WEBVTT 00:00:00.000 --> 00:00:04.059 Imagine this for a second. It's a 1965. You're 00:00:04.059 --> 00:00:06.879 a business person in New York City and you need 00:00:06.879 --> 00:00:10.599 to get to D .C. for a meeting. But you don't 00:00:10.599 --> 00:00:12.500 have a ticket. You don't have a reservation. 00:00:12.779 --> 00:00:14.939 No code on your phone. You haven't even talked 00:00:14.939 --> 00:00:17.820 to a travel agent. That sounds, I mean, for a 00:00:17.820 --> 00:00:19.480 modern traveler, that's basically a nightmare 00:00:19.480 --> 00:00:21.519 scenario. You just show up at the airport with 00:00:21.519 --> 00:00:23.539 no confirmation. You'd be sleeping in the terminal. 00:00:23.800 --> 00:00:26.879 Exactly. But in this world, you just grab your 00:00:26.879 --> 00:00:30.199 briefcase, you hail a cab to LaGuardia, and you 00:00:30.199 --> 00:00:33.979 walk right up to a specific terminal. And you 00:00:33.979 --> 00:00:36.039 just get on a plane. Just like that. Just like 00:00:36.039 --> 00:00:38.299 that. And here's the part that sounds like complete 00:00:38.299 --> 00:00:42.119 fiction. If you get to that gate. And the plate 00:00:42.119 --> 00:00:44.939 is totally full. Every single seat. The airline 00:00:44.939 --> 00:00:46.780 doesn't bump you. No voucher to fly tomorrow. 00:00:47.060 --> 00:00:49.539 No voucher. They just roll out another jet. A 00:00:49.539 --> 00:00:52.000 whole other airliner. They crew it. They fuel 00:00:52.000 --> 00:00:54.740 it. And they fly it to your destination. Even 00:00:54.740 --> 00:00:56.799 if you are the only soul on board. That sounds 00:00:56.799 --> 00:00:58.780 impossible. It sounds like a business model designed 00:00:58.780 --> 00:01:01.780 to just burn cash. But that was real. It was 00:01:01.780 --> 00:01:03.979 real. That was the air shuttle. And it was just 00:01:03.979 --> 00:01:06.379 standard procedure for a company that was at 00:01:06.379 --> 00:01:10.519 one time a titan of American industry. We're 00:01:10.519 --> 00:01:13.439 talking about Eastern Airlines. We are. And when 00:01:13.439 --> 00:01:16.299 we say Titan, that's not an exaggeration. Today, 00:01:16.560 --> 00:01:18.640 you know, we think of the big three, Delta, United, 00:01:18.879 --> 00:01:22.700 American. But for a huge chunk of the 20th century, 00:01:23.079 --> 00:01:25.680 Eastern was a charter member of the big four. 00:01:25.760 --> 00:01:28.680 Oh, absolutely. They were the bedrock. To really 00:01:28.680 --> 00:01:30.560 get the scale of Eastern, you have to understand 00:01:30.560 --> 00:01:33.180 they weren't just a player in the market. For 00:01:33.180 --> 00:01:35.680 decades, they were the market for anyone flying 00:01:35.680 --> 00:01:38.159 from the Northeast to Florida. They owned the 00:01:38.159 --> 00:01:41.280 East Coast. Massive brand recognition, huge assets, 00:01:41.480 --> 00:01:43.799 a near monopoly on some of the most lucrative 00:01:43.799 --> 00:01:46.299 routes in the entire world. And yet they completely 00:01:46.299 --> 00:01:48.560 vanished. And that's the hook for today's deep 00:01:48.560 --> 00:01:51.140 dive. We've got a massive stack of sources in 00:01:51.140 --> 00:01:53.780 front of us. Fleet records, biographies of World 00:01:53.780 --> 00:01:57.480 War I aces, NTSB accident reports, financial 00:01:57.480 --> 00:02:00.219 autopsies. You name it. A little bit of everything. 00:02:00.379 --> 00:02:03.180 Our mission today is to figure out how a company 00:02:03.180 --> 00:02:06.060 goes from being the wings of man, sponsoring 00:02:06.060 --> 00:02:09.099 Disney World, and just dominating the skies to 00:02:09.099 --> 00:02:13.169 a chaotic sudden collapse in 1991. It's a real 00:02:13.169 --> 00:02:15.050 tragedy in three acts. I mean, you've got the 00:02:15.050 --> 00:02:18.129 rise under a war hero, this incredible period 00:02:18.129 --> 00:02:21.789 of innovation, and then this slow, painful death 00:02:21.789 --> 00:02:25.250 spiral of debt, labor wars, and corporate raiders. 00:02:25.409 --> 00:02:28.189 It's got everything. Celebrity pilots, huge technological 00:02:28.189 --> 00:02:30.710 gambles that just didn't pay off. And some just 00:02:30.710 --> 00:02:32.889 bizarre stories. We have to talk about the Moonlight 00:02:32.889 --> 00:02:35.389 specials. Oh, we will. And pranks with hidden 00:02:35.389 --> 00:02:37.539 cameras. Yeah. So let's unpack this. We have 00:02:37.539 --> 00:02:39.500 to start at the very beginning. Because before 00:02:39.500 --> 00:02:42.080 it was a corporate giant, it was, well, you said 00:02:42.080 --> 00:02:44.039 it earlier, it was basically a mail truck with 00:02:44.039 --> 00:02:46.719 wings. That's a pretty fair description. To understand 00:02:46.719 --> 00:02:49.060 Eastern, you have to go back to the late 1920s. 00:02:49.099 --> 00:02:51.080 The company's DNA really starts with the three 00:02:51.080 --> 00:02:53.580 smaller outfits, but the main one was Pitcairn 00:02:53.580 --> 00:02:56.479 Aviation. Pitcairn Aviation. It just sounds like 00:02:56.479 --> 00:02:58.879 a barnstorming name from an old movie. And it 00:02:58.879 --> 00:03:01.780 essentially was. This guy, Harold Pitcairn, was 00:03:01.780 --> 00:03:05.740 an aviation pioneer. In 1927, his company won 00:03:05.740 --> 00:03:08.000 a government contract to fly mail between New 00:03:08.000 --> 00:03:10.280 York and Atlanta. And we should probably clarify 00:03:10.280 --> 00:03:13.439 for you listening. In the 1920s, airlines were 00:03:13.439 --> 00:03:15.849 not... really about passengers. No, passengers 00:03:15.849 --> 00:03:18.389 were just extra weight. A nuisance. They complained 00:03:18.389 --> 00:03:21.409 they needed seats. Mailbags don't complain. Exactly. 00:03:21.789 --> 00:03:24.789 The money was in government mail contracts. So 00:03:24.789 --> 00:03:27.310 Pitcairn was flying these little mail wing biplanes, 00:03:27.530 --> 00:03:30.590 open cockpits, pilots navigating by following 00:03:30.590 --> 00:03:33.129 railroad tracks or literal bonfires on the ground. 