Aviation has a way of attracting enthusiastic followers for
particular aircraft and airlines, but the task being undertaken
by one team may be the biggest show of airline loyalty ever. A
group of airline managers is looking to get Eastern Air Lines
flying once again. Looking at their progress so far, this
relaunched carrier could be taking to the skies in the next few
A brief history of Eastern
Eastern Air Lines also notes that it was the first airline to
operate the Boeing 727 and Boeing 757, as well as being the first
U.S.-based airline customer for
. At its peak, Eastern could easily be considered one of the
largest airlines in the U.S. The original Eastern Air Lines was
born out of a small aviation company started in 1927, around the
same time as the other mainline carriers flying today. Like many
other early airlines, Eastern made a good business of flying mail
in the 1930s, gradually moving toward passenger transport during
the next several years.
But the airline industry is often a turbulent one, and
financial troubles began to threaten Eastern Air Lines in the
1980s. Due to a combination of asset transfers, labor problems,
and debt issues, the airline eventually ceased operations in
1991, as the Gulf War began.
The new Eastern
When Eastern Air Lines stopped flying, the airline still had many
fans from both the airline and the aviation history it was a part
of. This group of people started the new version of Eastern Air
Lines in 2011, 20 years after the original Eastern ceased
The new company is called Eastern Air Lines Group. Although
many people know the company as Eastern Airlines, the words Air
and Lines are separate to reflect the original name of Eastern
Air Lines. Eastern will now join
Delta Air Lines
as one of the few modern airlines with this type of spelling.
Source: Eastern Air Lines
The new Eastern has moved its head offices to the old Eastern
operations center at Miami International Airport. Besides using
the historical operations center, the new Eastern plans to base
itself out of Miami for its flight operations.
Although Boeing has long since stopped production of the 727
and 757, the aerospace manufacturer has been tapped to supply the
new Eastern with up to 20 Boeing 737-800 aircraft; 10 are firm
orders, and 10 are purchase rights.
Routes and competition
Since the old Eastern Air Lines ceased operations, the airline
industry has undergone a period of consolidation that has seen
the number of competitors drastically shrink. However, the
airlines that remain are now both bigger and stronger than the
more fragmented carriers of decades past.
In Miami, Eastern will face competition from many airlines,
but especially from
American Airlines Group
, which uses Miami as one of its hubs. American Airlines Group is
now the world's largest airline since its merger with US Airways,
and will be offering a wide selection of routes servicing both
the U.S. and the markets of Central and South America.
Although Eastern has yet to announce its routes, the Miami
location is well positioned to operate flights to Central and
South America, as well as the east coast of the U.S. The airline
has already chosen "LatinOnePass" as the name for its frequent
flyer program, suggesting the airline may operate some flights to
The airline industry has seen a nice rebound since the recession,
propelled by both rising demand and industry consolidation. This
has led to record profits at American Airlines Group, Delta Air
, as the carriers benefit from disciplined capacity management
and higher travel demand.
Despite this improved industry outlook, the road ahead will
still be challenging for the new Eastern Air Lines. History is
littered with failed airline start-ups from its early beginnings
to the present day. However, Eastern Air Lines will have a level
of name recognition that most start-ups lack, which may help in
collecting media attention and attracting aviation fans.
For existing airlines, the start-up of Eastern is unlikely to
have a major impact, at least in the near term. With smaller
financial resources, Eastern is unlikely to wage price wars to
break into competitive markets, and its smaller fleet will put a
limit on how much capacity it can add to the aviation market as a
whole. Of all existing carriers, American Airlines would be the
most likely to feel pressure due to increased capacity at Miami
International; however, investors will have to wait for Eastern's
route plans to determine how many routes currently flown by
American will see increased capacity from Eastern.
Eastern Air Lines Group filed for its Certificate of Public
Convenience and Necessity in January of this year, and has since
placed an order for up to 20 Boeing 737-800 aircraft. As always,
building a successful airline will be a challenge; but the
founders of the new Eastern have chosen the right industry
environment to do it in.
If these people are successful, Eastern Air Lines may just
become the first legacy carrier to disappear for more than a
decade before returning to the skies.
How to get even more income during retirement
Social Security plays a key role in your financial security,
but it's not the only way to boost your retirement income. In
our brand-new free report, our retirement experts give their
insight on a
simple strategy to take advantage of a
little-known IRS rule
that can help ensure a more comfortable retirement for
you and your family.
to get your copy today.
America's Newest Airline Is a Very Old One
originally appeared on Fool.com.
owns shares of AMERICAN AIRLINES GROUP INC and Delta Air Lines,
and has the following options: long January 2015 $17 calls
on AMERICAN AIRLINES GROUP INC, long January 2015 $32 calls on
AMERICAN AIRLINES GROUP INC, long January 2015 $40 calls on
AMERICAN AIRLINES GROUP INC, long January 2015 $22 calls on Delta
Air Lines, long January 2015 $25 calls on Delta Air Lines, and
long January 2015 $30 calls on Delta Air Lines. The Motley Fool
has no position in any of the stocks mentioned. Try any of our
Foolish newsletter services
free for 30 days
. We Fools may not all hold the same opinions, but we all believe
considering a diverse range of insights
makes us better investors. The Motley Fool has a
Copyright © 1995 - 2014 The Motley Fool, LLC. All rights
reserved. The Motley Fool has a