The story
Founded by Freddie Laker in 1966.1
Early history
Freddie Laker announced the creation of Laker Airways in February 1966. In fact, the airline had been formally registered on the 8th of the month and commenced operations from its Gatwick Airport base on the followiung 29 July with two Bristol Britannia 102 series turboprops, initially operating on Air France behalf. The aircraft's livery was a combination of black, red and white – an adaptation of Laker's racing colours. The Britannias were supplemented and eventually replaced by five BAC One-Eleven 300 short-haul jet aircraft from December 1967. This included an initial 1966 order with the manufacturer for three aircraft valued at £4 million.
Laker spent more than £200,000 of his own money on the newly-ordered aircraft's deposits, with a consortium of City banks led by Clydesdale Bank funding the remainder. He placed a follow-up order for a fourth aircraft to be delivered in 1968 and acquired a former-British Eagle aircraft from Bahamas Airways in 1971. These airline's short- and medium-haul charter operations to holiday resorts in the Mediterranean and the Canary Islands were primarily operated with these aircraft.
Operational history
Laker Airways offered 30% discounts to tour operators to charter the airline's aircraft during the winter, when demand was lower, and implemented other promotions to incentivise longer-term use of the aircraft by tour operators. This ensured that the fleet was in use for almost the entire year.
August 1968 saw the establishment of its first overseas base at Tegel Airport in what was then West Berlin. The company had up to three BAC One-Elevens stationed there until 1981, when these aircraft were replaced with one of its three newly acquired Airbus A300 B4 series wide-bodies, at the time the largest aircraft operated out of any Berlin airport.
Its Berlin operation was staffed by ninety, mainly local, workers. Throughout this period, it carried thousands of holidaymakers from the Western parts of the then divided German capital to resorts in the Mediterranean and the Canary Islands.
Ground handling
In 1972, Laker Airways co-founded Gatwick Handling, a Gatwick handling agent that has become part of the Aviance group, with Dan-Air. Each airline owned 50% of Gatwick Handling at its inception.
Climbing speed
In the days when airports and air space were relatively uncongested, Laker Airways instructed departing One-Eleven crews to tune into other jet aircraft taking off ahead of them, and to begin a conversation with the other aircraft's crew while continuing their climb. The aim was to obtain information about the other aircraft's altitude to encourage that aircraft's crew to climb to their upper cruising altitude as quickly as possible so that Laker's One-Elevens could attain their optimum height in the shortest possible time. This helped Laker's One-Elevens climb faster without using as much power, helping the company to reduce fuel consumption and reduce the engines' wear and tear.
Weight-saving
Among the weight-saving measures Laker Airways used to make its aircraft fly further without the need of refuelling was a baggage allowance limit of 40 lb (18 kg) rather less than the more usual 44 lb (20 kg), and carrying fewer passengers than the aircraft could hold. This policy was first employed when the airline began operating its BAC One-Elevens. By limiting the free baggage allowance and restricting passengers, the company used the weight saved to carry additional fuel, increasing range.
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This was sufficient to permit non-stop flights from London Gatwick or Berlin Tegel to Tenerife at least in one direction, depending on the direction and strength of the winds. This helped make Laker's One-Elevens more competitive with larger, longer-range aircraft operated by rivals, especially for tour operators struggling to fill a bigger aircraft profitably. If the passenger load was greater than 70, the charterer paid for any stops, encouraging operators to keep to 70 passengers.
Alternatively, weight saved as a result of limiting free baggage could be traded for reduced fuel consumption on shorter routes well within the BAC One-Eleven's range by making the aircraft lighter, even with a full load of passengers.
Introduction of DC-10 aircraft
Weight-saving measures adopted to boost the BAC One-Eleven's range stood Laker Airways in good stead when the airline introduced the McDonnell Douglas DC-10-10.
This model lacked the range of the DC-10-30. The DC-10-10 was optimised for medium-haul routes. The aircraft McDonnell Douglas was offering had been built against an order placed by Mitsui Group, for five aircraft, who intended to lease them to All Nippon Airways (ANA). But, instead, ANA decided to order the Lockheed L-1011 Tristar. Before offering, on behalf of Mitsui, the aircraft to Laker, McDonnell Douglas had asked British Caledonian (BCal) whether it was interested. BCal was looking for a widebody replacement for its ageing Boeing 707s and Vickers VC10s. BCal rejected this offer because the aircraft had insufficient range to fly non-stop from Gatwick to the distant points on its network.