00:03:33.330 --> 00:03:35.129 It's just incredible to think that modern travel 00:03:35.129 --> 00:03:37.270 started with guys in leather helmets freezing 00:03:37.270 --> 00:03:40.189 in an open cockpit. So we've got mail planes. 00:03:40.449 --> 00:03:42.490 How do we get from that to the Great Silver Fleet? 00:03:42.689 --> 00:03:44.990 Well, as always money changes hands. The aviation 00:03:44.990 --> 00:03:47.250 industry back then was like the dot -com boom. 00:03:47.370 --> 00:03:49.750 Everyone was buying everyone. A guy named Clement 00:03:49.750 --> 00:03:52.289 Keyes, who owned North American Aviation, bought 00:03:52.289 --> 00:03:55.650 Pitcairn in 1929. Then, General Motors, yes, 00:03:55.750 --> 00:03:58.110 the car company, buys North American. So by the 00:03:58.110 --> 00:04:00.509 mid -30s, this little airline, now called Eastern 00:04:00.509 --> 00:04:03.210 Airlines, is basically just a division of GM. 00:04:03.469 --> 00:04:07.930 Which brings us to 1938 and the arrival of the 00:04:07.930 --> 00:04:11.389 Ace. Eddie Rickenbacker. Eddie Rickenbacker. 00:04:11.389 --> 00:04:13.210 Now, there's a name. This is a guy who almost 00:04:13.210 --> 00:04:16.009 defies belief today. He was the ace of aces in 00:04:16.009 --> 00:04:19.910 World War I, shot down 26 enemy aircraft, a Medal 00:04:19.910 --> 00:04:22.689 of Honor recipient. And before all that, he was 00:04:22.689 --> 00:04:24.949 a race car driver. Yes. He raced in the Indy 00:04:24.949 --> 00:04:28.009 500 multiple times. He even owned the Indianapolis 00:04:28.009 --> 00:04:30.529 Motor Speedway later on. The guy was just built 00:04:30.529 --> 00:04:32.790 for speed and risk. But as a businessman, he 00:04:32.790 --> 00:04:36.339 was. Surprisingly conservative. Incredibly conservative, 00:04:36.540 --> 00:04:39.000 which is fascinating. So GM owns the airline 00:04:39.000 --> 00:04:41.879 and Rickenbacker is running it for them. But 00:04:41.879 --> 00:04:43.740 he wants to own it himself. Right. He doesn't 00:04:43.740 --> 00:04:45.240 want some other company coming in and chopping 00:04:45.240 --> 00:04:48.939 it up for parts. Exactly. In 1938, GM was under 00:04:48.939 --> 00:04:50.660 some antitrust pressure from the government, 00:04:50.759 --> 00:04:52.860 so they were looking to sell. Rickenbacker saw 00:04:52.860 --> 00:04:55.500 his chance. So he goes to fundraise. And the 00:04:55.500 --> 00:04:57.759 sources describe this. It's like a scene from 00:04:57.759 --> 00:05:00.189 a movie. He walks in to see Alfred P. Sloan, 00:05:00.189 --> 00:05:02.230 the head of GM. You can just picture it. The 00:05:02.230 --> 00:05:05.750 heavy oak furniture, the cigar smoke. Rickenbacker 00:05:05.750 --> 00:05:08.990 and his associate, Sidney Shannon, walk in. And 00:05:08.990 --> 00:05:11.629 he doesn't offer a handshake deal or a promissory 00:05:11.629 --> 00:05:14.009 note. He puts a certified check on the desk. 00:05:14.189 --> 00:05:18.310 A check for $3 .5 million. Which, if you adjust 00:05:18.310 --> 00:05:20.709 for inflation, is somewhere around $78 million 00:05:20.709 --> 00:05:23.910 today. It was massive sum. He just hands it over. 00:05:24.370 --> 00:05:27.449 Sloan takes it. And just like that, Eastern Airlines 00:05:27.449 --> 00:05:30.189 is an independent company. And Rickenbacker is 00:05:30.189 --> 00:05:32.350 in charge. He ran that airline with the same 00:05:32.350 --> 00:05:34.209 discipline he'd use in a fighter cockpit. He 00:05:34.209 --> 00:05:37.269 did. And under his leadership, Eastern became 00:05:37.269 --> 00:05:39.670 the most profitable airline in the post -war 00:05:39.670 --> 00:05:43.370 era. And fascinatingly, they never needed a state 00:05:43.370 --> 00:05:45.389 subsidy. That was his whole thing. It was his 00:05:45.389 --> 00:05:48.389 philosophy. He was a rugged individualist. He 00:05:48.389 --> 00:05:50.970 famously said, I don't want a dime of the taxpayer's 00:05:50.970 --> 00:05:53.850 money. He wanted to win on merit. Most airlines 00:05:53.850 --> 00:05:57.310 back then survived on government handouts. Rickenbacker 00:05:57.310 --> 00:06:00.269 refused. He built what he called the Great Silver 00:06:00.269 --> 00:06:02.649 Fleet. Let's talk about that branding, the Great 00:06:02.649 --> 00:06:05.279 Silver Fleet. It sounds so... elegant, but it 00:06:05.279 --> 00:06:07.139 was really another one of his cost -cutting measures, 00:06:07.240 --> 00:06:10.500 wasn't it? It was pure frugality. Rickenbacker 00:06:10.500 --> 00:06:12.800 looked at the cost of painting a plane. Paint 00:06:12.800 --> 00:06:15.560 has mass. It has weight. On a big aircraft like 00:06:15.560 --> 00:06:18.240 a DC -4, a full coat of paint can weigh several 00:06:18.240 --> 00:06:20.160 hundred pounds. And that's hundreds of pounds 00:06:20.160 --> 00:06:22.300 of fuel you're burning on every single flight 00:06:22.300 --> 00:06:24.379 just to carry the paint around. Precisely. So 00:06:24.379 --> 00:06:27.050 Rickenbacker basically said, scrape it off. They 00:06:27.050 --> 00:06:30.050 polished the aluminum skin of the planes until 00:06:30.050 --> 00:06:32.209 it shone like a mirror. It looked incredible, 00:06:32.350 --> 00:06:34.689 very futuristic. But the real reason was just 00:06:34.689 --> 00:06:37.370 to save money on gas. And they absolutely dominated 00:06:37.370 --> 00:06:40.209 that East Coast corridor. New York, Washington, 00:06:40.550 --> 00:06:44.430 Atlanta, Miami. That geography is so crucial 00:06:44.430 --> 00:06:46.689 to the whole story. We sometimes call it the 00:06:46.689 --> 00:06:48.889 Golden Triangle. I mean, think about it. You 00:06:48.889 --> 00:06:51.209 have the political capital in D .C., the financial 00:06:51.209 --> 00:06:53.370 capital in New York, and the vacation capital 00:06:53.370 --> 00:06:56.110 in Miami. Especially in the winter. The snowbirds. 