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What Put Panam 1/2/3 Out Of Business?  
User currently offlineUnited Airline From Hong Kong, joined Jan 2001, 9160 posts, RR: 15
Posted (2 years 9 months 3 weeks 1 day 3 hours ago) and read 8568 times:

What put Panam 1 out of business? It was doing very well and it was huge. Did they have any domestic flights?

What about Panam 2/3?

37 replies: All unread, showing first 25:
 
User currently offlinePI767 From , joined Dec 1969, posts, RR:
Reply 1, posted (2 years 9 months 3 weeks 1 day ago) and read 8450 times:

Quoting United Airline (Thread starter):
What put Panam 1 out of business? It was doing very well and it was huge. Did they have any domestic flights?

An essay could be written on what put Pan Am I out of business. Too many fuel-guzzling 747s, the National Airlines merger fiasco, the lack of a substantial domestic market to feed its international flights, the terrorist attacks of the mid-80s that kept many American's from traveling abroad, the bombing of flight 103, bad management.

I am sure someone with more time can elaborate on those topics and more.

As far as "It was doing well," Pan Am had not done well in a very, very long time. It almost seemed as though in the 80s, the name Pan Am was almost always preceded by the words "financially-troubled."

It's last decade was a sad one that saw the company sell off its Pan Am building headquarters, its entire Pacific route system and most of its routes to London Heathrow to United Airlines (two seperate transactions several years apart) and the vast majority of its remaining European route system to Delta. Pan Am was constantly selling assets or seeking concessions from its employees or anything else it could to remain in the air.

To answer your question about domestic flights, they had no real domestic route system until they acquired National Airlines in the early 80s. The acquisition was Pan Am's quick was of entering the domestic merket. However, the National route system really did not, in ANY way, compliment Pan Am's international route system. The merger gave Pan Am a decent domestic route system, but very few of the routes fed or provided connections to the exisiting international system.

The domestic system was trimmed down through the 80s to a very limited network of cities that primarily fed Pan Am's JFK and Miami international operations.

A few maps to put it all into perspective:

From April 1979, just prior to the National Airlines acquisition:

http://www.departedflights.com/PA042979.html

From April 1980, just after the National acquisition with its new domestic route:

http://www.departedflights.com/PA042780.html

February 1986, the international route system just after selling its Pacific network to United:

http://www.departedflights.com/PA021186international.html

From October 1990, just about one year before the final big asset sale and the ultimate demise of the carrier:

http://www.departedflights.com/PA102890.html

And the final, sad route map of Pan Am from October 1991:

http://www.departedflights.com/PA102791.html

As you can see...the entire 80s was a period of shrinkage and struggle for survival.

I am sure you will get some more detailed responses, but that should give you an idea.


User currently offlineapodino From United States of America, joined Apr 2005, 4234 posts, RR: 6
Reply 2, posted (2 years 9 months 3 weeks 18 hours ago) and read 8211 times:

Prior to Deregulation, Pan Am and TWA had a duopoly on US based international flying for all intents and purposes. Where this became a problem is that they did not have much domestic feed to feed this international traffic. That was not a problem in a prederegulated world. Deregulation came, and now many airlines that were big domestic airlines at the time (Delta, United, American, Eastern) coupled with new airplanes (this is right when the 767 debuted) were able to launch their own international service from their hubs. These carriers had a much better ability to feed international flights than TWA or Pan Am. TWA to their credit had done a decent job trying to adapt, until Carl Ichan came along and raped the carrier to line his own pocket. Pan Am never was able to adapt. The sad thing is the planes that would have helped them domestically (727, 737, DC9) had come out, and though they did have a few 727s, it wasnt a big enough fleet to build a decent domestic market from.

One thing to note, is that many carriers in the 80s that had huge widebody fleets ended up going under. Eastern Airlines got into trouble in large part due to their A300s, coupled with a crippling 757 order (I know its not a widebody). PeopleExpress mistakenly believed that passengers would pay a bit extra just to fly in a 747. TWA had similar problems to Pan Am with a lot of widebodies, but a weak domestic network. I believe Western Airlines also had a decent widebody fleet at the time as well. After the 80s, the airlines realized that widebodies don't always work on domestic flights, and this coupled with improved range of newer airplanes (737NG and A320) have made the domestic widebody an endangered species in the US.


User currently offlinemayor From United States of America, joined Mar 2008, 10342 posts, RR: 14
Reply 3, posted (2 years 9 months 3 weeks 18 hours ago) and read 8156 times:

Quoting apodino (Reply 2):
I believe Western Airlines also had a decent widebody fleet at the time as well.

