PJ McGoldrick was a former chief executive of Ryanair from 1987 until 1991. At the time, Ryanair was still a full-service airline but struggled to make a profit.
After leaving the carrier and allowing Michael O’Leary to take the helm, McGoldrick established a new airline called TransAer International, which commenced operations in February 1992.
The charter carrier operated a varied fleet, including Airbus A300B4s, A320s, Boeing 727s, 737s and 757s, and a Douglas DC-8. When it folded on October 20, 2000 with the loss of 450 jobs, TransAer had debts of over €30 million.
EUjet Is Born
But McGoldrick wasn’t done with the aviation world. In early 2003, along with his son Stuart as Chief Executive Officer, he established EUjet, a collaborative venture with Europe’s largest aircraft lessor, Debis AirFinance, part of the DaimlerChrysler group.
With its HQ at Shannon Airport, the Republic of Ireland, the airline initially operated charter flights for European tour operators out of Dublin, Shannon and Birmingham. It also provided aircraft and crew to fly scheduled services for Air France, Lufthansa’s low-cost airline Germanwings and Italy’s biggest low-cost carrier, Volare.
But in 2004, EUjet decided to spread its wings and establish itself as a low-cost carrier based at Manston Airport in Kent. The initial deal signed in February saw plans for 29 routes from the newly established facility, now known as ‘Kent International,’ lifting passenger numbers from 300,000 in the first year of service to two million by the end of year three. Management made arrangements to expand the existing passenger terminal facilities to support EUjet’s operation and planned growth.
However, EUjet was slow to initiate the new routes due to start in June and rumours circulated that the carrier was suffering financial difficulties. To ensure the planned flights would commence, airport owner PlaneStation subsequently invested £2 million for a 30% stake in the airline in May 2004.
An EUjet spokeswoman commented: “There was no problem with funding; we delayed the launch because of negotiations with overseas airports.”
A Promising Start
Billing itself as a ‘hassle-free alternative’ to its low-cost competitors flying from bigger airports, initial bookings looked promising. The airports then Managing Director Mike Halper said that numbers were ‘ahead of expectations.’ 60 cabin crew had been recruited, with plans to add a further 90 staff by October.
The company also planned to offer weekend scheduled services from Shannon to Faro, Malaga, Murcia and Geneva during the skiing season, plus three daily return flights between Dublin and Shannon airports.
McGoldrick said: ”This is a very exciting development for EUjet. The launch of our new service from Shannon will give consumers in the region access to a range of business and leisure destinations at low and very competitively priced fares. It will also create great access to the Mid/South West region. The existing schedule on the Dublin-Shannon route has meant that it has been impossible for people to fly to Dublin, or from Dublin to Shannon, spend a productive day there, and return again by air the same day. The launch of the new service should be good for business and good for the local economy in this region.”
Sadly the Shannon to Dublin flight never took off, citing Aer Lingus’ decision to continue operating the route as the main factor. EUjet had previously held discussions with senior Aer Lingus executives, which Aer Rianta arranged, to secure an agreement whereby Aer Lingus would cease selling seats to make it viable for the new carrier.
EUjet chief executive, PJ McGoldrick said Aer Lingus had agreed to review the route. They had indicated that it would give the new airline a two-month lead-in time to market itself. But this never happened.“We do not intend to get into competition with Aer Lingus and at this point can only make a decision that we will not start on that route,” he later told The Irish Times.
Taking To The Skies
Services from Kent International commenced on September 1, 2004 when Eujet’s first flight took off at 06:15am bound for Dublin, operated by a 108-seat Fokker F100. Flights on day one were 75 per cent full, with more than 600 passengers flying to Amsterdam, Copenhagen, Dublin, Nice and Girona. By the end of the year, EUjet planned to be flying to 22 destinations, including Prague, Madrid, Milan, Palma, Malaga, Turin, Edinburgh and Manchester.
The PlaneStation Group also announced their intention to purchase the remaining 70% of shares in the business completed by January the following year and making them the only airport in the world to own an airline.