00:06:56.569 --> 00:06:59.009 If you were a wealthy New Yorker flying to Florida 00:06:59.009 --> 00:07:01.389 in the 40s or 50s, you were almost certainly 00:07:01.389 --> 00:07:04.250 flying Eastern. It was a cash cow. They basically 00:07:04.250 --> 00:07:07.569 printed money on those routes. But, and there's 00:07:07.569 --> 00:07:10.430 always a but, that conservative nature, that 00:07:10.430 --> 00:07:12.769 same frugality that made them so profitable, 00:07:12.970 --> 00:07:15.689 it eventually became a huge liability, didn't 00:07:15.689 --> 00:07:18.550 it? It really did. This is a classic invaders 00:07:18.550 --> 00:07:21.689 dilemma situation. Rickenbacker was a genius 00:07:21.689 --> 00:07:23.949 at running a tight ship with piston engine planes. 00:07:24.269 --> 00:07:27.889 But then came the jet age. The late 50s. The 00:07:27.889 --> 00:07:30.889 Boeing 707. The Douglas DC -8. Right. And Rickenbacker. 00:07:31.459 --> 00:07:33.800 Well, he was skeptical. He looked at these brand 00:07:33.800 --> 00:07:35.980 new jets and just saw dollar signs. They were 00:07:35.980 --> 00:07:38.279 incredibly expensive to buy, and the early ones 00:07:38.279 --> 00:07:41.459 were fuel guzzlers. So his logic was, why would 00:07:41.459 --> 00:07:43.339 I spend all this extra money just to fly people 00:07:43.339 --> 00:07:46.000 to the same place a little faster? Exactly. He 00:07:46.000 --> 00:07:48.399 completely underestimated how much the public 00:07:48.399 --> 00:07:50.819 would love them. He thought people would be happy 00:07:50.819 --> 00:07:53.339 to keep flying slower prop planes if the fare 00:07:53.339 --> 00:07:56.180 was a few bucks cheaper. He bet on frugality 00:07:56.180 --> 00:07:58.819 over speed. That seems like a massive miscalculation. 00:07:59.129 --> 00:08:01.649 Speed is the entire point of air travel. In hindsight, 00:08:01.790 --> 00:08:04.730 yes. Huge miscalculation. But at the time, jets 00:08:04.730 --> 00:08:07.750 were unproven economically. But the public, they 00:08:07.750 --> 00:08:09.610 voted with their wallets. They wanted the smooth 00:08:09.610 --> 00:08:11.949 ride, the speed. They wanted pure jet service. 00:08:12.230 --> 00:08:14.250 Which is what competitors like Delta and National 00:08:14.250 --> 00:08:16.350 started advertising. And they started eating 00:08:16.350 --> 00:08:19.709 into Eastern's market share fast. Which led to 00:08:19.709 --> 00:08:22.329 Rickenbacker's ouster. It did. The board of directors 00:08:22.329 --> 00:08:25.560 realized they were losing the future. By 1959, 00:08:25.860 --> 00:08:29.519 he was pushed out as CEO, and by 63, the ace 00:08:29.519 --> 00:08:32.100 was gone completely. The company had to change. 00:08:32.460 --> 00:08:35.399 So Rickenbacker leaves, and we enter what I think 00:08:35.399 --> 00:08:38.100 is the most culturally significant era for Eastern. 00:08:38.440 --> 00:08:41.799 This is the 1960s and 70s, the Wings of Man era. 00:08:41.980 --> 00:08:44.059 This is when they really try to reinvent themselves 00:08:44.059 --> 00:08:46.720 as a modern, innovative carrier. They had to 00:08:46.720 --> 00:08:48.679 play catch up on jets, but they also introduced 00:08:48.679 --> 00:08:51.220 services that totally changed the industry. They 00:08:51.220 --> 00:08:53.500 moved away from military discipline and hired 00:08:53.500 --> 00:08:56.340 ad agencies. And Orson Welles to do the voiceovers. 00:08:56.480 --> 00:08:59.350 The Wings of Man. It sounds so majestic. It did. 00:08:59.509 --> 00:09:01.990 And it was backed up by real innovation. Let's 00:09:01.990 --> 00:09:04.230 go back to that Eastern Airlines shuttle. I mentioned 00:09:04.230 --> 00:09:05.830 it in the intro, but I want to really dig into 00:09:05.830 --> 00:09:07.750 how this worked because it's just so unique. 00:09:07.929 --> 00:09:11.509 It launched in 1961. The shuttle was. It was 00:09:11.509 --> 00:09:14.309 revolutionary. Before this, flying was an event. 00:09:14.470 --> 00:09:16.710 You booked weeks in advance. You dressed up. 00:09:16.909 --> 00:09:18.830 Eastern looked at the business travel market 00:09:18.830 --> 00:09:20.850 between New York, D .C. and Boston and said, 00:09:20.950 --> 00:09:23.570 let's make it like taking a bus. Hourly flights 00:09:23.570 --> 00:09:27.440 from 7 in the morning to 10 at night. And no 00:09:27.440 --> 00:09:30.120 reservations needed. Think about the logistics 00:09:30.120 --> 00:09:32.580 of that. No reservations. You'd walk into a special 00:09:32.580 --> 00:09:34.399 terminal at LaGuardia. You wouldn't even go to 00:09:34.399 --> 00:09:36.720 a ticket counter. You'd go straight to the gate, 00:09:36.840 --> 00:09:39.000 pull a boarding pass out of a machine like you're 00:09:39.000 --> 00:09:40.860 taking a number at the deli. And you'd just walk 00:09:40.860 --> 00:09:43.320 on the plane. And payment happened in the air. 00:09:43.480 --> 00:09:46.620 Yes. Once you were at cruising altitude, the 00:09:46.620 --> 00:09:48.879 flight attendants would roll a cart down the 00:09:48.879 --> 00:09:52.299 aisle, not with coffee, but with a cash box and 00:09:52.299 --> 00:09:55.480 one of those old credit card imprinters. The 00:09:55.480 --> 00:09:58.379 knuckle busters. They collected fares right there 00:09:58.379 --> 00:10:00.980 in the air. That is just mind -boggling. But 00:10:00.980 --> 00:10:03.159 the wildest part, the thing we mentioned, is 00:10:03.159 --> 00:10:07.059 the guarantee. The 100 % seat guarantee. Their 00:10:07.059 --> 00:10:09.559 promise was, if you showed up by a certain time, 00:10:09.620 --> 00:10:13.580 you got a seat. Period. And they meant it. There's 00:10:13.580 --> 00:10:15.659 this famous story, and it's absolutely true, 00:10:15.799 --> 00:10:18.720 that on one busy weekend, a shuttle flight filled 00:10:18.720 --> 00:10:21.740 up, and there was one single passenger left at 00:10:21.740 --> 00:10:24.009 the gate. One guy. Today, they'd say, sorry, 00:10:24.129 --> 00:10:26.049 there's another flight in an hour. Here's a $10 00:10:26.049 --> 00:10:28.870 food voucher. Right. But Eastern, they pulled 00:10:28.870 --> 00:10:31.370 a backup plane, a Lockheed Constellation, out 00:10:31.370 --> 00:10:33.690 of the hangar. They called in a standby crew 00:10:33.690 --> 00:10:35.889 that was just sitting in the lounge just in case. 00:10:36.129 --> 00:10:39.529 They fueled it up, boarded that one guy, and 00:10:39.529 --> 00:10:41.529 flew him to Washington. That is the ultimate 00:10:41.529 --> 00:10:43.909 customer service flex. It must have cost them 00:10:43.909 --> 00:10:46.990 a fortune. Thousands of dollars in 1960s money. 