There are good weeks. There are bad weeks. And then there are weeks that just suck the life out of you. That’s what the airline industry went through this week.

Monday
Aloha Airlines announced it would cease operations on Tuesday, March 31. The 60-year old airline had filed for bankruptcy 10 days earlier; it had previously filed for bankruptcy in 2003. Aloha had had difficulty matching the low fares offered by go!, a discount airline that started flying between the Hawaiian Islands in June, 2006. go! offered fares as low as $19 on the inter-island routes. One year later go! offered $1 fares to celebrate its first anniversary.

Aloha’s closure leaves go! and Hawaiian Airlines as the main inter-island carriers. Hawaiian, like Aloha did, offers service to several locations on the mainland.

Tuesday
Talks collapsed in Air France/KLM’s bid to take over troubled Alitalia Airlines. The Franco-Dutch conglomerate planned to buy the 49.9 per cent share in Alitalia owned by the Italian government, but talks failed when Alitalia’s unions submitted a proposal that Air France/KLM found unacceptable. In response to the collapse, Alitalia’s chairman, Maurizio Prato, resigned.

Alitalia is losing one million Euros a day and is expected to file bankruptcy and cease operations within the next 60-90 days if there is no solution. If it shuts down, it will join two other national carriers, Swissair (Switzerland) and Sabena (Belgium) that have failed.

Wednesday
ATA files for bankruptcy and ceases operations effective Thursday.

The majority of ATA ‘s business came from flying charters, many for the American military. It also offered scheduled flight service between Hawaii and four west-coast cities. It offered a code-share with Southwest Airlines that gave Southwest passengers a way to fly to Hawaii.

All 2,300 ATA employees were notified that their positions had been eliminated.

With the loss of ATA and Aloha Airlines and their flights, industry analysts expect an increase in air fares to Hawaii. Hawaiian Airlines is trying to fill the void, announcing that it will begin service between Honolulu and Oakland, California in May.

Friday
Congress holds hearings into relationships between the Federal Aviation Administration (FAA) and Southwest Airlines. The FAA had earlier fined Southwest over $10 million for flying aircraft that were late on their inspections.

In the hearings it was revealed that Bobby Boutris, an FAA inspector had uncovered problems with the FAA’s oversight of Southwest Airlines in 2003. His efforts to correct the problem not only went no where, but he lost his his position with the FAA, had to deal with retaliation and scorn from many of his co-workers, and even received an anonymous death threat. The hearings confirmed that the FAA had been too “friendly” with the airlines it was supposed to regulate; Boutris received a written apology from US Transportation Secretary Margaret Peters. (read the complete article in the Dallas Morning-News.)

Saturday
American Airlines (AA) announced a hiring freeze on new employees. Anyone offered a job before April 1 would still be hired, but there would be no additional new hires. The move was in response to American’s growing budget problems caused by rising fuel costs. AA predicts its fuel costs for the year will be $9.3 billion, up 39 per cent from the year before.

Champion Air, a charter carrier, announced it would cease operations on May 31.

All in all, a bad week with three airlines going out of business, one ready to, and deficiencies in the way that air safety is regulated. The good news is that air travel remains safer now than it has ever been. And after what happened this week, it will get safer as the FAA more strictly enforces its oversight role. We may see more situations like we saw last week when American Airlines canceled hundreds of flights so it could conduct needed inspections, but if that is what it takes to make air travel safer, then we all benefit from it.