Despite these drawbacks, Laker Airways took two of those five Mitsui (originally intended for ANA) ordered aircraft. The three remaining Mitsui aircraft went to Turkish Airlines. One of these later crashed as Turkish Airlines Flight 981. The airline concluded it could fly non-stop from the UK to any point east of the Rockies by keeping the baggage limit at 40 lb (18 kg) and reducing single-class seating from 380 to 345. The saving could be used to carry more fuel. The calculations had shown that even with reduced seating, it had to fill only 52% of the seats to break even. Moreover, Laker Airways had figured that the aircraft's low break-even seat factor would enable it to operate its proposed London – New York Skytrain with a lower break-even factor compared to the Boeing 707, an ageing narrow-bodied aircraft whose costs were higher per passenger. The DC-10s also had huge potential to boost the projected profitability of Skytrain. Revised estimates anticipated an average load factor of 70–75% and raised the traffic forecast for the first year of operation to 250,000 passengers each way. This was almost three times the original 707-based forecast. These factors swung the firm in favour of McDonnell-Douglas's offer.
A Laker Airways McDonnell Douglas DC-10 series 10 was one of four widebodies that were specially flown in for the pre-inauguration of the then-new terminal building at Berlin's Tegel Airport on 23 October 1974. (A British Airways (BA) Lockheed L-1011 Tristar 1, a Pan Am Boeing 747-100 and an Air France Airbus A300 B2 were the other widebodies specially flown in on that day to mark this occasion.)
Introduction of Skytrain
The early 1970s saw the airline and its owner battle with aviation authorities in the UK and US to gain approval for a low-cost, "no frills" transatlantic service to link London and New York daily during the peak summer period from May to September and four times a week during the remainder of the year. This was to be marketed as Skytrain for £32.50 one-way in winter and £37.50 in summer. Two Boeing 707-138Bs were acquired from the administrators of British Eagle in 1969. Both were operated by Qantas when new.
They were subsequently purchased by Kleinwort Benson, which had leased them to British Eagle until its demise in November 1968. These aircraft were earmarked for Skytrain. Laker's original Skytrain application assumed a 62.9% break-even load factor. This meant that the airline needed to sell 100 out of 158 seats at a single fare of £37.50 per seat on each flight to start making money with Skytrain. Sir Freddie announced Skytrain at a press conference at London's Savoy Hotel on 30 June 1971.
Laker claimed that there was demand for this kind of service and maintained that it would increase the total number of passengers flying between Britain and the United States each year from 14m to 16m, rather than diverting other airlines' existing passengers.
Since approval for Skytrain was not forthcoming for several years, Laker Airways needed alternative work to keep its long-haul planes busy. Initially, both Boeing 707s supplemented the BAC One-Elevens on Mediterranean and Canary Islands routes, such as Gatwick – Palma de Mallorca and Gatwick–Tenerife. Both aircraft replaced Bristol Britannias on the airline's long-haul flights, an increasing number of which were affinity group charters to North America, primarily the US.
During summer 1970, Laker sought the UK and Australian authorities' permission to operate a series of affinity group charter flights to Australia. Following his request's refusal, he flew to Australia in early 1971 to discuss his proposal for 15-day inclusive tours from Australia to the UK, including full board at first class hotels for A$935, with the director-general of the Australian Department of Civil Aviation who doubled as Qantas's chairman. Freddie Laker’s visit did not succeed in convincing the Australian authorities of his proposal's merits as a result of lobbying from BOAC and Qantas, both of which were estimated to have lost £11 million in revenue due to competition from charter airlines on the Kangaroo route.
From December 1970, one of Laker's two 707s was used for a once-a-week low-fare service linking Luxembourg with Barbados on behalf of International Caribbean Airways, a joint venture between Barbados businessmen Norman Ricketts and Geoffrey Edwards, who enjoyed the support of the Barbados government, and Laker Airways. Laker Airways initially held a 33% stake in International Caribbean. The aircraft Laker Airways allocated to International Caribbean Airways sported International Caribbean as well as the Barbadian flag on both sides of the forward fuselage in place of Laker and the Union Flag featured by the company's other aircraft. In addition to the weekly Luxembourg–Barbados schedule, which subsequently became twice weekly and was extended to London Gatwick, this aircraft operated regular charters from Canada and West Germany to Barbados. In January 1975, the International Air Transport Association (IATA) designated International Caribbean Airways the flag carrier for Barbados.
