In a blow to the boutique airline concept, British Airways said it is shutting down its ten-year-old subsidiary, Open Skies, which currently flies between New York and Paris.
Instead, BA parent company IAG, which also owns Aer Lingus and Iberia, will use the Open Skies airport gates and other assets at Paris’ Orly to expand service by its new budget offshoot, Level, which already flies from Barcelona to the U.S. West Coast, as well as to several destinations in Latin America.
In a statement, IAG CEO Willie Walsh played up the benefits of Level taking over the Open Skies presence, saying that the new unit “will benefit from the local experience and knowledge of the Open Skies team.”
As of September, 2018, the Open Skies brand will cease to exist, and all of its staff will be transferred to Level to create its second hub after Barcelona. As a result, Level will launch new flights from Paris to Newark, Montreal and Martinique and Guadeloupe starting next summer.
BA had launched Open Skies with great fanfare in 2008 amid high hopes. As suggested by its name, the idea was to capitalize on rights granted under the “open skies” treaty with the EU, allowing European carriers to fly to any point in the U.S. from any point on the continent, thus freeing them from the traditional limitations of only being able to operate directly from their home countries to the states.
Open Skies’ other selling point was that it offered an attractively priced premium product, with a business class and premium economy, along with a small economy section, on aboard a narrowbody 757 configured with reclining leather seats. And it opened a dedicated lounge at Paris’ Orly that won praise from frequent fliers. Also around that time, it acquired the assets of L’Avion, a French all-business class airline – whose founder went on to form La Compagnie, a French-based boutique premium line that has won a loyal following in the same market.
But Open Skies hit some speed bumps in the aftermath of the 2008 financial meltdown, and it pivoted several times, expanding to and then dropping cities on its route map, such as Washington, D.C. and Amsterdam, and beefing up its coach cabin while reducing the premium seating. In the last few years, it has only offered flights between New York JFK and Newark to Paris, operating with a fleet of three aging 757s, along with one 767.
Judging from the muted response to the news, Open Skies may not be missed by many travelers. And travel insiders also remarked that the carrier was a bit of an enigma.
“They didn’t have a clear image, and I don’t recall them ever reaching out to us,” said Rick Ardis, owner of Ardis Travel, East Rutherford, N.J.
“It’s a very niche carrier, and not well known, and for our agency and our leisure business, the fact they only served one destination in Europe didn’t help you much.
“The market for their flights was just much too small to attract business,” he said.
Henry Harteveldt, a travel industry analyst with Atmosphere Research in San Francisco, said that while the niche airline concept isn’t completely dead, “it’s very difficult for it to succeed in today’s environment.”
Open Skies, he said, “wasn’t really given a chance to succeed,” and the rationale for it made less sense over time, as airline consolidation, the rise of alliances and the creation of multi-national airline groups like IAG and Air France-KLM ultimately changed the airline landscape. “Now it’s all about competing with Norwegian” on the North Atlantic, he said.