00:10:47.190 --> 00:10:49.629 But think of the marketing value. That story 00:10:49.629 --> 00:10:52.029 spread through the business community like wildfire. 00:10:52.440 --> 00:10:55.340 It bought them unbelievable loyalty. For anyone 00:10:55.340 --> 00:10:57.440 doing business on the East Coast, the shuttle 00:10:57.440 --> 00:10:59.580 was the only way to travel. And they had the 00:10:59.580 --> 00:11:02.440 look to match it. The hockey stick livery. Iconic. 00:11:02.440 --> 00:11:04.299 One of the greatest of all time. Officially, 00:11:04.299 --> 00:11:07.419 it was Caribbean blue over ionosphere blue. It 00:11:07.419 --> 00:11:09.080 was this shape running up the tail that looked 00:11:09.080 --> 00:11:11.440 just like a hockey stick. And I found this hilarious 00:11:11.440 --> 00:11:13.500 detail. There were two versions because of that 00:11:13.500 --> 00:11:16.480 old paint weight issue. Yes. Rickenbacker's frugality 00:11:16.480 --> 00:11:19.120 lived on. They had the silver hockey stick fleet 00:11:19.120 --> 00:11:21.480 where the main body of the plane was just unpainted, 00:11:21.500 --> 00:11:24.360 polished metal, saved on weight. But then they 00:11:24.360 --> 00:11:27.299 bought Airbus planes. Exactly. Eastern was the 00:11:27.299 --> 00:11:30.690 first U .S. carrier to fly the Airbus A300. But 00:11:30.690 --> 00:11:33.470 the A300 used composite materials, fiberglass, 00:11:33.710 --> 00:11:35.929 carbon fiber. And you can't just polish composite. 00:11:35.970 --> 00:11:38.590 The sun will degrade it. So they had to paint 00:11:38.590 --> 00:11:40.909 the Airbus planes white. So you had the white 00:11:40.909 --> 00:11:43.429 fleet and the silver fleet. Yep. If you saw a 00:11:43.429 --> 00:11:45.629 silver plane, it was a Boeing or a Lockheed. 00:11:45.889 --> 00:11:48.750 If it was white, it was an Airbus. Speaking of 00:11:48.750 --> 00:11:51.450 branding, we have to talk about the mouse. Eastern 00:11:51.450 --> 00:11:54.929 and Disney. A huge partnership. From 1971 to 00:11:54.929 --> 00:11:57.809 1989, Eastern was the official airline of Walt 00:11:57.809 --> 00:12:00.299 Disney World. Walt Disney World opened in Orlando 00:12:00.299 --> 00:12:03.840 in 71, and Eastern was there from day one. Which 00:12:03.840 --> 00:12:05.299 makes sense. They already owned the route to 00:12:05.299 --> 00:12:08.259 Florida. True, but this just cemented it. They 00:12:08.259 --> 00:12:09.940 sponsored a ride in the Magic Kingdom, if you 00:12:09.940 --> 00:12:12.279 had wings. I remember reading about this. It 00:12:12.279 --> 00:12:14.240 was in Tomorrowland, right? Where the Buzz Lightyear 00:12:14.240 --> 00:12:16.500 ride is now. That's the one. It was one of those 00:12:16.500 --> 00:12:19.159 Omnimover rides, like the Haunted Mansion. You'd 00:12:19.159 --> 00:12:21.539 sit in these little plastic shells and just float 00:12:21.539 --> 00:12:24.600 past dioramas of all the places Eastern flew. 00:12:25.340 --> 00:12:28.799 Mexico, Puerto Rico, New Orleans. And that song. 00:12:29.159 --> 00:12:31.600 Oh, that song. If you had wings, you could do 00:12:31.600 --> 00:12:33.940 many things. It was a total earworm designed 00:12:33.940 --> 00:12:35.879 to sell tickets to a captive audience. And the 00:12:35.879 --> 00:12:37.919 ride was free, right? Yeah. Back then, Disney 00:12:37.919 --> 00:12:39.960 had ticket books, you know, A through E tickets. 00:12:40.220 --> 00:12:42.899 But the sponsored rides were free. So families 00:12:42.899 --> 00:12:45.500 would just ride, if you had wings, over and over 00:12:45.500 --> 00:12:47.120 again to sit in the air conditioning. It was 00:12:47.120 --> 00:12:49.299 basically brainwashing an entire generation of 00:12:49.299 --> 00:12:51.639 kids. So they have the business market with the 00:12:51.639 --> 00:12:54.720 shuttle, the family market with Disney. And they're 00:12:54.720 --> 00:12:57.700 also pushing the envelope. on the actual aircraft. 00:12:57.980 --> 00:13:02.440 The Airbus A300, but the big one was the Lockheed 00:13:02.440 --> 00:13:06.379 LT11 TriStar. The Whisperliner. Why Whisperliner? 00:13:06.740 --> 00:13:09.220 It was called that because its engines, the Rolls 00:13:09.220 --> 00:13:12.659 -Royce RB211s, were noticeably quieter than the 00:13:12.659 --> 00:13:16.080 competition. It was a beautiful plane, a wide 00:13:16.080 --> 00:13:18.779 body, three engines, one integrated right into 00:13:18.779 --> 00:13:22.309 the tail with that graceful S -duct. It was technologically 00:13:22.309 --> 00:13:24.470 way ahead of its time. But the development of 00:13:24.470 --> 00:13:27.289 that plane was a total nightmare. It was an absolute 00:13:27.289 --> 00:13:30.149 saga. Rolls -Royce, the engine maker, actually 00:13:30.149 --> 00:13:32.870 went bankrupt trying to develop the RB -211. 00:13:32.990 --> 00:13:34.509 It was too complex. They were trying to make 00:13:34.509 --> 00:13:37.210 these carbon fiber fan blades that just kept 00:13:37.210 --> 00:13:39.210 shattering when birds hit them. So the whole 00:13:39.210 --> 00:13:41.769 L -1011 program was delayed for years. For years. 00:13:42.070 --> 00:13:44.389 Eastern was stuck waiting for their planes. The 00:13:44.389 --> 00:13:46.450 British government had to step in and nationalize 00:13:46.450 --> 00:13:48.789 Rolls -Royce to save it. And Eastern specifically 00:13:48.789 --> 00:13:50.940 had to hold the line. They could have bailed 00:13:50.940 --> 00:13:53.139 and bought DC -10s? They could have, but they 00:13:53.139 --> 00:13:55.360 stuck with Lockheed and Rolls -Royce. There's 00:13:55.360 --> 00:13:57.519 a quote in our source material from Stanley Hooker, 00:13:57.580 --> 00:14:00.139 a famous Rolls -Royce engineer. He said the RB 00:14:00.139 --> 00:14:02.940 -211 program was saved by Eastern's steadfast 00:14:02.940 --> 00:14:05.700 support. They inadvertently saved Rolls -Royce. 