Laker Airways had taken delivery of a fourth McDonnell-Douglas DC-10 series 10 widebodied jet in 1976 in preparation for the launch of its daily London to New York Skytrain. This aircraft was the DC-10's second prototype, which the airline had acquired direct from MDC at a knock-down price. By that time, the work force had expanded to 1,000.
Skytrain was inaugurated between London Gatwick and New York JFK on 26 September 1977. It recorded a profit in excess of £2 million in its first year of operation.
In early 1979, the airline ordered a further two DC-10 series 10 widebodies as well as five longer range McDonnell-Douglas DC-10 series 30 widebodied aircraft.
Laker Airways expanded to Los Angeles (1978). The company acquired two-second-hand Boeing 707-351B narrow-bodied long-haul aircraft from Cathay Pacific to commence non-stop operations to the US West Coast prior to receiving the first of the McDonnell-Douglas DC-10 series 30 aircraft that were on order.
Following a public hearing, the Civil Aviation Authority (CAA) approved Laker's request to operate unrestricted Skytrain services at the beginning of July 1979. This enabled the airline to offer bookable seats, excursion fares and the carriage of cargo in addition to the original, non-bookable Skytrain fare from Gatwick to New York JFK and Los Angeles.
With the arrival of the series 30 DC-10s, Intasun owner Harry Goodman recognised that long-haul charters to new destinations were now available and approached Laker with a number of possibilities from the Caribbean to Florida. Eventually, Goodman chose Florida and Disney World charters were introduced to the UK market. The programme rapidly expanded to seven times weekly and was eventually converted into a Skytrain operation to Miami.
By October 1980, Laker introduced fully bookable Super Economy fares on all Skytrain services. These were approximately half its competitors' standard economy fares and significantly lower than those airlines' Super APEX fares. The airline reserved about 60% of its scheduled seats for the new bookable fares. This move marked a major strategic shift in the company's fare structure.
Tampa, Florida, was added in 1981 from Gatwick, Manchester and Prestwick, following lobbying from Bob Beckman's client. By that time, the firm had sold both the older, shorter fuselage Boeing 707-138Bs and disposed of one BAC One-Eleven. This left it with 20 aircraft comprising 14 widebodies and six narrowbodies – 11 DC-10s, three A300s, two 707s and four One-Elevens, doubling the size within only five years. Over this period, the number working for Laker Airways and associated companies doubled again to 2,000.
During the 1981 summer period, Laker operated up to three daily frequencies each way between Gatwick and JFK and Gatwick and Miami as well as twice daily round-trips between Gatwick and Los Angeles. This made Laker the fourth biggest transatlantic scheduled airline between the UK and US as well as fifth biggest overall. By that time, the airline had carried over two million Skytrain passengers.
Widebody era
In November 1972, Laker Airways became the first airline outside North America to operate the McDonnell Douglas DC-10 widebody when it took delivery of a pair of new series 10 aircraft from McDonnell Douglas Corporation's (MDC) factory in Long Beach, California, via Japanese lessor Mitsui.
Simplified charter rules
On 1 April 1973, new charter regulations in the UK, the US and Canada replaced the complicated "affinity group" rules with simplified rules termed "Advance Booking Charters", popularly known as ABC. The following day, a Laker Airways McDonnell-Douglas DC-10 flew the world's inaugural ABC flight from Manchester to Toronto. Laker's first ABC passengers had paid £45 round-trip. The inaugural flight was operated under contract to Laker's Liverpool-based in-house package tour operator Arrowsmith Holidays, a group company since 1967. It was followed by similar ABC services from Prestwick and a three-times-a-week Gatwick–Toronto ABC operation. The latter was operated under contract to Lord Brothers, the airline's London-based in-house tour operator that had been part of the group since 1968 and changed its name to Laker Air Travel in 1974.
A third DC-10 series 10 widebody joined the fleet in April 1974 to maintain the airline's commitments in the ABC flights market. (Laker intended to allocate two DC-10s exclusively to Skytrain in anticipation of the start of daily services between Stansted and Newark later that year. This aircraft was eventually used to meet growing ABC commitments.)
The new ABC rules enabled Sir Freddie to build a successful ABC flights business across the North Atlantic over the next couple of years, making Laker Airways the market leader in transatlantic ABC flights. During the early to mid-1970s, the airline ran low-key advertising on hoardings and public transport in London, Manchester and other large British cities under the motto "Take a Laker".
