RIP H(.)(.)ters air [Archive]

carreraelite

03-30-2006, 07:33 AM

By Garrison Wells
The Sun News
Time may be running short for Hooters Air.
While Robert Brooks, a Loris native and owner of the Myrtle Beach-based charter airline, declined to say the airline would soon shut down, he cast doubt on its future.
"I just hate to quit. I'm still fighting, but don't expect anything long term," he said Monday. "I dearly wished it could have turned out better."
Brooks is also chairman of Hooters of America, an international restaurant chain known for its scantily clad Hooters Girls. The company also owns a casino in Las Vegas that opened in February.
In a wide-ranging interview with The Sun News, Brooks said he is "open for suggestions" over what to do about Hooters Air.
"I haven't had any surprises in the casino business, or in manufacturing, or in the restaurant business, which we deal in worldwide, but the airline business is crazy," he said. "The airline business isn't my cup of tea."
He does have options - including finding investors to pump capital into the financially ailing airline or selling to new owners.
Indeed, Brooks said the airline was contacted Monday by a potential buyer, though he downplayed a deal.
Whether he sells or not, the airline industry hasn't been kind.
"I've not been enamored with the industry in general," Brooks said. "You can't depend on anybody and anything. It's dog-eat-dog and one thing or another from one minute to the next. What I understand about it, I don't like what I see."
If Hooters Air does go out of business, its traffic will be picked up by other airlines, said Lisa Bourcier, Horry County spokeswoman.
But passengers would lose some direct flights.
"They would have to go through hubs," she said. "That's going to be an unfortunate situation because they had direct flights, like the Bahamas."
Besides its direct flights to the Bahamas, Hooters flew connecting flights to major markets such as Denver.
Signs of financial distress at Hooters Air have been swirling for several months.
Besides its latest trimming of service to destinations outside of Myrtle Beach, the airline for the first time this year stopped offseason service at Myrtle Beach International Airport.
The airline also ran up bills at other airports - even getting its fuel service cut at Lehigh Valley International Airport in Pennsylvania, after falling behind by almost $1 million.
At the time, Hooters Air President Mark Peterson told The Sun News that running up such a debt was not a big issue.
Says airline industry analyst Tim Sieber, however, "when you are cut off, that is pretty profound."
"Airlines find ways to come up with the cash," said Sieber, vice president at The Boyd Group, a Colorado-based aviation consulting firm. "For airlines to be late, especially these days, is not uncommon, but usually they pay by the second notice. To have the service cut, that is an anomaly.
"Obviously the schedule charter business has not been successful for them," Sieber said.
Peterson did not return telephone calls.
Among problems for Hooters and its brethren, according to Sieber:
The low fare sector of the airline industry is highly competitive, and airlines are cutting rates.
Charters such as Hooters are having to look harder and deeper to find places where their business models will work.
Rising fuel prices put airlines, especially those dependent upon leisure travelers, in an awkward situation. To recoup their expenses, they have to increase prices. At the same time, however, consumers are seeing their discretionary incomes cut as they pay more at the pump.
"It is costing more and more money to heat my home, more money to fill up up my car. It gives me less disposable income for a trip," Sieber said.
Still, not every charter airline is in trouble.
The future for charter airlines "depends on the market and it depends on the carrier," he said.
"You look at Allegiant Air, which has routes to Las Vegas. Allegiant is doing extremely well, but they are also savvy. Maybe what Brooks needs is a combination of capital and beefing up his management team a bit."