Silverjet... another one bites the dust

[Jason Le]

To our dear customers,

When our inaugural flight took off in January 2007, we pledged to change the face of air travel. Your appreciation of our unique values and your belief in our product has allowed us to achieve this.

Your belief in us was shared by our investors - but regrettably, due to unforeseen circumstances, they were unable to unlock the finance that we needed. As a result, we are very sad to announce that from 30 May 2008, we will cease operations and we are no longer able to honour flight reservations.

We extend our sincerest apologies to those of you who have travel plans with Silverjet in the future and at present. You are advised to seek alternative travel arrangements with other carriers, and contact your credit card company or travel agent directly for information on obtaining refunds.

We are working actively with new investors who are prepared to inject new funds so we can recommence operations. If we are able to achieve this, we will make an announcement as soon as possible and we hope to be able to bring you our very 'sivilised' flying experience again.

Thank you for your support - it has meant everything.

Yours sincerely,




Lawrence Hunt, CEO

[Tom Lohdan]

The 3rd Business Class only airline to call it quits in the last 6 months.

I'm just waiting for one of the big ones to go bust :(

[Chris Tully]

It is not a sustainable business.

Even with today’s large amount of business and corporate travel it is rare to see sales of full-priced business class fares.

A significant amount of traffic in these cabins travel on redemption (points).

[Will T]

I agree with Chris. The market for stand-alone differentiated, low cost, all premium long-haul travel is limited (imho), and airlines trading away network features and feed for price are unlikely to get anything like the corporate yield or revenue quality that the big network carriers can (and do) get.

A lot of these 'product-specialist/low fare' trans-Atlantic carriers targeted the SME market ('the independent business traveller') - as indeed Virgin Blue have been of late - but little is known about this segment, and I'm not so sure that they're always a better customer than the typical full service leisure traveller. They're price-sensitive, and seem to expect all the accoutrements of premium cabins, without paying for them. Oasis targeted a similar segment, and was also unsuccessful. Obviously the fuel price has compounded the woes of any airline yet to reach 'critical mass', too.

As I see it, the scope for long-haul, dedicated premium services is - under the present circumstances - confined to selected spokes of existing full service networks, having the required yield and margin quality (eg. Privatair in Europe, SQ all-business to New York, a potential QF SYD/LON vv. non-stop, etc). Time will tell!

[D Chan]

(eg. Privatair in Europe, SQ all-business to New York, a potential QF SYD/LON vv. non-stop, etc). Time will tell!

Time will certainly tell but I think Privatair has a good chance to survive. They operate for other airlines and so they will still have pax from the respective airline's networks.

Regarding SQ. I wonder if they are able to generate much highly time-sensitive cargo revenue from their all business class service. I would think with less pax on the main deck (albeit heavier seats) might mean some of the weight reduction which could go to carraige of freight on the holds.

About Silverjet, I was just reading Airline Business or perhaps it was Flight International, that an arab investor in Dubai was willing to chip into Silverjet so that it could expand to other markets etc. obviously this hasn't happened. Maybe the investor pulled out of the deal :P