Well, WA only had 13-14 DC-10s in its fleet. Don't know if you'd consider that "decent" or not. Nowadays, on A.net, most on here would consider that a small "subfleet".



"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
User currently offlineflightsimer From United States of America, joined Aug 2009, 536 posts, RR: 1
Reply 4, posted (2 years 9 months 3 weeks 17 hours ago) and read 8072 times:

I know its wiki, but is there any truth behind the statement that prior to deregulation, Pan Am was not allowed to have a domestic network?

Wiki States:

Quote:
When the Airline Deregulation Act of 1978 became law, it contained two clauses. "Clause A" allowed domestic carriers to begin operating on international routes while "Clause B" allowed Pan Am to operate domestically.Only "Clause A" was put into effect as the other airlines convinced Congress that Pan Am would monopolize all U.S. air routes, though the last time Pan Am was permitted to merge with another airline was in 1950 when Pan Am was permitted to purchase American Overseas Airlines from American Airlines. As a result, U.S. domestic airlines began competing with Pan Am internationally.



Commercial Pilot- SEL, MEL, Instrument
User currently offlineOzarkD9S From United States of America, joined Oct 2001, 4995 posts, RR: 21
Reply 5, posted (2 years 9 months 3 weeks 17 hours ago) and read 7993 times:

Quoting PI767 (Reply 1):


However, the National route system really did not, in ANY way, compliment Pan Am's international route system. The merger gave Pan Am a decent domestic route system, but very few of the routes fed or provided connections to the exisiting international system.

One could argue that National DID complement Pan Am at MIA. The southern tier NA network did little for PA at JFK except some Florida feed. SFO and LAX were fed by what little the IAH mini-hub could provide. But overall, yes, NA didn't do much for PA except get them some domestic stations, which were in short order realigned to feed MIA and JFK. The NA network didn't survive long.



Next Up: STL-LGA-RIC-ATL-STL
User currently offlineckfred From United States of America, joined Apr 2001, 5167 posts, RR: 1
Reply 6, posted (2 years 9 months 3 weeks 16 hours ago) and read 7954 times:

One of the other problems for the original Pan Am goes back to the international expansion of domestic carriers. Any time a new route to Europe became available from cities that weren't among the traditional international gateways (JFK/EWR, PHL, MIA, BOS, and IAD), Pan Am would file an application along with the airline that had made that city a hub.

Pan Am would cite its many years of international service. Thus, it understood how to market routes abroad and had extensive experience in recruiting and training F/As who were fluent in foreign languages. It also cited the ability to deal with international red tape and dealing with operators of airports around the globe.

The carrier operating the hub would cite its ability to funnel many passengers from across its route network into the hub to connect.

Repeatedly, Pan Am would lose the route to the other carrier.

I remember reading a number of "experts" who believed that Pan Am picked the wrong carrier for its merger. National was focused on flying people into and out of Florida. It just wasn't the right carrier for feeding its gateways on the East Coast and at SFO/LAX. It was somewhat unlikely that regulators would have allowed a merger with TWA (turning the European duopoly into a monopoly), Northwest (turning the Asian duopoly into a monopoly) or Braniff (turning the Latin American duopoly into a monopoly). However, Pan Am would have been far more successful, if it had merged with American or United. Both had the ability to move large amounts of traffic into JFK/EWR. ORD had a lot of potential for as a gateway to both Europe and Asia.


User currently offlinepoLOT From United States of America, joined Jul 2011, 2122 posts, RR: 1
Reply 7, posted (2 years 9 months 3 weeks 16 hours ago) and read 7954 times:

Quoting flightsimer (Reply 4):
I know its wiki, but is there any truth behind the statement that prior to deregulation, Pan Am was not allowed to have a domestic network?

I don't think it was set in any law, but prior to deregulation Pan Am did not have rights to fly any domestic passengers (except to HNL), and was denied the opportunity whenever they applied for them. This was one of the side effects of Juan Trippe and the actions his enemies made against Pam Am when he left.


User currently offlinemayor From United States of America, joined Mar 2008, 10342 posts, RR: 14
Reply 8, posted (2 years 9 months 3 weeks 16 hours ago) and read 7882 times:

Quoting ckfred (Reply 6):
It also cited the ability to deal with international red tape and dealing with operators of airports around the globe.

Correct........DL found out, when taking over the PA routes, about the international "red tape" and dealing with operators of airports around the globe. In some circles these are also called "bribes" or payments "under the table".