00:14:05.840 --> 00:14:07.799 So they did the right thing, but it cost them. 00:14:08.340 --> 00:14:10.440 While they were waiting, competitors were flying 00:14:10.440 --> 00:14:13.580 747s and DC -10s and capturing the market. Exactly. 00:14:13.620 --> 00:14:17.049 So we see this pattern. Innovation, but also 00:14:17.049 --> 00:14:20.570 incredible risk. And that brings us to the next 00:14:20.570 --> 00:14:23.470 big shift, the Borman era. We go from a World 00:14:23.470 --> 00:14:26.669 War I ace to a space age hero. Colonel Frank 00:14:26.669 --> 00:14:28.649 Borman, this guy wasn't just the CEO. He was 00:14:28.649 --> 00:14:31.909 American royalty, West Point Air Force, NASA 00:14:31.909 --> 00:14:35.009 astronaut. He commanded Apollo 8. The first mission 00:14:35.009 --> 00:14:37.850 to orbit the moon. The man who read from the 00:14:37.850 --> 00:14:40.490 book of Genesis as the Earth rose over the lunar 00:14:40.490 --> 00:14:42.889 surface on Christmas Eve. That's the one. He 00:14:42.889 --> 00:14:46.039 takes over Eastern in 1975. And he brings that 00:14:46.039 --> 00:14:48.700 astronaut intensity with him. He moves the headquarters 00:14:48.700 --> 00:14:50.700 from Rockefeller Center down to Miami -Dade. 00:14:50.779 --> 00:14:53.019 And he changes the slogan to, we have to earn 00:14:53.019 --> 00:14:54.940 our wings every day. Which feels a little more 00:14:54.940 --> 00:14:56.659 greedy, a little less grand than the wings of 00:14:56.659 --> 00:14:59.600 man. It reflected the reality of late 70s. The 00:14:59.600 --> 00:15:01.899 economy was shaky. And the biggest threat of 00:15:01.899 --> 00:15:04.639 all was on the horizon. Deregulation. We hear 00:15:04.639 --> 00:15:06.940 that word a lot. Deregulation. Yeah. But what 00:15:06.940 --> 00:15:09.639 did it actually mean for airlines? Before 1978, 00:15:09.980 --> 00:15:12.039 the government basically treated airlines like 00:15:12.039 --> 00:15:14.960 public utilities. An agency set the routes and 00:15:14.960 --> 00:15:16.860 the prices. You couldn't really compete on price. 00:15:16.860 --> 00:15:19.440 You competed on steak dinners and leg room. It 00:15:19.440 --> 00:15:22.240 was stable, but expensive for the consumer. Right. 00:15:22.460 --> 00:15:24.460 Deregulation just took the referee off the field. 00:15:24.860 --> 00:15:27.840 Suddenly, any airline could fly anywhere and 00:15:27.840 --> 00:15:30.080 charge anything they wanted. It was a free -for 00:15:30.080 --> 00:15:32.779 -all. Total chaos. Low -cost carriers started 00:15:32.779 --> 00:15:36.259 popping up. But Borman had a plan. And this plan 00:15:36.259 --> 00:15:38.460 is fascinating because it was logical, it was 00:15:38.460 --> 00:15:41.080 smart, and it was completely disastrous. This 00:15:41.080 --> 00:15:44.620 is the oil bet. Exactly. In the late 70s, oil 00:15:44.620 --> 00:15:47.379 prices were skyrocketing. Yeah. Everyone, and 00:15:47.379 --> 00:15:49.460 I mean everyone from Wall Street to the White 00:15:49.460 --> 00:15:51.700 House, thought fuel was just going to keep getting 00:15:51.700 --> 00:15:54.220 more and more expensive. So Borman goes on this 00:15:54.220 --> 00:15:57.600 huge shopping spree. He buys the Airbus A300s. 00:15:57.840 --> 00:15:59.860 He becomes the launch customer for the Boeing 00:15:59.860 --> 00:16:02.259 757, all because they were super fuel efficient. 00:16:02.440 --> 00:16:05.080 And he took on massive debt to do it. We're talking 00:16:05.080 --> 00:16:06.820 about a situation where Eastern was paying over 00:16:06.820 --> 00:16:10.940 $700 ,000 a day. $700 ,000 a day? In interest? 00:16:11.360 --> 00:16:14.580 Just in interest. Before selling a single ticket. 00:16:15.159 --> 00:16:18.659 But his logic was, my debt will be high, but 00:16:18.659 --> 00:16:21.899 my fuel bill will be low. My competitors will 00:16:21.899 --> 00:16:24.720 be flying old, thirsty jets, and they'll go broke 00:16:24.720 --> 00:16:27.159 buying gas. And then the exact opposite happened. 00:16:27.480 --> 00:16:29.820 The bottom fell out of the oil market, the 1980s 00:16:29.820 --> 00:16:32.720 oil glut. Prices didn't go up, they plummeted. 00:16:32.720 --> 00:16:35.610 Oh, the irony. It's brutal. So now Eastern is 00:16:35.610 --> 00:16:38.169 stuck with these massive debt payments for shiny 00:16:38.169 --> 00:16:40.929 new planes, while new competitors like People 00:16:40.929 --> 00:16:43.970 Express are buying old gas guzzlers for pennies 00:16:43.970 --> 00:16:46.230 on the dollar and running them profitably because 00:16:46.230 --> 00:16:48.629 fuel is cheap. It's a total disaster. He built 00:16:48.629 --> 00:16:51.230 an airline for a high cost oil world and ended 00:16:51.230 --> 00:16:53.990 up living in a low cost oil world. And he's fighting 00:16:53.990 --> 00:16:56.309 a war on two fronts. He's got the low cost carriers 00:16:56.309 --> 00:16:58.850 and he's got Delta. The Battle of Atlanta. Both 00:16:58.850 --> 00:17:01.870 Eastern and Delta had huge hubs in Atlanta. They 00:17:01.870 --> 00:17:04.269 were fighting for the same passengers. But Delta 00:17:04.269 --> 00:17:06.690 had a better balance sheet and, crucially, a 00:17:06.690 --> 00:17:08.450 much better relationship with its employees. 00:17:09.170 --> 00:17:11.890 Eastern's workforce was heavily unionized and 00:17:11.890 --> 00:17:14.509 very militant. And this financial pressure led 00:17:14.509 --> 00:17:17.170 to some really weird experiments. We have to 00:17:17.170 --> 00:17:19.259 talk about the Moonlight Specials. Laughing. 