Multifarious reasons for Skybus' Demise

What has led to the sudden demise of the Skybus Airlines is the biggest question of the day. It is true that the abrupt fall of this very airline from a high altitude to the crude reality followed by the closure of operations has sent a shudder through the spinal chord of the airlines industry in the US and has forced the still existing airlines to engage in self-analysis. Well, as far as the real reasons are concerned, though a lot of studies several of them are coming to the fore. One of them is the burgeoning fuel prices that alone is the biggest factor in Skybus' demise. However, there are also other prominent reasons, according to the industry experts, that are necessary to introspect.

Of them the first happens to be the saga of poor management and in this segment Skybus Chief Executive Bill Diffenderffer, who resigned recently is highly responsible. Although he was portrayed by the new media as a person of rare abilities and an innovative leader, to the estimation of some investors and board members he was much more concentrating to present himself before the camera instead of tackling the tough day-to-day task of running an airline and develop the overall proficiency of the management. It is his negligence that cost the company dearly. To them the sorry condition wouldn't have materialized had there been implementation of effective decisions within time. This thought has found best expression in the words of Charlie Clifton, Vice Chairman of Skybus, who said, "When we started flying, oil was at $62 a barrel. Now, it's $106. The West Coast routes worked, but not at those prices. We had to pull off them, which hurt our credibility. You need routes to mature, but you just don't have any room to maneuver at those costs."

Well, apart from the immediate financial issues there were also the brewing labor problems. The grievance of the pilots regarding working conditions, pay and a lack of communication with management started a new phase of workers' discontent. This persistent defiance cost the company dearly by posing a direct threat to Skybus' plan of keeping labor costs well below industry averages. Last but not the least, along with a weak economy and housing market for a pullback in consumer demand the loss of confidence in Skybus was a contributing factor.