it has seen a 30 percent rise in average weekly ticket sales over the past five days.

“There are a lot of people switching, people are obviously feeling more comfortable to fly on a private jet than on a commercial carrier,” said Spurlock, formerly a director of strategy at British Airways.

The trans-Atlantic route was the target of an alleged plot to blow up as many as 10 aircraft with liquid explosives that was revealed by the government on Aug. 10, sparking tough new security regulations that banned all hand luggage and increased passenger searches.

British Airways PLC, Virgin Atlantic, Continental Airlines and other major carriers canceled hundreds of flights following the alert and airports are still struggling to get back to normal operations.

Legal action
Budget airline Ryanair Holdings PLC threatened Friday to take legal action against the government if it does not improve matters at airports, while British Airways has already raised the possibility of suing the British Airports Authority for compensation.

In contrast, Spurlock said Eos canceled no flights and operated with an average delay of just 15 minutes during the crisis. Airlines like Eos and MAXjet have the advantage of using separate private jet terminals at the airport.

The security level has since been eased and passengers are now allowed to take a small amount of hand luggage, but several liquid items are still banned.

Eos Airlines is providing its passengers with several items they can no longer carry onboard, including saline solution and contact lens holders. It is also currently offering an escort service that greets each arriving passenger at the airport to assist with any necessary baggage repacking, and to escort the guest individually through check-in and fast-track security procedures.

Unlike the standard Boeing 757s, Eos’ jets are fitted with just 48 seats on a plane that typically carries 180. MAXjet puts around 102 seats on a plane that typically carries more than 200, with the same legroom as standard business class on American and Continental Airlines.

MAXjet CEO Gary Rogliano said that the airline’s passengers benefited from a fast track security checkpoint at Stansted, “which significantly reduces waiting times.”

And while flexibility is not always on offer — Eos and MAXjet have limited flight schedules — they do have a cost advantage. Eos, for example, offers flexible round-trip fares for $5,200, compared to the $7,900 flexible business class fare or $12,600 flexible first class fare available on BA’s website.

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