00:17:19.380 --> 00:17:23.819 The Moonlight Specials. This was 1985. Eastern 00:17:23.819 --> 00:17:26.200 was desperate for any revenue they could find. 00:17:26.339 --> 00:17:29.259 They looked at their big A300 jets sitting on 00:17:29.259 --> 00:17:31.240 the ground between midnight and 6 a .m. and said, 00:17:31.339 --> 00:17:34.359 how can we make money with these? So they became 00:17:34.359 --> 00:17:38.119 a cargo airline at night. Primarily cargo. Mail, 00:17:38.119 --> 00:17:40.420 machine parts, textiles. But then they thought, 00:17:40.440 --> 00:17:42.180 well, the plane's flying anyway. Why not put 00:17:42.180 --> 00:17:44.380 people in the seats? So they created the Moonlight 00:17:44.380 --> 00:17:47.119 Special, flights leaving around 1 in the morning. 00:17:47.279 --> 00:17:51.240 And the passenger experience was... To say the 00:17:51.240 --> 00:17:54.140 least. Because the cargo hold was full of, you 00:17:54.140 --> 00:17:56.460 know, actual cargo, passengers were only allowed 00:17:56.460 --> 00:17:58.880 two carry -on bags. If you wanted to check a 00:17:58.880 --> 00:18:01.480 bag, it cost $10 and it flew standby. Your bag 00:18:01.480 --> 00:18:03.000 might get there with you. It might get there 00:18:03.000 --> 00:18:05.160 the next night. It was cargo first service. And 00:18:05.160 --> 00:18:07.980 on board, they sold snacks for $0 .50. It was 00:18:07.980 --> 00:18:11.400 gritty. And the demographics. We have this quote 00:18:11.400 --> 00:18:13.839 here from a flight attendant. in the New York 00:18:13.839 --> 00:18:16.039 Times. It's incredible. She described the passengers 00:18:16.039 --> 00:18:18.900 as a cross -section of families, college kids, 00:18:19.240 --> 00:18:22.579 illegal aliens, and weirdos from L .A. Weirdos 00:18:22.579 --> 00:18:25.500 from L .A.? That just paints such a vivid picture. 00:18:25.680 --> 00:18:28.619 It sounds like a Greyhound bus at 30 ,000 feet. 00:18:28.759 --> 00:18:30.819 Pretty much. I mean, it generated some cash, 00:18:30.900 --> 00:18:33.160 but it totally cheapened the brand. You go from 00:18:33.160 --> 00:18:35.839 the Wings of Man to the Weirdos special in just 00:18:35.839 --> 00:18:37.480 a few years, it just showed how desperate they 00:18:37.480 --> 00:18:39.779 were. And alongside all this financial trouble, 00:18:39.920 --> 00:18:43.039 there was the safety record. Eastern. had some 00:18:43.039 --> 00:18:45.559 very high -profile incidents that really hurt 00:18:45.559 --> 00:18:47.319 their reputation. They did, and unfortunately, 00:18:47.539 --> 00:18:49.900 they're famous for one of the most studied crashes 00:18:49.900 --> 00:18:54.700 in aviation history, Flight 401 in 1972. This 00:18:54.700 --> 00:18:57.960 was the L -1011, the Whisperliner crash in the 00:18:57.960 --> 00:19:01.200 Everglades. A brand -new, wide -bodied jet. They 00:19:01.200 --> 00:19:03.880 were on approach to Miami. They lowered the landing 00:19:03.880 --> 00:19:06.079 gear, but the little green light that confirms 00:19:06.079 --> 00:19:09.059 the nose gear is down and locked. It didn't come 00:19:09.059 --> 00:19:11.460 on. Just a burnt out light bulb. Most likely. 00:19:11.559 --> 00:19:15.200 Just a $12 bulb. But the entire crew, the captain, 00:19:15.319 --> 00:19:17.160 the first officer, the flight engineer, they 00:19:17.160 --> 00:19:19.519 all got fixated on this one light. The captain 00:19:19.519 --> 00:19:21.480 sent the engineer down into the avionics bay 00:19:21.480 --> 00:19:23.640 under the cockpit to physically check if the 00:19:23.640 --> 00:19:25.779 gear was down. And while this is all happening, 00:19:25.920 --> 00:19:27.990 no one is flying the plane. They thought the 00:19:27.990 --> 00:19:30.269 autopilot was. They'd set it to hold at 2 ,000 00:19:30.269 --> 00:19:32.710 feet. But the captain, while turning to talk 00:19:32.710 --> 00:19:34.849 to the engineer, probably bumped the control 00:19:34.849 --> 00:19:38.430 yoke. And on the L -1011, that disengaged the 00:19:38.430 --> 00:19:41.089 altitude hold. So the plane just started a slow, 00:19:41.289 --> 00:19:44.650 gradual descent. Exactly. And because it was 00:19:44.650 --> 00:19:47.549 a pitch black night over the Everglades, no lights 00:19:47.549 --> 00:19:50.609 on the ground, no horizon, they never felt it. 00:19:50.890 --> 00:19:53.769 They flew a perfectly functioning aircraft right 00:19:53.769 --> 00:19:56.789 into the swamp. 101 people died. It was a horri 00:19:56.789 --> 00:19:59.960 - Horrific, preventable tragedy. But it changed 00:19:59.960 --> 00:20:03.099 aviation forever. It basically birthed the concept 00:20:03.099 --> 00:20:06.660 of crew resource management, CRM. The idea that 00:20:06.660 --> 00:20:08.720 crews need to communicate, that someone always 00:20:08.720 --> 00:20:10.680 needs to be flying the plane. It's going. And 00:20:10.680 --> 00:20:12.519 then you have the freak accidents, like Flight 00:20:12.519 --> 00:20:16.059 611 in 1948. That one is terrifying. It was a 00:20:16.059 --> 00:20:18.460 constellation flying over the ocean, and the 00:20:18.460 --> 00:20:20.900 number three propeller just failed. A blade snapped 00:20:20.900 --> 00:20:23.380 right off. And it didn't just fall away. No. 00:20:23.440 --> 00:20:26.000 It flew back and sliced through the fuselage. 00:20:26.059 --> 00:20:28.279 like a giant spinning knife. It cut the control 00:20:28.279 --> 00:20:30.480 cables, cut the engine controls, and actually 00:20:30.480 --> 00:20:32.700 killed a crew member instantly. Then the whole 00:20:32.700 --> 00:20:34.319 engine fell off the wing. That plane should have 00:20:34.319 --> 00:20:36.900 crashed. It absolutely should have. But the pilots 00:20:36.900 --> 00:20:39.640 somehow managed to regain control and land it 00:20:39.640 --> 00:20:42.240 safely. It just speaks to the incredible skill 00:20:42.240 --> 00:20:44.599 of the pilots back then. And we can't ignore 00:20:44.599 --> 00:20:47.940 the hijackings. The late 60s were the golden 00:20:47.940 --> 00:20:50.700 age of hijackings to Cuba. It felt like it was 00:20:50.700 --> 00:20:53.410 happening every week. Take me to Havana was a 00:20:53.410 --> 00:20:56.369 catchphrase, but Eastern had one in 1969. That 00:20:56.369 --> 00:20:59.529 was, well, it was bizarre. The prank hijacking. 