All-business-class airlines take off despite past failures

Like other business travelers, bluegrass music star Alison Krauss and her band were smitten by the charms of an all-business-class airline.

"The service and the food are amazing, and the seats are comfortable," says tour manager David Norman, who flew this month with the musicians on Silverjet from Newark to London for the start of a European tour with former Led Zeppelin lead singer Robert Plant. "There were only 100 seats, and Alison and others loved the women's-only bathroom."

Despite high ticket prices, an all-premium-class airline means the world to business travelers in an era of growing consumer dissatisfaction with many carriers. Frills and comfort such as individual video players, fresh food, fine wine, wide seats and lots of legroom can lead travelers to pony up thousands for a ticket (a round-trip flight on Silverjet between Newark and London next month starts at about $2,800).

But for decades, travelers have seen one all-business-class airline after another go belly up.

Last month, trans-Atlantic carrier Eos became the latest victim, ceasing flights after about 18 months of operation and filing for bankruptcy-court protection. In December, trans-Atlantic rival Maxjet stopped flying — 13 months after its first flight.

Silverjet suspended trading of its stock last week as it sought investment capital to keep it flying. No flights were canceled, and the airline expects to announce Thursday that it has received a major cash infusion, says spokesman Greg Maliczyszyn.

The financial difficulties have not signaled the end of all-premium-class airlines. In addition to England's Silverjet, France's L'Avion flies into the USA. Primaris Airlines expects to begin scheduled "professional-class" flights from New York to three cities next year.

Big airlines are also becoming more enamored with all-premium-class service. Four European airlines — Lufthansa, Swiss, KLM and Air France— are offering some all-business-class flights to the USA. The flights are operated by PrivatAir, based in Geneva.

Two weeks ago, Singapore Airlines launched the first all-business-class flights between North America and Asia. Next month, British Airways subsidiary OpenSkies plans to start New York-Paris flights with a Boeing 757 jet configured with more than 60% of the seats for business-class fliers.

Many aviation experts say that it may work for airlines to offer all-premium service on some routes, but that the idea of making money with all-business or all-first-class service is ridiculous. They point to the premium-class graveyard where the tombstones are reminders of such short-lived U.S. airlines as Air One, Air Atlanta, McClain, Regent, MGM Grand and Legend.

"Nobody learns from previous mistakes," says Barbara Beyer, president of Avmark, an airline consultant in Vienna, Va. She says many all-business-class carriers that failed were undercapitalized, and none were close to success.

All-business-class airlines, aviation historian Ronald Davies says, are often started by rich businessmen who "think there are "millions of other rich people who want to fly on a really specialized airline."

The rich businessmen only heed market research that agrees "with their hunch" and ignore research that shows there aren't enough passengers to regularly fill their planes, says Davies, the curator of air transport at the Smithsonian's National Air and Space Museum.

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