U.S. East coast shuttle: The PAN AM Shuttle
PAN AM Boeing 727-200 at LaGuardia airport (New York) for its PAN AM Shuttle Service (1987)
In an attempt to gain a presence on the busy Washington–New York–Boston commuter air corridor, the Ransome acquisition was accompanied by the $100 million purchase of New York Air’s shuttle service between Boston, New York, and Washington, D.C. This parallel move was intended to enable Pan Am to provide a high-frequency service for high-yield business travelers in direct competition with the long-established, successful Eastern Air Lines Shuttle operation. The renamed Pan Am Shuttle began operating out of LaGuardia Airport’s refurbished historic Marine Air Terminal in October 1986. However, it did not address the pressing issue of Pan Am’s continuing lack of a strong domestic feeder network.
In 1980, airline industry entrepreneur Frank Lorenzo, through his holding company Texas Air Corporation, formed startup, non-union airline New York Air. Operations commenced on December 19, 1980 with hourly shuttle service between New York LaGuardia, Washington National, and Boston Logan airports in direct competition with the long-established, successful Eastern Air Lines Shuttle. Launched with McDonnell Douglas DC-9 series 30 aircraft, New York Air later added larger DC-9 Super 80s to its fleet. Just over five years later, in February 1986, Texas Air Corporation acquired debt-laden Eastern Air Lines and its shuttle operations. As a condition of the sale, the government required Texas Air to divest New York Air’s takeoff and landing rights at LaGuardia and Washington National. Pan American World Airways purchased them, along with gates at LaGuardia’s historic Marine Air Terminal, for $76 million. The rechristened Pan Am Shuttle launched on October 1, 1986 with dedicated crews, a fleet of Boeing 727 aircraft, and a newly renovated Marine Air Terminal. Though Pan Am suffered a precipitous financial decline in the ensuing years, culminating in the airline’s January 1991 bankruptcy filing, the shuttle operation remained profitable. Delta Air Lines purchased Pan Am Shuttle (including several Boeing 727s) for $113 million, thereby securing Delta’s position as the third largest U.S. airline. Delta relaunched the service under the Delta Shuttle brand on September 1, 1991.