00:20:59.630 --> 00:21:02.769 A man stands up with what looks like a gun and 00:21:02.769 --> 00:21:05.750 demands to go to Cuba, but sitting in the cabin 00:21:05.750 --> 00:21:08.509 is Alan Funt. The host of Candid Camera. The 00:21:08.509 --> 00:21:11.269 one and only. So the passengers, they see the 00:21:11.269 --> 00:21:13.529 hijacker, then they look over and see Alan Funt 00:21:13.529 --> 00:21:15.680 and they do the math. They start laughing. They 00:21:15.680 --> 00:21:17.519 thought it was a TV sketch. They were convinced 00:21:17.519 --> 00:21:19.339 it was a prank. They're looking around for the 00:21:19.339 --> 00:21:22.220 hidden cameras. Funtz said it was the most terrifying 00:21:22.220 --> 00:21:24.339 moment of his life because no one was taking 00:21:24.339 --> 00:21:27.059 the danger seriously. It wasn't until they landed 00:21:27.059 --> 00:21:29.599 in Havana and Cuban soldiers surrounded the plane 00:21:29.599 --> 00:21:33.180 that everyone realized, oh, this is real. That 00:21:33.180 --> 00:21:37.099 is just surreal. So you have this company that's 00:21:37.099 --> 00:21:39.000 struggling with debt, fighting price wars, dealing 00:21:39.000 --> 00:21:42.359 with these dramatic incidents. But the real death 00:21:42.359 --> 00:21:45.369 knell that comes in the mid 80s. the sale to 00:21:45.369 --> 00:21:47.910 Texas Air. This is where the story really turns 00:21:47.910 --> 00:21:50.990 dark. Frank Borman, he can't fix the debt, he 00:21:50.990 --> 00:21:53.349 can't fix the labor issues, and he agrees to 00:21:53.349 --> 00:21:57.279 sell the airline in 1986. And the buyer is Texas 00:21:57.279 --> 00:21:59.960 Air Corporation, led by Frank Lorenzo. Frank 00:21:59.960 --> 00:22:02.140 Lorenzo. In the world of airline labor unions, 00:22:02.400 --> 00:22:05.099 that name is basically a curse word. He was a 00:22:05.099 --> 00:22:06.880 corporate raider. He'd already bought Continental 00:22:06.880 --> 00:22:08.859 Airlines and taken it into bankruptcy specifically 00:22:08.859 --> 00:22:11.220 to break the union contracts and slash wages. 00:22:11.720 --> 00:22:14.259 When Eastern employees heard Lorenzo was the 00:22:14.259 --> 00:22:17.420 buyer, many of them literally wept. They knew 00:22:17.420 --> 00:22:19.900 exactly what was coming. The sources talk about 00:22:19.900 --> 00:22:22.099 asset stripping. What did Lorenzo actually do? 00:22:22.299 --> 00:22:24.079 One of the first and most controversial things 00:22:24.079 --> 00:22:26.869 was a system called... System 1. This was Eastern's 00:22:26.869 --> 00:22:29.230 computer reservation system. Before the internet, 00:22:29.349 --> 00:22:31.289 these systems were gold mines. Right. Travel 00:22:31.289 --> 00:22:33.650 agents paid fees to use them. They were high 00:22:33.650 --> 00:22:35.930 management software businesses buried inside 00:22:35.930 --> 00:22:39.309 low margin airlines. Lorenzo saw that value. 00:22:39.569 --> 00:22:42.710 He transferred ownership of System 1 from Eastern 00:22:42.710 --> 00:22:45.789 to his holding company, Texas Air, for about 00:22:45.789 --> 00:22:49.200 $100 million. Is that a fair price? Not even 00:22:49.200 --> 00:22:52.339 close. Most experts valued it at 200, maybe even 00:22:52.339 --> 00:22:56.539 400 million. So he basically took the most valuable 00:22:56.539 --> 00:22:59.460 asset out of Eastern, moved it to his own pocket, 00:22:59.599 --> 00:23:02.720 and then forced Eastern to pay him monthly fees 00:23:02.720 --> 00:23:06.140 to use the system it used to own. Wow. He was 00:23:06.140 --> 00:23:08.160 hollowing it out from the inside. He was selling 00:23:08.160 --> 00:23:10.700 the furniture to pay the rent. He sold the shuttle 00:23:10.700 --> 00:23:12.680 to Donald Trump. It became the Trump shuttle. 00:23:12.839 --> 00:23:14.440 He sold the Latin American routes, which were 00:23:14.440 --> 00:23:16.740 the only profitable part of the network. Sold 00:23:16.740 --> 00:23:19.180 them to American Airlines. These were Eastern's 00:23:19.180 --> 00:23:21.940 crown jewels. And the employees, they weren't 00:23:21.940 --> 00:23:23.819 going to just take it. The relationship with 00:23:23.819 --> 00:23:26.279 the unions, especially the machinists, was just 00:23:26.279 --> 00:23:29.420 toxic. Totally toxic. Lorenzo demanded massive 00:23:29.420 --> 00:23:32.319 pay cuts. The machinists, the IAM, they said 00:23:32.319 --> 00:23:35.480 no. And that leads to the strike of 1989. March 00:23:35.480 --> 00:23:40.339 4th, 1989. Lorenzo locks out the mechanics. He 00:23:40.339 --> 00:23:42.640 expected to break them. He thought the pilots 00:23:42.640 --> 00:23:44.660 would cross the picket line. But... Something 00:23:44.660 --> 00:23:47.099 unprecedented happened. The hatred for Lorenzo 00:23:47.099 --> 00:23:49.579 was so strong, it unified everyone. The pilots 00:23:49.579 --> 00:23:51.599 union and the flight attendants union joined 00:23:51.599 --> 00:23:54.339 the strike in sympathy. They refused to cross 00:23:54.339 --> 00:23:56.500 the picket line. And that just grounded the airline 00:23:56.500 --> 00:23:59.500 overnight. 90 % of flights canceled. It was a 00:23:59.500 --> 00:24:02.680 war of attrition. The unions wanted to force 00:24:02.680 --> 00:24:05.059 Lorenzo out, even if it meant killing the airline. 