Several airlines that were once very popular with air travelers have disappeared from the landscape of operational air carriers. Financial problems have been the demise of many major airlines, while labor problems, increased competition, and plane crashes doomed others.

Key Takeaways

  • As deregulation and accidents occur once-thriving airlines find themselves struggling for market share culminating in acquisition by rivals or closure.
  • United Airlines, American Airlines, and Delta Air Lines capitalized on favorable changes in the market that allowed them to grow, thrive, and survive.
  • Pan American World Airways (Pan Am) and Trans World Airlines (TWA) struggled to survive in the rapidly expanding market while finding airplane crashes in 1988 and 1996 respectively too much to overcome.
  • The debt incurred by Eastern Air Lines' decision to differentiate themselves from other airlines through the purchase of Boeing 757 jets coupled with labor issues and the competition was too much for the airline to survive.
  •  While mergers and acquisitions grounded once-prominent air carriers, the advances made and risks taken by these defunct airlines are reflected in today's leading carriers.

Pan American World Airways

Pan American World Airways was once one of the most recognized airlines in the world. Pan Am was a founding member of the International Air Transport Association (IATA) and the main international air carrier in the United States for more than half a century, from 1930 to 1990. Pan Am was considered one of the most luxurious airlines to fly during the 1950s and 1960s.

The airline's fortunes started declining in the 1970s when deregulation led to increased competition from other carriers, accompanied by a marked increase in fuel prices and declining international travel. Whether Pan Am could have weathered the financial storm will never be known; the airline was permanently grounded by the infamous 1988 Lockerbie crash of Pan Am Flight 103, the result of a terrorist bombing that killed 259 passengers and crew and 11 members of the ground crew. The airline struggled along for three more years, mostly by selling off assets, but it was financially defunct by the end of 1991.

Key Takeaways

Despite the closure of Pan Am airline, the brand lives on in pop culture and fashion—ABC aired Pan Am, a fictionalized drama featuring the airline, in 2011 and a pop-up bar featuring the brand was open in downtown Cincinnati in October 2019.

Trans World Airlines

Pan Am's major U.S. competitor in international flights, Trans World Airlines, or TWA, has not survived either. Originally founded in 1925 as a different airline company with the same initials—Transcontinental and Western Air—TWA became a major international air carrier after its acquisition by billionaire Howard Hughes in 1939. TWA was, like Pan Am, known as a luxury carrier and considered to be at the cutting edge of technological innovation in air travel.

However, the airline had difficulty borrowing money with Hughes at the head of the company, and it nearly went bankrupt in the early 1960s. TWA seemed to recover after Hughes relinquished control, but it was then hit by the deregulation and fuel cost crises of the 1970s. Additionally, the company's management attempted to diversify by acquiring Hilton International and Century 21 properties.

During the 1980s, TWA experienced increasing financial problems that eventually resulted in the airline declaring bankruptcy in 1992 and then again in 1995. Then, like Pan Am, TWA suffered from a major crash resulting in the death of 230 passengers and crew, that of Flight 800 in 1996. The airline continued to struggle until it was once again forced into bankruptcy in 2001, when it was acquired by American Airlines.

Eastern Airlines Air Lines

Eastern Airlines Air Lines was once the predominant eastern Eastern U.S. airline, although it was eventually hurt by increasing competition from United, Delta and some smaller regional carriers. Founded in 1926, Eastern was one of the earliest major U.S. air carriers.  carriers, founded in 1926, headquartered Headquartered in Miami, and for a time headed by famous WWI flying ace Eddie Rickenbacker. From 1930 through 1950, it enjoyed a near monopoly on passenger air travel along the Florida to New York corridor. Eastern notably pioneered air shuttle service, established between New York and Washington, D.C. and New York and Boston.

In the 1960s, competition with United and other airlines began heating up and negatively impacting Eastern's revenues. Once known for its Douglas DC-8 aircraft, Eastern was the first airline to obtain the Boeing 757 jets. Unfortunately, the massive debt created by the purchase of 757s added to already existing financial problems for Eastern. The 1980s saw Eastern also burdened by labor problems, including strikes, and increased competition. Eastern filed for bankruptcy in 1989 and from there stumbled its way to extinction when it ceased operating in 1991.

Northwest Airlines

Northwest Airlines has also disappeared from the air travel landscape, but it suffered a less ugly end than Pan Am, TWA and Eastern, disappearing through a friendly merger with a larger carrier.

Northwest began operations as a Minneapolis-based air mail carrier in 1926, adding passenger operations in 1927. The airline eventually expanded to operating nationwide in the U.S., and then internationally, providing flights to the Asia Pacific region under the name Northwest Orient. The company further expanded its international operations through a strategic joint venture partnership established in 1993 with major European carrier KLM. Northwest merged with Delta Air Lines in 2008.

Continental Airlines

Continental Airlines was originally founded in 1932 as Varney Speed Lines, transporting mail and passengers in the Southwest. The airline soon began offering flights to Mexico as well. Continental expanded operations significantly in the 1950s following its acquisition of Pioneer Airlines, establishing a Los Angeles hub in the 1960s and pioneering economy fares between Chicago and Los Angeles.

Like many other airlines, Continental was hurt by deregulation and labor troubles and eventually had to declare bankruptcy in 1983. Continental emerged from bankruptcy with increased profit margins from reduced labor costs, and it established a Newark hub for flights to Europe. After adding service to other international destinations in the 1990s and 2000s, Continental merged with United Airlines by means of a stock swap in 2010, a deal that at the time made United the largest passenger airline in terms of revenue passenger miles.