The story of business class-only airlines took further twists this summer, with sad news of the demise of SilverJet, contrasted with BA's launch of a Paris based-subsidiary called Openskies, targeting the French transatlantic business market.

SilverJet ceased trading at the end of May, after it failed to complete a further refinancing package, the need for which was driven by the massive increase in fuel prices over recent months. Its demise is the final chapter in the story of the three business class airlines (the others being Eos and MaxJet) that launched in Autumn 2006, with the aim of offering an alternative for long-haul commercial travellers. SilverJet had been the most progressive and most marketing-savvy of the three, creating a real alternative to the likes of BA and Virgin and building a strong brand in its 18 months of operation.

However, oil prices made all this good work academic. Tom Otley, editor in chief of Business Traveller magazine, points out that the cost of fuel has been a massive problem for the whole industry. “The airlines are being slaughtered by the cost of oil. Its rise has been both rapid and unpredictable. It's been a bloodbath.” He claims it was not just the independent carriers that did not predict or therefore prepare for this change, and in this respect SilverJet were victims of changing circumstances of the most extreme kind.

Sound proposition

Perhaps because of a vague sense of injustice, or because of fondness for the SilverJet brand, there remains a degree of sympathy for the airline amongst marketing commentators, and what it was trying to achieve. “It was an interesting proposition – business-class only but at an affordable price,” says Simon Bailey, UK MD at The Brand Union. “I liked the idea of an airline that understood the stresses and strains of a business traveller and was trying to make life easier for them.”

But if the proposition was good, why did it fail? Bailey believes it had deeper issues than the cost of fuel. “The problem it had was simple dynamics: it had to fly from places that were less frequently used by business people. These airports are perceived as being more difficult to access. You either have to break people's habits or incentivise them to change.”

French connection

Meanwhile, BA has learned from the business-only startups. Not only did it launch Openskies, a Paris-based subsidiary serving the transatlantic business market, but it followed this up in July by acquiring independent competitor L'Avion for a staggering £54 million.

Even though BA will merge the acquisition into its existing operation, the move still represents a surprising u-turn on BA's policy of not operating separately branded subsidiaries. Bailey says this could be because BA believes its core brand is a turnoff to its largely French customer base. “It may feel it needs a local brand for this market,” he says. “Provenance does matter.”

Otley, meanwhile, suggests there are more cynical motivations, pointing out that BA has high costs associated with its UK-based operations, which have already been the focus of lengthy battles with unions. BA might see operating a subsidiary, with a different business plan and costs, as a potential solution to this issue.

Whatever BA's motivations, all observers are clear that – given the current climate – the marketing messages which airlines will be using to target business people will be increasingly price-focused for the foreseeable future.

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