Airline Flashback: Vanguard Airlines
Many people may not remember the discount airline Vanguard Airlines, but they played a pivotal role in introducing discount/low cost airfare to many cities around the United States in the 90’s and early 2000’s.
Vanguard Airlines was headquartered in Kansas City, Missouri and operated from 1994 until their demise in 2002. The airline operated leased Boeing 727-200’s, Boeing 737-200’s, Boeing 737-300’s, and McDonnell Douglas MD-80 and MD-87 airliners.
Vanguard started as a low-fare, low-cost airline in their early days. The purpose of the airline was to undercut the costs of major airlines by charging lower fares. It was not unheard of to book an advanced early reservation on Vanguard for $29/one way. Also, the airline offered promotional fares as low as $10 on certain routes from time to time.
By the time Vanguard came onto the scene with their low cost tickets, most of the major airlines had already learned how to deal with low cost airlines, and would simply lower their own prices on certain routes until the low-cost airline ran out of capital and shut down.
In the early days of Vanguard Airlines (1995), they operated scheduled non-stop service between their hub in Kansas City and Dallas/Fort Worth, Denver, and Milwaukee, along with service to Salt Lake City with a stop in Denver. All flights at this time were operated with the Boeing 737-200 aircraft in a single all coach configuration. By the summer of 1995, the airline added new service between Kansas City and Des Moines, Minneapolis/St. Paul, and Wichita.
Vanguard also added service between Minneapolis and Chicago Midway, which was the beginning of a new ‘focus city’ for the airline.
During the summer of 1996, Vanguard began flying nonstop between Kansas City and California (Los Angeles and San Francisco).
By the winter of 1996, Vanguard was operating flight between Kansas City and Atlanta, Fort Myers, Las Vegas, Miami, Orlando, and Tampa (ceasing Salt Lake City).
During the summer of 1997, service was added between Kansas City and New York City, and service was added from Kansas City to Washington Dulles in the fall of 1997.
During the fall of 1997, the airline began to build up a small presence in Pittsburgh, by adding flights to Chicago Midway, Kansas City, Minneapolis/St. Paul, and New York JFK. The airline would also add seasonal service to Myrtle Beach in 1999.
In 2000, the airline began to drastically scale back its operations at Chicago Midway Airport until the only remaining route was a single Kansas City – Chicago – Buffalo routing.
The new millennium in 2000 brought about other big changes for Vanguard Airlines. The airline decided to change itself from a low-fare/low-cost airline to a low-cost carrier model. This meant that the airline would compete on more than just ticket price, and would compete on things such as service, on-time performance, frequent flyer programs, leg room, and more. The $29/one way tickets had vanished and the ticket prices were more in line with those that were offered by the major airlines.
These changes worked and the airline began to see serious improvements in their financial and operational performance during the 2000-2001 time frame. However, the September 11th terror attacks in the United States changed everything for Vanguard Airlines. Shortly after, the airline cut 20% of its staff, and full time employees were cut back to 32 hours per week. Vanguard struggled to fill planes that were now flying on reduced schedules and sometimes half full or less.
In another attempt to improve their brand, the airline introduced multi-colored aircraft liveries and phased out the old blue/white and all white paint schemes. The airline also took on McDonnell Douglas MD-80 aircraft in order to help improve their bottom line.
While the downturn in air travel due to the September 11th attacks hurt Vanguard, the dagger was their decision to switch their reservation system from Open Skies to SABRE. The decision cost millions of dollars that the airline didn’t have, and the overall adaptation was difficult, leading to more financial woes for the airline.
During the summer of 2001, the airline was struggling and facing $80 million dollars in debt. Credit card processors for the airline required greater assurances that they would not lose money should the airline go under. Surety bonds of 125% of sales were required to continue processing credit cards for bookings. As each ticket was sold, the airline was actually losing money. Finally, on July 29th, 2002, Vanguard Airlines ceased operations for good.
Shortly after bankruptcy, the owner of Hooters Restaurants and PACE Aviation offered to purchase the airline. The offer was rejected and the company was liquidated.
Vanguard Airlines Fleet (as of grounding in 2002)
- (1) McDonnell Douglas MD-81 (132 passengers – 12 Business / 120 Coach)
- (3) McDonnell Douglas MD-82 (132 Passengers – 12 Business / 120 Coach or 14 Business / 118 Coach)
- (1) McDonnell Douglas MD-83 (132 Passengers – 12 Business / 120 Coach)
- (2) McDonnell Douglas MD-87 (112 Passengers – 12 Business / 100 Coach)
- (2) Boeing 727-200 (164 Passengers – All Coach Configuration) – Wet leased from TransMeridian Airlines
- (6) Boeing 737-200 (120 Passengers – All Coach Configuration)