One on One with Jeff Erickson, CEO of PEOPLExpress Airlines

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  1. This month, ExpertFlyer talks with Jeff Erickson, CEO of PEOPLExpress Airlines. One-time president and CEO of Trans World Airlines (TWA) and Reno Air, Erickson talks to ExpertFlyer about his latest challenge in launching a new discount airline with a familiar name.

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    “We’re taking a fun, creative and innovative approach to air travel, dispelling the myth that low air fares have to mean low service or an impersonal experience.”

    Jeff Erickson, CEO of PEOPLExpress Airlines

    It’s been three months since you sold your first ticket to fly with PEOPLExpress (PEX). How are travelers reacting to the new PEX?

    People have been very receptive and supportive of our service from the beginning. We’re taking a fun, creative and innovative approach to air travel, dispelling the myth that low air fares have to mean low service or an impersonal experience. Every week more and more people are embracing our mission to restore the concepts of respect, value and excitement to the air travel experience. We’ve seen terrific support from all eight of our initial markets and we’re getting requests daily from many of our 34,000 Facebook fans requesting us to come to their market because many cities are underserved following airline consolidation or lack direct routes that are convenient for personal and business travel.

    How does another new airline hope to compete against all the industry consolidation. What’s PEX’s unique value proposition to customers and how will you turn a profit?

    We are taking advantage of industry consolidation, which has led to cities and routes being abandoned and some markets, like our base in Newport News, underutilized. There certainly is room for our niche business model. Our value proposition is to provide a low-cost, a la carte service model that enables customers to create a customized travel product reflecting their individual wishes and budgets. Customers can choose to fly at an ultra-low price with friendly and attentive service but minimal frills or they can opt to purchase extras they want to make their trip more enjoyable, such as priority boarding, pre-assigned seating or an upgrade to a Living Large™ seat with more personal space. While this is common in the industry, our difference is the level of service we provide and can-do attitude from check-in to arrival. It’s service and level of personal attention that makes a difference. People want to be treated with respect and know that they are heard. The team members we’re hiring for all customer contact positions are creative problem-solvers who are empowered to find solutions. That’s the PEOPLExpress difference. In terms of profit, the a la carte model, along with affordable base fares, provides the mix of revenues we need to succeed.

    What’s been the biggest challenge and surprise during this initial launch phase?

    We are growing slowly and smartly with a focus on operational excellence. What we didn’t want to do is over-extend ourselves with an initial fleet of just two aircraft. Having said that, there are days when aircraft just don’t get where they need to be on time. In those cases we go out of the way to make sure our passengers are taken care of. What’s pleasantly surprising is how well received our service and brand have been in the marketplace.

    The original PEOPLExpress was famous for its low-cost, pay-for-it-all brand in the 1980s. What are some of the similarities, as well as key differences between the old and new PEOPLExpress?

    Air travel had become an unpleasant, difficult and costly experience for many travelers and in response to that need the new PEOPLExpress was born with a name that left an indelible mark on aviation history. Just as the original carrier introduced an innovative low-cost model, our mandate is to make air travel more accessible and enjoyable again. There are many similarities of the new PEX to the iconic brand but there are also differences given today’s different marketplace. We have adopted the a la carte model that the original carrier introduced and we have hired energetic and engaged teams to make it the best possible experience for our customers, just as it was in the ‘80s. But while the original carrier grew into a large hub operation at Newark, we’re taking a more measured approach, strategically connecting cities with no or little non-stop connectivity.

    Currently PEX is “Wet leasing” aircraft from Vision Airlines, which looks somewhat like you’re a travel agent selling seats on one airline. How quickly can PEX gravitate to a more traditional airline operating environment?

    At some point in the future, we anticipate that PEOPLExpress will be certificated as an independent airline. That is something we’re pursuing. In the meantime, Vision Airlines, dba PEOPLExpress, will operate this service with their in-flight crews.

    What would you say is your true niche (business, leisure travel)?

    We are seeing a mix of business and leisure traffic. Our schedule to most cities leans toward the leisure market, especially to Florida. But with daily service to Boston and twice-daily serving Newark, we’ve created new opportunities for business travelers to save considerable money compared to the over-priced walk-up fares they’ve been forced to pay as airline competition diminishes.

    Your brand tagline, It’s time to Fly Smart!™, what does that mean for travelers?

    It means not paying ridiculous walk-up fares for the convenience of non-stop service. It means being able to choose to pay for what you need for your own unique travel experience. It means choosing a brand that is fun, creative and innovative.

    You’ve already ramped up from your initial three routes to Newark, Boston and Pittsburgh, later adding West Palm Beach, Atlanta, New Orleans and St. Pete-Clearwater. What’s next?

    We just announced the start of service to Orlando International Airport from both Newport News and Charleston, WV beginning Oct. 16th. Beyond that we will continue to look for opportunities to connect under-served markets or those with little or no existing non-stop service.

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