Silverjet: The rapid rise and fall of a business class-only airline

By Felix Lowe

The world's last major business-class only airline, Silverjet, has been forced to suspend its operations after a multi-million-pound cash injection from investors failed to materialise. Here is a timeline that charters the rapid rise and fall of the carrier.

October 2006: Silverjet, a third low-cost business class airline, joins MaxJet and Eos, two American-based carriers which began flying from Stansted in 2005, in what is becoming a rapidly expanding market.

Silverjet launches in Jan 2007

Two Boeing 767 jets with 100 business class seats will fly two daily flights between Luton and Newark airport, New York, for just £999.

Tickets are more expensive than Eos (£773) but considerably cheaper than MaxJet (£1,765). Silverjet planes stand out for their award-winning, fully reclining 6'3" beds with a crew-to-passenger ratio of 1:10. Plans are for a 10-plane fleet "in the next three to five years", according to chief executive Lawrence Hunt.

November 2006: Silverjet claims it will be the first carbon-neutral airline, a move which will see the carrier named the "Environmentally Aware Airline 2007" by the Institute of Transport Management.

December 2006: Silverjet warns that not every airline in the sector will keep flying - this comes a month before the carrier's inauguration flight.

January 25th 2007: Silverjet's first flights to New York take to the sky with tickets sales exceeding forecasts.

April 2007: Forward bookings beat expectations in March, only the second full month of operation; carrier plans to raise £24.6m through a share placing.

May 2007: Both MaxJet and Eos announce they are increasing sizes of fleets and adding routes. Silverjet is set to double its fleet to four planes.

An industry source tells the Telegraph that things are looking positive for the three carriers: "It looks as if they are starting to have an impact on the ticket prices of the big guys."

MaxJet says its load factors are running at 75pc, ahead of predictions, but make no comment on whether or not it was running on a profit.

Silverjet's load factors stand at 62pc, marking a third month of growth.

Eos are running in the mid 60s, with Jack Williams, Eos chief executive, admitting: "We are not profitable right now, but in 2008 we will be there."

Silverjet shares struggle

July 2007: Shares in Silverjet tumble 16pc after the company halts the introduction of a second daily London-New York flight due to a technical problem with one of its two aircraft. Second service plans are put on hold until mid-September; more than 1,000 passengers are given new flights or refunded - at considerable cost.

Mr Hunt shrugs off teething problems: "All start-ups and established airlines have these issues. In the big picture we're doing extremely well and are significantly ahead of our business plan. Forward bookings are doing well and we're proving how our popular service is."

August 2007: Silverjet shares nosedive to a new low after the announcement that it was withdrawing from the chartered flights market. Mr Hunt plays down the news: "There is an overreaction. We have a 76pc load factor which we have achieved in five months and we do not think any airline has done that."

September 2007: Shares jump 17½ to 91p after The Sunday Telegraph reported that Silverjet is in talks about a possible link-up with one of the major European carriers. Mr Hunt plays down talk of a take-over from Air France.

Silverjet announces plans for a new London Luton-Dubai service in November, believing the route offers more protection from the current credit crunch than a second flight to the US.

October 2007: Business class only airlines hit by a doubling of air passenger duty in Alistair Darling's pre-Budget report.

December 2007: Eos and Silverjet say they are trading in line with expectations. Festive cheer is not so free-flowing at MaxJet, however, as CEO and founder William Stockbridge declares the Aim-listed airline bankrupt on Christmas Eve, four years after its inception.

Silverjet passenger numbers rise 12pc as a result of MaxJet's collapse.

January 2008: Mr Hunt bans Ken Livingstone from Silverjet flights after the then London Mayor says his flight to New York with the carrier was "the worst of my life". More bad news as load levels drop to 54pc, growth fails to meet forecasts and shares drop 23pc.

February 2008: Pressure mounts on Silverjet and Eos as BA announces plan to launch a business class only service flying from City Airport to New York from 2009.

Silverjet CEO Lawrence Hunt

April 2008: A contract with American Express, one the world's largest corporate travel agencies, helps lift Silverjet passenger numbers by 23pc.

Mr Hunt remains bullish: "This is solid progress towards our objective of becoming profitable as quickly as possible in a difficult market."

Silverjet shares, which have lost 90pc of their value in a year, rise 40pc on latest takeover talks.

Meanwhile, lone rival Eos files for bankruptcy.

A relieved Hunt reveals £12.7m of emergency funding from an unnamed investor. "It's great news for us. Our sales were up 300pc on Monday. The issue we've had over the last three or four months has been confidence, but we've got a huge opportunity now that our two main competitors have fallen by the wayside."

May 2008: Silverjet is forced to suspend its shares from trading following news that it has not received part of the pledged investment.