Shuttle by United
Encyclopedia
Shuttle by United was an "airline
within an airline" brand operated as a subsidiary of United Airlines
from 1994 to 2001 along the West Coast of the United States
. It provided air shuttle
service between San Francisco International Airport
(SFO), Los Angeles International Airport
(LAX), and other cities using Boeing 737-300 and 737-500
aircraft.
The economic recession
of the early 1990s, plus the relentless expansion of low-cost carrier
s and other effects of deregulation
pressured the major airlines to reduce costs and fares. In 1993 United Airlines concluded an agreement with its unions whereby employees would take ownership of 55% of airline in exchange for reduced wages and benefits for new employees. The management moved to organize the lowest scales into a new "airline within an airline" dubbed "U-2."
"U-2" attempted to replicate some of the cost advantages of regional competitors such as Southwest Airlines
. All 58 of its aircraft were of a single type, the B-737. Hot meals were eliminated. The fare structure would be reduced and simplified to lure passengers, with revenue stabilized by increasing frequency of service, while electronic ticketing
would reduce costs.
At the same time, "U-2" would remain legally part of United Airlines, with access to its Apollo Computer Reservation System. Passengers would still enjoy pre-assigned seating, could transfer seamlessly to and from "mainline" service, and accumulate miles in United's Mileage Plus frequent flyer program
. In this respect, it resembled competitors' first generation "airline within an airline" divisions such as Continental Lite
, Delta Express
, and US Airways
' Metrojet
.
Shuttle by United, as "U-2" became known to the public, began operating on October 1, 1994, out of SFO. It offered flights to Los Angeles
for as little as $19 one-way. Within three years it had expanded to 20 cities and comprised 5% of United's total capacity. In 1999 it established a second base in Terminal 8 of Los Angeles International Airport
, United's newest hub
, by which time it also served as a feeder operation for United's transcontinental and international services. In the late 1990s its name was changed to United Shuttle.
With demand for travel to the San Francisco Bay Area
heavy during the Dot-com bubble
, Shuttle became profitable, but it also encountered mounting operational problems and labor unrest. Frequent fog
at SFO had always caused flight delays. These delays became compounded with Shuttle's high frequency schedule, and compounded again by inadequate staffing. In 2000, two out of every three shuttle flights between SFO and LAX were delayed or canceled.
When air travel declined in 2001, it became evident that cost savings had not materialized to justify the separate operation of the Shuttle, and it was folded back into mainline United.
In December 2002, United declared bankruptcy
and hinted at a revival of the Shuttle. However, it instead created a leisure destination carrier called Ted
, part of a second generation of "airline within an airline" services with Delta Air Lines
' Song
and Air Canada Tango
. Ted itself ceased operations in early 2009 and its fleet was folded back into United's.
Airline
An airline provides air transport services for traveling passengers and freight. Airlines lease or own their aircraft with which to supply these services and may form partnerships or alliances with other airlines for mutual benefit...
within an airline" brand operated as a subsidiary of United Airlines
United Airlines
United Air Lines, Inc., is the world's largest airline with 86,852 employees United Air Lines, Inc., is the world's largest airline with 86,852 employees United Air Lines, Inc., is the world's largest airline with 86,852 employees (which includes the entire holding company United Continental...
from 1994 to 2001 along the West Coast of the United States
West Coast of the United States
West Coast or Pacific Coast are terms for the westernmost coastal states of the United States. The term most often refers to the states of California, Oregon, and Washington. Although not part of the contiguous United States, Alaska and Hawaii do border the Pacific Ocean but can't be included in...
. It provided air shuttle
Air shuttle
An air shuttle is a scheduled airline service that operates a frequent, regular service on short routes with a simplified fare and class structure. Although no exact specifications exist, frequency is normally once per hour or more often and travel time is typically an hour or less, although longer...
service between San Francisco International Airport
San Francisco International Airport
San Francisco International Airport is a major international airport located south of downtown San Francisco, California, United States, near the cities of Millbrae and San Bruno in unincorporated San Mateo County. It is often referred to as SFO...
