PEOPLExpress staff members spent Veterans Day removing their computers, signs and other equipment from the Newport News-Williamsburg International Airport’s terminal after receiving an order to vacate the building.
The airline owes the airport about $100,000 in fees already collected from passengers. Notice was sent in early October to pay or leave the terminal, and since that payment has not been made, the airline is moving out, said Ken Spirito, the airport’s executive director.
The airline will be allowed to move back in if it pays the backlogged fees.
Airline officials announced Sept. 26 they were suspending operations because their two planes were no longer operational: One was sidelined by maintenance and the other was damaged after it was struck by a vehicle on the tarmac. The upstart airline, which began service June 30, has not flown since the suspension began Sept. 29.
Oct. 16 was initially offered as a date to resume service, however the airline’s president, Jeff Erickson, issued a statement Oct. 9 saying that date would not be met. He was unable to offer a timetable for when service would resume.
The airline faces another impending deadline of Nov. 24 to pay the September and October operating expenses owed for the use of office space elsewhere at the airport. If that payment is not received, Spirito said he will ask the airline’s administrative offices to vacate.
PEOPLExpress declined to comment for this story.
Spirito said the Peninsula Airport Commission, which oversees the operation of the airport, has met with its attorney about the matter. No legal action has been taken. He declined to say if the commission is considering future legal action against PEOPLExpress.
The airline released this map in May showing the cities it will serve. Orlando was slated to be added as a destination by Oct. 16. (Photo Courtesy PEOPLExpress)
In the Oct. 9 statement, Erickson said the airline was working to receive permission from the U.S. Department of Transportation to operate as an indirect air carrier, which would allow it to use planes from multiple airlines to carry passengers.
PEOPLExpress does not have a license to operate as an air carrier in the U.S., which forced it to rely on Nevada-based Vision Airlines to operate its flights during the three months it offered service.
The airline has received $650,000 from the airport commission to help pay for start-up costs. The U.S. Department of Transportation has reimbursed the commission $581,000 from a $950,000 grant it awarded to the airport to expand service from the airport, and Spirito said the application for reimbursement for the remaining $69,000 in funds paid out to the airline will soon be filed.
In October, Peninsula Airport Commission Chairman James Bourey said the commission was considering its options, including potentially taking back that grant funding. He said Tuesday the commission has yet to make any decisions about its next move.
The grant funding was contingent upon the airline providing service from Newport News to the New York and Boston markets. Along with those destinations, PEOPLExpress also flew to Atlanta, New Orleans, Pittsburgh and St. Petersburg and West Palm Beach in Florida. Service was slated to start to Orlando on Oct. 16.
PEOPLExpress relaunched with a focus on low-cost, nonstop airfares. When the airline launched, seats were priced at $76 and up, with fees charged for extras like exit row seats, advanced seat assignments and overhead bins.
The service provided by PEOPLExpress was a boon to the airport’s traffic, Bourey said in October. In August, the airport served 62,735 passengers, compared to the 49,460 passengers served in August 2013, a 27 percent climb. Ridership was also up 25 percent in July and 42 percent in September.
Jessica Wharton, the airport’s director of marketing and public affairs, said in October the boost in ridership is attributable to PEOPLExpress.
“It proves the case that there is a market on the Peninsula for a low-fare air service to key business and leisure destinations that have been abandoned [by other carriers],” Wharton said in October. “I think PEOPLExpress has been able to show that market is still here and is alive and well. When we have that service, people buy it.”
The airport lost more than 40 percent of its annual traffic — dipping from more than 1 million passengers in 2011 to about 650,000 in 2012 — after AirTran left in March 2012.
The promise of a new airline to help fill in AirTran’s void was met with optimism by local and state officials. Gov. Terry McAuliffe attended a launch celebration for the airline in May, when the destinations and the June 30 start of service were announced.
“We are going to unlock this region,” McAuliffe said at the time. “Working together, we are going to take Hampton Roads to a level never seen before.”
Before the suspension of service, PEOPLExpress served 55,000 passengers on 817 flights. But as soon as service stopped, customers took to the airline’s Facebook page to express frustration with cancellations and what they said was the difficulty of obtaining refunds. The airline promised full refunds to all those affected by the shutdown.
Related Coverage:
- No Timetable for PEOPLExpress to Resume Service from Newport News
- PEOPLExpress Scrambles to Restart Service to Keep Federal Grant Money
- PEOPLExpress Suspends All Service Until At Least Mid-October
- Upstart Newport News-Based Airline PEOPLExpress to Offer Service to Orlando
- Upstart Airline PEOPLExpress Service Begins in Newport News
- PEOPLExpress Starts Service June 30 from Newport News to Northeast Cities
- PEOPLExpress Hires CEO, Sets Sights on 2014 Start of Service
- PEOPLExpress Gets Help from Investment Advisory Firm
- PEOPLExpress Acquires Idaho-Based Airline
- PEOPLExpress: Purchase Agreement in Place to Acquire Existing Airline
- PEOPLExpress Secures Loan to Explore Acquiring Airline