ORLANDO, Fla. -- The parent companies of AirTran Airways and
ValuJet plan to merge, with both subsidiaries flying the AirTran
colors.
ValuJet, however, will be known as AirTran Airlines, as opposed
to Airways, and will continue operating under its own
certificate.
The move effectively brings an end to one of the more mercurial
airline entities among the deregulated era's second wave of new
entrants.
Robert Swenson, chairman, president and chief executive officer
of AirWays Corp., AirTran's holding company, will serve as
non-executive chairman of the new company.
D. Joseph Corr, ValuJet's president and chief executive officer
of ValuJet since November, will bear those titles in the new
company.
It was not clear what, if any, role ValuJet chairman Lewis
Jordan, one of the original investors who founded the airline in
1993, would play in the new company.
Both airlines have focused on leisure travelers and
small-business travelers with low fares, but while ValuJet took on
Delta and other giants in their backyards, AirTran has tended to
seek out underserved markets.
Corr said the two-pronged approach would continue for the
foreseeable future.
The combined company will serve 46 cities with 40 aircraft.
In June, the two lines flew 368 million available seat miles;
Comair, the nation's largest regional airline, flew 245.6 million,
while Reno Air, another second-wave carrier, flew 400.4
million.
The headquarters is likely to be in Orlando, where Air Tran has
a maintenance facility, although Corr said a final decision has not
been made.
In its short history, ValuJet went from industry maverick to
darling of Wall Street to an object lesson for other carriers
following the May 17, 1996 crash of Flight 592 into the
Everglades.
In the media frenzy that followed, the carrier gained a
reputation as an enormously successful marketing organization that
didn't cut the mustard as an airline.
Over and over again, it was accused of shoddy maintenance
practices, although no link was ever established between those
procedures and the crash.
The Federal Aviation Administration shut the carrier down on
June 18, 1996; it resumed service on Sept. 30 with a
much-pared-down schedule and fleet under close FAA scrutiny.
From its inception, ValuJet eschewed the usual distribution
channels; it was ticketless from Day One and only recently began
considering the benefits of being in a CRS.
AirTran, on the other hand, has been fairly conventional,
joining the Airlines Reporting Corp. and participating in CRSs
since it began flying in 1993.
Its parent company until recently owned Mesaba Aviation, a
Northwest Airlink regional line that was acquired by Northwest
Airlines.