(SFO), Los Angeles International Airport
Los Angeles International Airport
Los Angeles International Airport is the primary airport serving the Greater Los Angeles Area, the second-most populated metropolitan area in the United States. It is most often referred to by its IATA airport code LAX, with the letters pronounced individually...
(LAX), and other cities using Boeing 737-300 and 737-500
Boeing 737
The Boeing 737 is a short- to medium-range, twin-engine narrow-body jet airliner. Originally developed as a shorter, lower-cost twin-engine airliner derived from Boeing's 707 and 727, the 737 has developed into a family of nine passenger models with a capacity of 85 to 215 passengers...
aircraft.
The economic recession
Recession
In economics, a recession is a business cycle contraction, a general slowdown in economic activity. During recessions, many macroeconomic indicators vary in a similar way...
of the early 1990s, plus the relentless expansion of low-cost carrier
Low-cost carrier
A low-cost carrier or low-cost airline is an airline that generally has lower fares and fewer comforts...
s and other effects of deregulation
Airline Deregulation Act
The Airline Deregulation Act is a United States federal law signed into law on October 24, 1978. The main purpose of the act was to remove government control over fares, routes and market entry from commercial aviation...
pressured the major airlines to reduce costs and fares. In 1993 United Airlines concluded an agreement with its unions whereby employees would take ownership of 55% of airline in exchange for reduced wages and benefits for new employees. The management moved to organize the lowest scales into a new "airline within an airline" dubbed "U-2."
Southwest Airlines
Southwest Airlines Co. is an American low-cost airline based in Dallas, Texas. Southwest is the largest airline in the United States, based upon domestic passengers carried,...
. All 58 of its aircraft were of a single type, the B-737. Hot meals were eliminated. The fare structure would be reduced and simplified to lure passengers, with revenue stabilized by increasing frequency of service, while electronic ticketing
E ticket
The phrase E ticket refers to an unusually interesting, thrilling or expensive experience. It derives from the admission ticket system used at Disneyland and Magic Kingdom theme parks before 1982, in which the E ticket admitted the bearer to the newest, most advanced, and/or most popular rides...
would reduce costs.
At the same time, "U-2" would remain legally part of United Airlines, with access to its Apollo Computer Reservation System. Passengers would still enjoy pre-assigned seating, could transfer seamlessly to and from "mainline" service, and accumulate miles in United's Mileage Plus frequent flyer program
Frequent flyer program
A frequent flyer program is a loyalty program offered by many airlines. Typically, airline customers enrolled in the program accumulate frequent flyer miles corresponding to the distance flown on that airline or its partners. There are other ways to accumulate miles...
. In this respect, it resembled competitors' first generation "airline within an airline" divisions such as Continental Lite
Continental Lite
Continental Lite was a short lived "airline within an airline" brand of Continental Airlines established in 1993. The airline folded in 1995 after losing was has been reported in the press as between $140 million or $300 million....
, Delta Express
Delta Express
Delta Express was a no-frills "airline within an airline" brand owned and operated by Delta Air Lines from 1996 to 2003. The airline was headquartered in Atlanta, Georgia....
, and US Airways
US Airways
US Airways, Inc. is a major airline based in the U.S. city of Tempe, Arizona. The airline is an operating unit of US Airways Group and is the sixth largest airline by traffic and eighth largest by market value in the country....
' Metrojet
MetroJet
MetroJet was a no-frills "airline within an airline" brand operated as a division of US Airways from 1998 to 2001.-History:After the conclusion of painstaking labor negotiations in 1997, US Airways sought to head off burgeoning competition from low-cost carriers in its strongest region, the U.S....
.
Shuttle by United, as "U-2" became known to the public, began operating on October 1, 1994, out of SFO. It offered flights to Los Angeles
Los Ángeles
Los Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
for as little as $19 one-way. Within three years it had expanded to 20 cities and comprised 5% of United's total capacity. In 1999 it established a second base in Terminal 8 of Los Angeles International Airport
Los Angeles International Airport
Los Angeles International Airport is the primary airport serving the Greater Los Angeles Area, the second-most populated metropolitan area in the United States. It is most often referred to by its IATA airport code LAX, with the letters pronounced individually...