Describing the deal as ‘the final piece in a jigsaw to develop a new low-cost airline model,’ McGoldrick said: “This means that there will only be one company making profits rather than two and that has to be good for travellers. Many other budget airlines have contacts with airports which allow them to offer low cost flights. When those contracts run out there are sometimes problems keeping the prices down.This deal ensures that this will not happen and that EUJet will be able to continue to offer low cost flights.”
In October 2004 Eujet had added flights to Glasgow, Edinburgh, Manchester, Madrid, Malaga, Murcia in Spain, Palma and Shannon. However, Milan and Copenhagen had been quietly dropped from the schedule.
But the carrier was struggling. Shares fell steeply in the fledgling airline in December 2004 when they announced six-month losses of £6.5m and confirmed it was not making enough money at Manston and its other airports to cover operating costs.
Bosses began to review the business plan and revealed they needed a capital injection of no less than £22 million to fund the airline’s development and achieve its long term strategy.
PlaneStation announced that 71,000 passengers had flown with EUJet in the first 13 weeks of operation, with total bookings standing at 151,000.
A code-sharing deal was signed in June 2005 with Czech airline Smart Wings. This agreement meant Smart Wings passengers would now be carried on one of Eujet’s three flights a week between Kent and Prague.
Twenty-six destinations were to be served for the summer 2005 season. However, Madrid and Glasgow were dropped, and plans were postponed for a new route to Cologne.
On July 8, 2005 EUjet welcomed its 300,000th passenger. Stuart McGoldrick, group commercial director, said: “During our first ten months we have, as expected, experienced a number of highs, including the launch of the summer schedule, improved customer service thanks to the JetText service, and plenty of positive feedback from passengers. Improvements in our performance have seen on-time arrivals hit 92 per cent in April and 90 per cent in May, standards which our rivals at other South East airports can only dream of.”
The carrier estimated that it would carry some 600,000 passengers in 2005. But during May 2005 it carried just 36,000 passengers, filling only 55% of its available seats.
On July 26, 2005 the airline filed for voluntary administration after its owner PlaneStation went out of business with €40 million in debts. The carrier had four F100s and was flying to 18 destinations. Lack of passengers was one reason for the airline’s failure, with only 330,000 out of the 500,000 passengers predicted for the first year of operation.
In a statement to staff, Eujet chief executive PJ McGoldrick said PlaneStation had failed to secure further funds from its bank and could not keep Kent International Airport operational.
He said: “Therefore, it is with regret that I must advise you that Eujet has had no alternative but with immediate effect to suspend all airline operations and appoint an administrator in Ireland.” McGoldrick explained that Eujet’s operations from Shannon in Ireland had “exceeded all expectations”, but an under-performance in Kent alongside high fuel prices and other factors “resulted in an irresolvable conclusion for the Group”.
Rival airlines immediately stepped in, offering to fly over 5,000 passenger stranded across Europe following its demise.
EUjet came at the wrong time with the wrong type of aircraft, which were plagued with reliability problems causing extensive disruption and a lack of trust from passengers. This, despite the onboard product – allocated seating, hassle-free check-in and boarding etc, being greatly received.
The carrier rapidly over-expanded, adding too many routes without investing enough in marketing and branding. In the previous few years, more than 20 budget airlines across Europe went as quickly as they came, all wanting to emulate the success of easyJet and Ryanair.
One of these was Debonair and you can read more about this low-cost pioneer here.
EUjet operated the following services (at July 2005):
- Ireland domestic destinations: Dublin and Shannon.
- UK destinations: Belfast, Edinburgh, Manchester, Kent International Airport and Newcastle.
- International scheduled destinations: Alicante, Amsterdam, Faro, Geneva (ski seasonal destination), Girona, Ibiza, Innsbruck, Málaga, Murcia, Nice, Palma de Mallorca, Prague, Salzburg and Valencia.
N.B. The author does not own the rights to any of the images included in this article unless otherwise stated.
© Jet Back In Time by Lee Cross.