Ludington Airline

History

Charles Townsend Ludington and his brother were wealthy socialites in the 1920s. In 1929 they were contacted by two former executives of Transcontinental Air Transport with an idea to start a short distance airline service and wished the Ludingtons to finance it. In 1930 the four of them started the New York-Philadelphia-Washington Airways company. Its home base was Philadelphia. It became known as Ludington Airlines, under Ludington Lines Incorporated in 1933, mainly because it did not directly touch New York City, Philadelphia, or Washington D.C. When the company was originally formed in 1930, Amelia Earhart was one of its vice presidents, in charge of traffic management and public relations.

Ludington Lines was the first airline that had flights every hour on the hour, a completely new idea for the aviation industry. Their brochures advertised "Plane Service, like Train Service" as their mode of operation. The theory was that the people they catered to, business people that traveled the busiest transportation corridor in the United States of New York–Philadelphia–Washington, that were used to railroad time schedules, would then take a plane instead. Ludington Airline was the nearest thing to railroad timetables there was in the way of air passenger service. They sometimes sold their $23 round-trip airline tickets through railway depot terminals (e.g. Pennsylvania Railroad at Manhattan). This overall business plan concept proved to be a correct philosophy, as it was the first airline in the history of aviation that succeeded with this timetable schedule idea.

Ludington Airlines was of interest and watched by the airline industry from its beginnings, as no airline attempted running its business without the revenue earned from air mail. It used seven Stinson tri-motor 6000 model aircraft in its fleet, each carrying up to ten passengers. Its modus operandi consisted of six parts: 1) cheap equipment, 2) timely schedule, 3) short trips, 4) a good general economy, 5) reasonable fares, and 6) aircraft filled on average to at least 60% capacity. In addition the planes flew with only one pilot, cruised using cheaper automobile gas, and taxied using only one engine instead of all three. The airline in its first year of operation of only passenger service made a profit of over $8,000 without any government revenue subsidies.

Ludington Airline in its first year made 8,300 trips and carried 66,000 passengers with an overall average load filled to 66% capacity. In two years time it flew over 3.4 million miles and carried 133,000 passengers. This was a record for any airline at the time. The airline expanded and had subsidiary companies. It provided service between Washington, D.C. and New York City with stops in Philadelphia, Norfolk, Virginia, Nashville and Knoxville, Tennessee. There was a 1931 study done of Ludington Airline's operation by the director of Germany's Luft Hansa and based on that an hourly airline service was put into place between Cologne and Frankfurt, Germany.

Demise

Ludington and his brother invested over $1,000,000 into the company. They never sold any stock to the public and thought they could sustain losses for five years. In 1933 Ludington Lines went bankrupt, partly because they failed to secure a Post Office air mail contract that they bid on for 25 cents per mile. Ludington Lines executive vice president claimed that had they obtained this contract, that their profits would have been triple what they were in their first year of operation.

The Post Office air mail contract, controlled by Postmaster General Walter Folger Brown, went to their rival company Eastern Air Transport (EAT) for 89 cents a mile – over three times what Ludington bid. Ludington Airline was sold for a quarter of the Ludington's investment to EAT under questionable terms that was influenced by Brown. This inflated air mail contract and takeover of Ludington Airline by EAT started an investigation that became known as the Air Mail scandal.