New Airline Offers $10 Tickets on All Flights

Skybus Airlines Inc., a new U.S. budget carrier, on Tuesday said it will start flying on May 22 with $10 one-way tickets available on all flights.

"Beginning today, passengers can buy airline tickets for less than the cost of a tank of gas," Skybus CEO Bill Diffenderffer said in a statement.

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The launch of the new low-cost carrier, which is based in Columbus, Ohio, could pressure established carriers like AMR Corp's (AMR) American Airlines and Delta Air Lines Inc..

Skybus, which plans to acquire more than 70 aircraft over the next five years, hopes to be able to undercut rivals by selling advertising space inside and outside its planes and charging for priority seating and checking bags.

It keeps costs down by only taking reservations over the Internet and not staffing a call center.

The start-up carrier, which has raised $160 million from investors, will have at least 10 seats available for $10 on its flights through December 15. The $10 tickets don't include taxes and fees.

Last-minute fares run as high as $330, spokesman Bob Tenenbaum said.

Skybus plans to fly initially from Columbus to Burbank, California; Portsmouth, New Hampshire; Richmond, Virginia; and Kansas City, Missouri.

On May 29, it plans to add service to Bellingham, Washington; Greensboro/Winston-Salem, North Carolina; and Fort Lauderdale.

In June, Skybus plans to begin flying to Oakland, California.

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