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by The United Federation of Etheinia. . 50 reads.

Consolidated Eastern Airlines(CEA)

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Consolidated Eastern Airlines--------




IATA: CE
ICAO: CEA
Callsign: CONEAST


Type
Publicly Traded Corporation

Industry
Commercial Airline

Founded
1973

Headquarters

Area Served
Global

Number of Employees
42,000

Fleet Size
336 aircraft

History
Beginnings
Consolidated Eastern Airlines was formed in 1973 following the leveraged buyout and subsequent merger of Etheinia's two biggest airlines, Etheinian Eastern Airlines and SudanAir. This was the largest LBO in Etheinian history at the time. Despite some hostility between the employees of the two airlines and the private equity group which now managed them, the merger was mostly considered a success. After a brief delay, during which the fleet was painted with a new livery, CEA began domestic operations on September 17th, 1973. Short-range international flights began in October, offering routes to Cairo, Tripoli, Kinshasa, and Baghdad. Longer flights, to London, Paris, Moscow, Prague, and Warsaw, started at the beginning of 1974.

At the time of the merger, Consolidated Eastern Airlines fleet consisted mostly of Soviet jet airliners, along with turboprop aircraft, some DC-8s & 707s, and a limited number of 737-200s

Initial difficulties
Though the initial merger was considered to be highly promising, reality began to set in as 1974 rolled in. A serious lack of demand became apparent, as airfare was simply not affordable to the majority of Etheinians. This had been anticipated, but the high costs of managing a large airline had not, and costs quickly exceeded revenue. Attempts to expand availability were also met with high spending overruns.

CEA's reputation was also marred by two accidents, occurring within short succession of each other. On January 28th 1974, CEA Flight 22, a Tupolev Tu-124 experienced an uncontained engine failure minutes after takeoff and crashed, killing 34. The crash led to all CEA Tu-124s being grounded. On March 11th, CEA Flight 57, an Ilyushin Il-18, crashed on approach and killed 51. Soon Etheinia's high-class clientele began looking elsewhere for travel. CEA's numbers continued to slump through 1974.

In an attempt to recoup its losses, CEA management embarked on a new advertising campaign in 1975, and purchased new DC-9s and additional 737-200s. In July they purchased their first lot of 5 DC-10 aircraft. Revenue improved somewhat, but CEA remained unprofitable throughout 1975 and 1976.

NF Okorie and CEA's "golden age"
Ngozi Fumnanya Okorie, a successful Nigerian businessman, immigrated to Etheinian in 1976 on an investor visa. In 1977, he began looking at purchasing CEA, and secured an international loan to pay for the airline. On May 2nd, 1977, the airline was sold to him, and he immediately began making major changes.

NF Okorie's main strategy for CEA was to slash ticket prices, cut costs, and aggressively pursue expansion. At the time, Etheinia was rapidly urbanizing, but air travel still remained out of reach for most citizens. In July, a new ad campaign promoted that prices had been reduced significantly, making flying suddenly affordable for much of the growing middle class. Okorie also influenced the government to reduce passport requirements, and funded the construction of new airports. All this had the desired effect: the number of passengers carried skyrocketed. The end of 1977 was CEA's first reported profitable quarter. To support the increased passenger numbers, CEA purchased additional DC-9s and DC-10s in 1978. It also considered purchasing additional 737-200s, but opted instead for the MD-80. In order to reduce airfares, the airline began making seats much smaller and squeezed them closer together. It also began charging passengers for checked baggage, becoming one of the first airlines to do so.

CEA continued to experience increased growth and profit into the 1980s. In 1982 the first 747s were purchased, resulting in the retirement of older Soviet aircraft. 1983 saw CEA launch a successful ad campaign, called "Hold the World", which promoted low-cost international travel to Etheinians. The fleet was also given a new livery and the distinctive CEA logo, which is still in use today. In 1984, the luxury FirstAire line began flying, using Dassault Falcon 50s to transport high-paying passengers in comfort. The fleet continued to expand, with 737-300s first being purchased in 1986 along with more 747s, DC-10s, and MD-80s.

Though he was applauded for turning around the airline and was considered one of Etheinia's most successful businessmen, there was some criticism of NF Okorie's actions. In particular, his penny-pinching measures led to accusations of reducing safety standards for profit, and some said that these cuts directly led the Flight 86, Flight 245, and Flight 131 accidents(though there is no concrete evidence of this). He also cut benefits for employees and aggressively fought unionization, making him unpopular among his own workforce. Nevertheless, this did not stop the airline from growing; by the end of the 80’s, the fleet had expanded to 250 aircraft(including the 757, 737-400, Tu-204, and Fokker 50) and was carrying between 20-30 million passengers per year.

Struggles, Strikes, and Bankruptcy
In November 1990, CEA went public with an IPO of $8 a share. Shortly after, NF Okorie finally left the company in early 1991 to pursue oil drilling opportunities, after managing the company for 14 years. He called CEA “one of the proudest accomplishments in my lifetime”.