"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
User currently offlineapodino From United States of America, joined Apr 2005, 4234 posts, RR: 6
Reply 9, posted (2 years 9 months 3 weeks 16 hours ago) and read 7875 times:

I have been reading a lot in the past couple of days on these threads about Juan Trippe making many enemies inside the beltway? What exactly happened in this regard? I am curious to know more about this, because I had always looked at Trippe as a pioneer.

User currently offlinepeteschiller From United States of America, joined Feb 2010, 42 posts, RR: 0
Reply 10, posted (2 years 9 months 3 weeks 16 hours ago) and read 7845 times:

Quoting apodino (Reply 9):
have been reading a lot in the past couple of days on these threads about Juan Trippe making many enemies inside the beltway? What exactly happened in this regard? I am curious to know more about this, because I had always looked at Trippe as a pioneer.

I would also like to know this.

Also, what were PanAm 2 & 3? Surely not that clown operation that flew from Portsmouth, NH to Gary, IN; and then to MidAmerica (Scott AFB; regional St. Louis) ? That was PanAm in name only.


User currently offlinedelta2ual From United States of America, joined Dec 2007, 614 posts, RR: 1
Reply 11, posted (2 years 9 months 3 weeks 15 hours ago) and read 7771 times:

I would also add that the National merger was way overpriced. Frank Lorenzo had started buying shares of National with ambitions of eventually taking it over. Additionally, Eastern (which at that time had nothing to do with Lorenzo) stated they intended to try and merge with NA (knowing full well it would never be approved-they had too much control of Miami). PanAm panicked and kept upping their bid and eventually paid around $400 million for National. After factoring in the merger costs (paint, uniforms, airport ops) and bringing the National employees up to the PanAm payscales-it actually cost PanAm about $1 Billion-which was astronomical in those days.

A personal story to show how bad that merger was: While working a DL flight to FRA around 1995, I mentioned to one of my coworkers (former PanAm) in the back galley that "Sally" up front was also former PanAm-to which she replied, "NO! She was National!" LOL



From the world's largest airline-to the world's largest airline. Delta2ual
User currently offlinedelta2ual From United States of America, joined Dec 2007, 614 posts, RR: 1
Reply 12, posted (2 years 9 months 3 weeks 15 hours ago) and read 7729 times:

Oh, and another interesting thing (in my opinion) about PanAm was their South American routes. They eventually wound up with United. American's current South American operation came from Eastern, which came from Braniff, which came from Panagra (PanAm Grace) which was a joint venture of PanAm and Grace shipping company. I don't think many people know that.


From the world's largest airline-to the world's largest airline. Delta2ual
User currently offlineOzarkD9S From United States of America, joined Oct 2001, 4995 posts, RR: 21
Reply 13, posted (2 years 9 months 3 weeks 15 hours ago) and read 7702 times:

Quoting delta2ual (Reply 12):


American's current South American operation came from Eastern, which came from Braniff, which came from Panagra (PanAm Grace)

Braniff had it's own S.A. network before the Panagra purchase, which strengthened BI's S.A. system.



Next Up: STL-LGA-RIC-ATL-STL
User currently offlineTOMMY767 From United States of America, joined Aug 2003, 6584 posts, RR: 11
Reply 14, posted (2 years 9 months 3 weeks 15 hours ago) and read 7661 times:

I think the starting point of the Pan Am demise was indeed the National Airlines merger. That was one of the messiest in history. Unfortunately it didn't give Pan Am the domestic network that it desired and they ended up ditching a ton of National's fleet during the 1980s.

I want to say that like TWA in the late 1990s, Pan Am was on the road to a turn around in the late 1980s after they sold United the Pacific network, and slightly before lockerbie. They were a slightly "leaner" company. IIRC, they had one of their most profitable quarters in 1987 or early 1988. They also had the more efficient A300 and A310, which I'm sure the operating costs on those babies were much better than the 741s they had for their medium and long haul international routings. They also had quite a few A320s on order, but never took delivery. But Lockerbie is truly noted as the nail in the coffin for Pan Am. It was a steep downhill from then on out.

There is also some serious bad blood between Pan Am and Delta as well. Apparently Pan Am took Delta to court in 1991 because they 'promised' to keep the Pan Am name alive for the acquired hub operation out to MIA to Latin and South America. Delta ended up winning the case. What is interesting is that many Ex-Pan Am employees went onto work for Delta, especially out of JFK.

If there are inconsistencies in this post, please feel free to correct them. Most of this late Pan Am history is off the top of my head and took place when I was a toddler!



