History lessons: The perils of pioneering - Sir Freddie Laker

It sounds like a dot.com era battle: budget airlines undercutting flagship carriers by ditching frills such as meals and legroom.

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Last Updated: 31 Aug 2010

But Sir Freddie Laker began it all in 1977, when his Skytrain first crossed the Atlantic. He astutely judged that passengers would tolerate the odd inconvenience, like queuing for tickets if it meant being able to afford to travel. It worked: Skytrain's profits hit £1m in the first week, and by 1980 it was carrying one in seven of all transatlantic passengers. But he was soon brought down to earth. Two years later, his planes were turned round in mid-air as his firm went into receivership with debts of £264m. Laker's success had irked his rivals, who were said to have plotted his downfall. Skytrain's liquidators launched an anti-trust action, claiming $10bn from 10 airlines; the defendants settled out of court for £35m. Laker took £6m and retired to the Bahamas. Since, young pretenders like easyJet and Ryanair have taken off using the model he pioneered. Sometimes it's better to follow ...

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