Caught between high fuel costs, tight credit

The latest casualty in the increasingly troubled airline industry is Eos Airlines, operator of all-premium-class service between New York JFK and London Stansted. Eos announced late on Saturday (April 26) that it filed for Chapter 11 bankruptcy in New York and stopped flight operations. The carrier was caught between skyrocketing fuel prices and the financial industry’s credit crunch. Just a week before its bankruptcy filing, Eos announced that it had agreed to a “term sheet” setting the conditions for the company to secure $50 million in new financing from an existing Eos investor. But in the course of finalizing that financing, “some issues arose that we could not overcome,” said CEO Jack Williams, and the deal fell through, leaving Eos without enough money to keep operating. Eos had operated 757s configured for 48 passengers. It had been planning to expand operations in 2008 by adding Newark-London Stansted flights in May, London-Dubai service in July and JFK-Paris in the fall. For more information, go to www.eosclass.com. The closing of Eos leaves Silverjet as the only all-premium-class airline operating between U.S. and U.K.; it flies between Newark and London’s Luton Airport. L’Avion, another all-business-class carrier, flies between Newark and Paris-Orly. L’Avion last week reported that it achieved a March load factor of 78 percent and a first quarter load factor of 71 percent, which it said exceeded its projections. Another all-business-class airline in the New York-London market, MaxJet, stopped flying in December and filed for bankruptcy. MaxJet’s assets have been acquired NCA Sports Group and it will resume operations as a charter airline for professional and college sports teams, according to MaxJet’s web site.