00:24:05.299 --> 00:24:07.680 And Lorenzo wanted to break the unions, even 00:24:07.680 --> 00:24:09.680 if it meant killing the airline. Mutually assured 00:24:09.680 --> 00:24:12.769 destruction. Precisely. The airline filed for 00:24:12.769 --> 00:24:15.589 Chapter 11 bankruptcy just five days later. They 00:24:15.589 --> 00:24:17.509 tried to keep flying with replacement workers, 00:24:17.690 --> 00:24:19.930 but the damage was done. And eventually the court 00:24:19.930 --> 00:24:22.609 had to step in. Yes. In 1990, the bankruptcy 00:24:22.609 --> 00:24:24.890 judge actually removed Lorenzo from control, 00:24:24.970 --> 00:24:27.849 which is extremely rare. They brought in a trustee, 00:24:27.869 --> 00:24:30.230 Martin Shugrue, to try and save it. And Shugrue 00:24:30.230 --> 00:24:32.950 tried. They won her day's campaign. It was a 00:24:32.950 --> 00:24:36.049 total Hail Mary. Shugru himself appeared in TV 00:24:36.049 --> 00:24:38.670 ads. He admitted the airline had problems, but 00:24:38.670 --> 00:24:40.789 he promised that Eastern would get a little bit 00:24:40.789 --> 00:24:43.269 better every day. Did it work at all? Shockingly, 00:24:43.269 --> 00:24:46.029 yes, for a bit. Bookings went up. The public 00:24:46.029 --> 00:24:49.109 loves an underdog story. But the financial hole 00:24:49.109 --> 00:24:52.569 was just too deep. And then history intervened 00:24:52.569 --> 00:24:56.329 one last time. The first Gulf War. Saddam Hussein 00:24:56.329 --> 00:25:00.309 invaded Kuwait. Oil prices spiked again. A recession 00:25:00.309 --> 00:25:02.809 hit. People stopped flying because they were 00:25:02.809 --> 00:25:06.109 afraid of terrorism. Eastern had absolutely no 00:25:06.109 --> 00:25:09.269 cash cushion left. And that was it. January 1991. 00:25:09.789 --> 00:25:12.329 It was sudden. Midnight on a Saturday, January 00:25:12.329 --> 00:25:15.410 19th. Management realized they couldn't make 00:25:15.410 --> 00:25:17.509 payroll. They couldn't even pay for fuel for 00:25:17.509 --> 00:25:19.609 the next day's flights. And the decision was 00:25:19.609 --> 00:25:21.329 made to shut it all down. And the most tragic 00:25:21.329 --> 00:25:23.430 detail is that the reservation agents were still 00:25:23.430 --> 00:25:25.529 taking bookings that night. They had no idea. 00:25:25.549 --> 00:25:27.289 They were selling tickets for flights the next 00:25:27.289 --> 00:25:29.289 week, completely unaware that the airline would 00:25:29.289 --> 00:25:31.930 cease to exist in a few hours. So employees just 00:25:31.930 --> 00:25:34.240 showed up for work on Sunday morning. and found 00:25:34.240 --> 00:25:37.460 chains on the doors at Miami, at LaGuardia, security 00:25:37.460 --> 00:25:40.220 guards turning them away. 18 ,000 people were 00:25:40.220 --> 00:25:42.640 out of a job instantly. Gone. The Great Silver 00:25:42.640 --> 00:25:44.960 Fleet was grounded for good. Yeah. The planes 00:25:44.960 --> 00:25:47.259 were flown to the desert. Delta bought the L 00:25:47.259 --> 00:25:51.059 -1011s. U .S. Air bought the 757s. The carcass 00:25:51.059 --> 00:25:54.319 was just picked clean. It's just staggering to 00:25:54.319 --> 00:25:56.640 think an organization that large, that was such 00:25:56.640 --> 00:25:59.079 a part of the country's infrastructure, could 00:25:59.079 --> 00:26:01.619 just dissolve. It really shows you the fragility 00:26:01.619 --> 00:26:03.759 of legacy. Eastern had everything, the routes, 00:26:03.960 --> 00:26:07.740 the planes, the brand. But a combination of bad 00:26:07.740 --> 00:26:11.420 strategic bets, toxic labor relations, and just 00:26:11.420 --> 00:26:13.740 an inability to adapt to the new world destroyed 00:26:13.740 --> 00:26:16.880 it. But the name didn't fully die, did it? It's 00:26:16.880 --> 00:26:19.140 kind of a zombie brand. It is. Airline names 00:26:19.140 --> 00:26:22.299 have value. In 2015, a new group launched an 00:26:22.299 --> 00:26:25.160 Eastern Airlines as a charter service. They even 00:26:25.160 --> 00:26:26.980 painted the planes with the old hockey stick 00:26:26.980 --> 00:26:28.759 livery. It must have been pretty nostalgic to 00:26:28.759 --> 00:26:30.740 see that at an airport. It was, but that venture 00:26:30.740 --> 00:26:33.539 folded. Then in 2020, another Eastern Airlines 00:26:33.539 --> 00:26:35.799 launched. It's not the giant that Rickenbacker 00:26:35.799 --> 00:26:38.359 built. It's just the name. So as we wrap this 00:26:38.359 --> 00:26:41.420 up, what's the big takeaway? Why does the story 00:26:41.420 --> 00:26:43.859 of Eastern still matter today? I think it's a 00:26:43.859 --> 00:26:46.779 warning about complacency. Eastern assumed its 00:26:46.779 --> 00:26:48.839 position was secure because it was one of the 00:26:48.839 --> 00:26:51.940 big four. They bet wrong on jets. They bet wrong 00:26:51.940 --> 00:26:54.839 on oil. And they treated their employees as the 00:26:54.839 --> 00:26:57.059 enemy. It really does prove that no company is 00:26:57.059 --> 00:26:59.579 too big to fail. Exactly. We look at the big 00:26:59.579 --> 00:27:01.920 airlines today and think they're permanent. But 00:27:01.920 --> 00:27:05.339 Pan Am is gone. TWA is gone. Eastern is gone. 00:27:05.799 --> 00:27:08.519 The industry is just incredibly volatile. So 00:27:08.519 --> 00:27:10.619 here's a provocative question for you to think 00:27:10.619 --> 00:27:14.059 about as we finish. In our era of... Constant 00:27:14.059 --> 00:27:16.779 airline mergers and consolidations. Could we 00:27:16.779 --> 00:27:18.779 see another one of these giants disappear overnight? 00:27:19.000 --> 00:27:21.119 Could we wake up one Saturday and find that a 00:27:21.119 --> 00:27:23.799 major carrier has just stopped flying? It's not 00:27:23.799 --> 00:27:26.819 impossible. High debt, external shocks like pandemics 00:27:26.819 --> 00:27:29.779 or wars. It's always a possibility. A sobering 00:27:29.779 --> 00:27:32.319 thought. But let's end on a lighter note. If 00:27:32.319 --> 00:27:34.119 you have a minute today, go online and just look 00:27:34.119 --> 00:27:36.680 up a picture of the Lockheed L -1011 Whisper 00:27:36.680 --> 00:27:39.480 Liner in that polished silver hockey stick livery. 00:27:39.619 --> 00:27:41.599 It really was a beautiful piece of machinery. 00:27:41.819 --> 00:27:44.180 It really was. The chrome of the skies. That's 00:27:44.180 --> 00:27:46.099 it for this deep dive. Thanks for listening, 00:27:46.200 --> 00:27:48.559 and we'll catch you on the next one. Safe travels.