, United's newest hub
Airline hub
An airline hub is an airport that an airline uses as a transfer point to get passengers to their intended destination. It is part of a hub and spoke model, where travelers moving between airports not served by direct flights change planes en route to their destinations...
, by which time it also served as a feeder operation for United's transcontinental and international services. In the late 1990s its name was changed to United Shuttle.
San Francisco Bay Area
The San Francisco Bay Area, commonly known as the Bay Area, is a populated region that surrounds the San Francisco and San Pablo estuaries in Northern California. The region encompasses metropolitan areas of San Francisco, Oakland, and San Jose, along with smaller urban and rural areas...
heavy during the Dot-com bubble
Dot-com bubble
The dot-com bubble was a speculative bubble covering roughly 1995–2000 during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the more...
, Shuttle became profitable, but it also encountered mounting operational problems and labor unrest. Frequent fog
Fog
Fog is a collection of water droplets or ice crystals suspended in the air at or near the Earth's surface. While fog is a type of stratus cloud, the term "fog" is typically distinguished from the more generic term "cloud" in that fog is low-lying, and the moisture in the fog is often generated...
at SFO had always caused flight delays. These delays became compounded with Shuttle's high frequency schedule, and compounded again by inadequate staffing. In 2000, two out of every three shuttle flights between SFO and LAX were delayed or canceled.
When air travel declined in 2001, it became evident that cost savings had not materialized to justify the separate operation of the Shuttle, and it was folded back into mainline United.
In December 2002, United declared bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
and hinted at a revival of the Shuttle. However, it instead created a leisure destination carrier called Ted
Ted (airline)
Ted was one of two "airline within an airline" divisional brands of United Airlines. It targeted vacation locations. Ted targeted to compete in the low cost airline market. In contrast to United's high end divisional "sub-fleeted" brand called United p.s., "Ted" comes from the last three letters...
, part of a second generation of "airline within an airline" services with Delta Air Lines
Delta Air Lines
Delta Air Lines, Inc. is a major airline based in the United States and headquartered in Atlanta, Georgia. The airline operates an extensive domestic and international network serving all continents except Antarctica. Delta and its subsidiaries operate over 4,000 flights every day...
' Song
Song (airline)
Song, LLC was a low-cost "airline within an airline" brand owned and operated by Delta Air Lines.Song's main focus was on leisure traffic between the northeastern United States and Florida, a market where it competed with JetBlue Airways...
and Air Canada Tango
Air Canada Tango
Air Canada Tango was a low-cost branch of Air Canada, which was established in 2001 to offer no-frills service on some of Air Canada's routes and to reduce operating costs at the struggling main company...
. Ted itself ceased operations in early 2009 and its fleet was folded back into United's.
See also
- Delta ExpressDelta ExpressDelta Express was a no-frills "airline within an airline" brand owned and operated by Delta Air Lines from 1996 to 2003. The airline was headquartered in Atlanta, Georgia....
a low-cost subsidiary of Delta from 1996 until 2003 that preceded Song - SongSong (airline)Song, LLC was a low-cost "airline within an airline" brand owned and operated by Delta Air Lines.Song's main focus was on leisure traffic between the northeastern United States and Florida, a market where it competed with JetBlue Airways...
a low-cost subsidiary of Delta that operated from 2003 until 2006 that replaced Delta Express - TedTed (airline)Ted was one of two "airline within an airline" divisional brands of United Airlines. It targeted vacation locations. Ted targeted to compete in the low cost airline market. In contrast to United's high end divisional "sub-fleeted" brand called United p.s., "Ted" comes from the last three letters...
a low-cost subsidiary of UnitedUnited AirlinesUnited Air Lines, Inc., is the world's largest airline with 86,852 employees United Air Lines, Inc., is the world's largest airline with 86,852 employees United Air Lines, Inc., is the world's largest airline with 86,852 employees (which includes the entire holding company United Continental...
that operated from 2003 to 2009 and replaced Shuttle by United