Laker's transatlantic charters provided meals, movies (at the time, a new amenity), and a free bar.
The success of Laker Airways's transatlantic ABC flights resulted in an application to launch an Australian low-fare operation from Gatwick and/or Luxembourg to Sydney and Melbourne. Laker's application was dismissed by Peter Nixon, the Australian Transport Minister. Nixon stated that the UK–Australia scheduled air services market was to remain the preserve of BA and Qantas. This decision was the result of successful lobbying by Qantas, which had exerted pressure on its government to protect the long-established duopoly it shared with British Airways on the Kangaroo route under a joint revenue-sharing agreement. Nixon also maintained that the proposed service to only two Australian points would be discriminatory on people living in other parts of the country by denying them the benefits of low fares. These comments prompted Sir Freddie to retort that the Australian transport minister still thought the earth was flat, and that it had not come to his attention that Australia already had a number of regional airlines covering the whole of the country.
An advertising campaign featuring the slogan "I've got my name on every plane!" was developed in conjunction with a New York-based company. It was successfully launched during the Super Bowl VIII interval in January 1974. "Laker to London – the end of Skyway robbery" was the follow-on campaign. The success of these campaigns resulted in Laker carrying more non-scheduled UK–US passengers than all US carriers combined.
Despite attaining market leadership in the transatlantic ABC market, Sir Freddie considered this second best in the absence of his Skytrain service.
Plans for a new low-fare Australian service
In 1980, Laker Airways withdrew its application to run ABC flights to Australia. Instead, the airline proposed a scheduled low-fare service from London Gatwick with one stop. It was to be one flight a day in each direction using the airline's five DC-10-30 widebodies. In contrast to Skytrain, this was to feature a first class section called Pullman. It was to operate three flights per week each to Sydney and Melbourne respectively, and one to Perth.
The CAA took a negative view of Laker's application for a UK–Australia scheduled low-fare service and a rival application by BCal to launch a conventional, scheduled service between Gatwick and four Australian destinations via Colombo at four flights a week each way. It considered Laker's market growth forecast overoptimistic, its stimulation factors unreal, and its fares intentions vague. In the CAA's opinion, the Australians were unlikely to accept another UK airline without a reciprocal service from a second Australian carrier, and the traffic on the UK–Australia route would not support two additional carriers without a substantial reduction in service frequencies of the incumbent operators. (The CAA told BCal that it considered its proposal for a new, faster service to Australia superior to Laker's, and that it would therefore look favourably on its application if it wished to re-apply with specific proposals for a joint Anglo-Australian operation.)
Second designated UK carrier to Hong Kong
The UK government decided in 1979 to open the route between London and Hong Kong to competition. This was to be by a second British scheduled carrier to ease the shortage of seats passengers were experiencing at peak times on the ten-times-a-week monopoly service by BA from Heathrow.
A race ensued when BCal, Laker and Cathay Pacific, Hong Kong's de facto "flag carrier", filed their applications with the CAA in London.
Laker proposed a daily Skytrain linking Gatwick and Hong Kong via Sharjah to be operated with single-class, 380-seat McDonnell Douglas DC-10-30s. At the CAA hearing the airline proposed larger, higher capacity Boeing 747s as soon as this was justified by increased demand. The company tried to convince the CAA that its additional all-economy class discount service was the best option to alleviate the shortage of seats on this route. Its analysis showed the bottom end of the economy market was the most under-served segment because of the scarcity of low fares. The other airlines used Laker's analysis in support of their claims that Skytrain would flood the market with cheap seats that risked undermining profitability without doing anything to alleviate the shortage of premium seats. Laker retorted that low fares would stimulate the market by meeting untapped demand from people who could not afford to fly this route because of BA's high fares, rather than taking market share from competitors. It pointed to the success of its transatlantic Skytrain in helping create demand while maintaining that its rivals' proposals would do little to meet the unsatisfied demand for low-fare seats.
The CAA awarded a licence to operate unlimited scheduled services between London and Hong Kong to BCal, which had proposed running a conventional service from Gatwick via Dubai, using its growing fleet of McDonnell Douglas DC-10-30 widebodies in a three-class configuration featuring a first and an executive class in addition to economy. BCal had also agreed to offer a number of low fares that would match the lowest fares Laker had proposed. The CAA rejected Cathay Pacific's and Laker's applications, clearing the way for BCal to become the second British scheduled carrier on that route.
From Wikipedia’s article on Laker Airways, shared under CC BY-SA 4.0.3