"Folks that's the news and I'm outta here!" -- Dennis Miller
User currently offlineapodino From United States of America, joined Apr 2005, 4234 posts, RR: 6
Reply 15, posted (2 years 9 months 3 weeks 15 hours ago) and read 7659 times:

You mention Lorenzo, and I can't help but wonder, would an EA/PA merger have helped both airlines? Eastern not only had a nice domestic network, but they were also big in both MIA and JFK, and their domestic network would have complemented Pan Am's perfectly. It would have allowed the combined carrier to rightsize the european network by replacing the 747's with L1011's and the like. Not to mention ATL. I think that carrier would have been a force, especially if they got their finances in order.

User currently offlineglobalflyer From United States of America, joined Dec 2005, 924 posts, RR: 3
Reply 16, posted (2 years 9 months 3 weeks 15 hours ago) and read 7639 times:

Pan Am II was originally Carnival Airlines and I think something before that. Their route system reminded me in a way to the original National...kind of sort of...

Last Carnival (KW) route map: http://www.departedflights.com/KW121996.html

Rebranded Pan Am II route map: http://www.departedflights.com/PA121697.html

I will not even discuss Pan Am III because it was a travesty to the historic name.



Landing on every Continent almost on an annual basis!
User currently offlineViscount724 From Switzerland, joined Oct 2006, 24786 posts, RR: 22
Reply 17, posted (2 years 9 months 3 weeks 11 hours ago) and read 7426 times:

Quoting apodino (Reply 2):
Prior to Deregulation, Pan Am and TWA had a duopoly on US based international flying for all intents and purposes.

That's an exaggeration. Braniff had extensive operations to Latin America and Northwest was a major operator to Asia since the 1940s. If memory correct, NW was bigger than Pan Am on North Pacific routes.


User currently offlinetheobcman From UK - England, joined Nov 2010, 140 posts, RR: 0
Reply 18, posted (2 years 9 months 3 weeks 10 hours ago) and read 7103 times:

What was the last ever PanAm 1 flight - aircraft/routing/when ?

User currently offlineturk223 From Barbados, joined Aug 2003, 396 posts, RR: 1
Reply 19, posted (2 years 9 months 3 weeks 9 hours ago) and read 6504 times:

Quoting theobcman (Reply 18):
What was the last ever PanAm 1 flight - aircraft/routing/when ?

It was PA436 BGI-MIA on 12/4/91... a 727 named "Clipper Goodwill" N368PA. Sad.


User currently offlineAirCalSNA From United States of America, joined Mar 2010, 326 posts, RR: 0
Reply 20, posted (2 years 9 months 3 weeks 9 hours ago) and read 6504 times:

One of the big gaps in the post-National route map, imo, was the absence of any international flights from Chicago or anywhere else in the MIdwest (other than Detroit). And nothing out of Texas either. It would have seemed sort of obvious (or maybe it's just hindsight) that National's route structure wouldn't provide much new international traffic for Pan Am since they already had coast-to-coast domestic service between LAX, MIA and JFK. Too bad they didn't wait a few years and buy Western, which would have at least given them SLC. Did Pan Am really hope to become a player in the domestic market or was their strategy simply to feed their international routes?

User currently offlineTango-Bravo From United States of America, joined Jun 2001, 3802 posts, RR: 29
Reply 21, posted (2 years 9 months 3 weeks 8 hours ago) and read 6040 times:

Quoting United Airline (Thread starter):
What put Panam 1 out of business? It was doing very well and it was huge. Did they have any domestic flights?

To put it succinctly... what ultimately put Pan Am 1 (1927-1991) out of business is... they ran out of assets to sell. There's obviously more to the story, namely how they got to the point of selling off even their most valuable assets...think trans-Pacific and -Atlantic routes. Certainly the seemingly senseless acquisition of National at an inflated price...considering that, with deregulation, Pan Am could have developed a 'custom-made' domestic network without the issues that came with the merger...was a major factor in precipitating the need for Pan Am to divest of their 'treasure' to pay for the 'trash' they had purchased.

[Edited 2011-10-05 18:20:49]

User currently offlineghifty From United States of America, joined Jul 2010, 889 posts, RR: 0
Reply 22, posted (2 years 9 months 3 weeks 8 hours ago) and read 5965 times:
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Quoting apodino (Reply 2):

Prior to Deregulation, Pan Am and TWA had a duopoly on US based international flying for all intents and purposes.

If Pan Am and TWA merged, would it be fair-game to say that merged entity would still be around, then? TWA had a strong(er) domestic network,..



