5/12/1982: Braniff International Airways is Grounded

‍DALLAS - Today, in 1982, One of the world's most iconic airlines, Braniff International Airways (BN), ceased operations.

Speaking at the time, the airline blamed the half-price fare war it had been embroiled in with American Airlines (AA). This had resulted in ticket prices that undercut BN's lowest fares resulting in significantly lower yields.

Over-Expansion

Also to blame was Braniff's substantial over-expansion following the United States airline Deregulation Act of the 1970s. On December 15, 1978 Braniff announced the "largest single-day increase by any airline in history." This was to its domestic network, adding 32 new routes to 16 new cities and increasing its offering by 50%.

International expansion came in 1979. Two hubs were opened in Boston and Los Angeles to offer new transatlantic and transpacific routes. Meanwhile, the airline also launched flights from Dallas/Fort Worth (DFW) to Amsterdam, Brussels, Frankfurt and Paris.

However, this expansion came at an unprecedented time for the aviation industry. Rising fuel prices and a significant economic downturn left the carrier reporting its first operating loss (US$39 million in 1979) since 1970.

Failed Restructuring

Most of BN's international routes were quickly discontinued, leaving just the DFW to London Gatwick (LGW) rotation by 1981.

Despite numerous restructurings, including simplifying fares and negotiating the sale of its South American routes to Eastern Airlines (EA), losses continued.

The airline's then CEO Howard Putnam attempted to get an extension from lenders and creditors on its debts of US$733.2 million. Despite the 39 private lenders agreeing to withhold the payment of interest and principal until October 1983, management had no choice but to suspend all of its flights.

BIA-COR Holdings of New York subsequently purchased the carrier's assets to resurrect the airline. However, the plans failed to materialize.

Featured image: In 1978, The only aircraft Braniff on order were 727-200s and 747s. The director of public information in the Braniff PR department 1978-1981, recalls one executive commenting later that "we'd lost so much money on the expansions that we couldn't afford to buy replacements" for the Douglas DC-8.