Fly Delta Jets
User currently offlinemayor From United States of America, joined Mar 2008, 10342 posts, RR: 14
Reply 23, posted (2 years 9 months 3 weeks 5 hours ago) and read 4998 times:

Quoting delta2ual (Reply 12):
American's current South American operation came from Eastern, which came from Braniff, which came from Panagra (PanAm Grace) which was a joint venture of PanAm and Grace shipping company. I don't think many people know that.

"•First international mail and passenger route on the west coast of South America (in 1927 in Peru as Huff Daland Dusters. Route sold to Pan American Grace (Panagra) in 1928)."

"Since the dusting company's income sharply decreased after the summer growing season, Huff Daland shifted operations in the winter to the southern hemisphere: Mexico in 1925, and Peru in 1927.

It was in Peru that Woolman was first involved with passenger service by air, when he and Harris successfully secured Peruvian air traffic rights over stiff competition. In an agreement with the financiers of Pan Am, the Huff Daland Dusters' airline and air mail contracts were operated by Peruvian Airways Corporation, a Pan Am subsidiary. Service was inaugurated on September 13, 1928, from Lima to Paita and Talara, with a 6-passenger Fairchild FC-2 flown by Huff Daland Dusters pilot Dan Tobin. Peruvian Airways Corporation was absorbed into Pan American-Grace Airways (Panagra) in 1929." *

Quoting TOMMY767 (Reply 14):
There is also some serious bad blood between Pan Am and Delta as well. Apparently Pan Am took Delta to court in 1991 because they 'promised' to keep the Pan Am name alive for the acquired hub operation out to MIA to Latin and South America. Delta ended up winning the case. What is interesting is that many Ex-Pan Am employees went onto work for Delta, especially out of JFK.

That "promise" was based on misinformation from PA to DL about profits on the Latin American system. It was found out that the operation was losing money, hand over fist and DL decided not to invest any more money into it.

Also, many PanAm employees went to work for Delta with the acquisition of the routes, before PA folded.



*Quotes are from the website of the Delta Air Lines museum.



"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
User currently onlineAirbusA6 From United Kingdom, joined Apr 2005, 2010 posts, RR: 0
Reply 24, posted (2 years 9 months 2 weeks 6 days 23 hours ago) and read 4497 times:

As an outsider, it seems strange that the 2 iconic brand names Pan Am and TWA, known around the world disappeared. Were the brands so tarnished by the financial struggles and salami slicing, that they were effectively worthless by the end, as if Pan Am had merged with, say Delta or American at the start of derugulation, surely the Pan Am name would have been kept?


it's the bus to stansted (now renamed national express a4 to ruin my username)
25 delta2ual : Maybe. If Carl Icahn hadn't gotten his greedy hands on TWA, who knows what would have happened. TW and PA did, in fact, discuss merging several times
26 ckfred : Certainly, an airline could build its network internally. That takes time, and you probably have to fight a fare war with every new route, in order t
27 bohica : Pan Am's problems started in April 1966. That was when they ordered 25 Boeing 747's. In hindsight it was too many 747's. After the planes were deliver
28 SEPilot : Juan Trippe was a pioneer in many respects, and one of them was as the ultimate "inside operator." First, he was one of the most vocal and influentia
29 panamair : Actually, in 1989, Pan Am, under CEO Tom Plaskett (formerly of AA) made a bold bid for NWA, supported by quite a few banks, etc. That would have been
30 timz : Flight 1 continued, but looks like the almost-RTW flight ended 1982. The 8 Sept 1982 timetable shows a 747 LAX-NRT-HKG-BKK; 4/week it continued BKK-D
31 Post contains images NorthStarDC4M : Pan Am 2 bought Carnival Airlines and basically ran out of money, got grounded and finally was sold to Guilford Transportation (PA3) Pan Am 3 whimpere
32 SEPilot : Guilford Transportation was a railroad to begin with; its principal revenue producing asset was a toll bridge that was the only crossing of the Conne
33 Tango-Bravo : All of which, within a few years, summarily axed the networks for which they had paid big $$$...with the exception of Midway 1 who ceased to exist be
34 wn700driver : They would be indeed. As well, United would have been history sometime before the late 1990s. With no int'l network worth mentioning, there's no way
35 ABQopsHP : Good reading for anyone who loves airline history and Pan Am in particular. The book "SKYGODS The Fall of Pan Am" by Robert Gandt. I have read it 3 ti
36 delta2ual : There are only 3-4 great books on aviation that I couldn't put down-that was one of them!
37 jfk777 : What were the Pan AM employees to do, this group was not well off economically. The last thing they want to do is loose their seniority which is ever
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