The success was not to continue for long, however. Though 1991 and 1992 saw profits remaining steady, they also saw increased competition from newer low-cost airlines. In addition, the Etheinian government began placing heavier scrutiny on commercial airliners following a string of deadly accidents in the 80’s and early 90’s. In April 1993, CEA was slapped with a $6 million fine for safety violations and was grounded for 8 weeks until its fleet could be brought up to standards. Declining profits led to 1,000 employees being laid off in September, followed by 1,000 more in January 1994.

A string of new CEOs were brought in to try and remedy the situation, with varying levels of success. 1994 saw some improvement in profits and investor confidence recovered, but the worst was yet to come. In November 1994, CEA Flight 322, a 747 flying to Algiers, broke up in mid-air and killed all 443 people on board. The airline was hit with a $10 million fine, was forced to pay a $25 million class-action settlement, and had to ground all of its 747s pending inspections. By 1995, things were looking grim for the company. Facing shareholder pressure, CEA management laid off an additional 4,000 employees and informed the rest that there would be significant cuts to salaries and benefits.

CEA’s own employees, however, were not taking it. On March 5th, 1995, over 20,000 CEA workers went on strike, demanding increased pay, better working conditions, and an end to the layoffs. The company’s headquarters were picketed, and on several occasions they attempted to blockade terminals at Bole International Airport to prevent substitute workers from getting in. On March 14th, several disgruntled employees jumped the airport perimeter fence and unsuccessfully tried to set fire to a CEA Fokker 50 on the ground using a can of petrol. Finally, after three weeks of protests, government strikebreakers dispersed employees and negotiated an agreement between them and the company. Flights began again in April, but the company had been thoroughly shaken by the strike and was continuing to operate at a loss.

CEA continued to struggle financially over the next three years. Finally, after the shocks of the 1997 Asian financial crisis and the 1998 Russian financial crisis, CEA filed for bankruptcy on September 18th, 1998. The airline was liquidated with most of the fleet being mothballed and workers being laid off. CEA was acquired by KaderSamara and continued to offer limited service, but it was mostly dormant for the next six years.

Resurgence
In 2004, KaderSamara sold off CEA to a private equity firm, which began planning a comeback for the company. Despite some skepticism, several large loans were secured and the fleet was brought back into service. Regular operations began again on June 14th, 2004. CEA’s new management quickly expanded to new routes & bought new aircraft, and they drastically lowered prices in an effort to undercut competitors. In addition, they also capitalized off public dissatisfaction with other airlines at the time by emphasizing the trusted CEA name, portraying itself as a dependable stalwart for Etheinian travelers. Profits rebounded, and by 2006 CEA went public again and was relisted on the Etheinian stock exchange.

CEA has continued to grow after being refounded, regaining its position as Etheinia’s largest airline. In 2010, a frequent-flyer program was started, and in 2015 it reached a new record of 50 million passengers per year. It is part of the Top 50 publicly-traded companies in Etheinia. Expanded service to Japan and Korea began in 2022, resulting in an influx of businessmen & tourists to Etheinia.

Accidents & Incidents
Flight 22(Jan 28 1974): A Tu-124, traveling from Addis Ababa to Khartoum, experienced an uncontained engine failure shortly after takeoff. This caused severe damage to the left wing and a rapid depressurization of the cabin, resulting in the crew losing control and crashing. 34 people were killed. An investigation found that a fan disk had been damaged during maintenance and subsequently broke apart during flight, resulting in the engine failure.
Flight 57(Mar 11 1974): An Il-18 crashed on approach to Asosa Airport. All 51 aboard were killed. The crash was attributed to pilot error, as there was bad weather at the time of the crash and the pilot was not properly trained for working under IFR conditions.
Flight 31(Nov 23 1976): A Boeing 707 returning to Port Sudan from Saint Petersburg(then Leningrad) stalled after takeoff and crashed. 104 were killed. Icing on the wings was blamed for the stall.
Flight 74(Jul 2 1978): An Il-62 flying to Baghdad lost control and crashed into the Red Sea after the rudder jammed and the aircraft rolled too far left. 82 were killed. The reason for the jam was never found but is suspected to have been caused by rusting of the actuator mechanism.
Flight 106(Apr 10 1981): A 737-200 crashed during a go-around near Addis Ababa. 55 were killed. An investigation discovered that the thrust reversers had failed to retract after the go-around was initiated, causing the crash.
Flight 86(Sep 30 1981): A DC-9 flying from Khartoum to Mogadishu suffered explosive decompression after a blowout of one of the aft cabin doors and subsequent damage to the fuselage. Two people, a flight attendant and a passenger, were sucked out and killed. A third person died and 19 more were injured due to hypoxia. The pilots successfully diverted to El Obied. An investigation found that shoddy welding during a previous repair of the door caused it to fail during flight, and that passengers had not been properly instructed on how to put on their oxygen masks.
Flight 165(May 17 1982) An F-27 Friendship collided with mountains while flying over Ethiopia. 18 were killed. Controlled flight into terrain(CFIT) caused by pilot error was found to be the cause.
Flight 245(Dec 13 1983): A 737-200, flying from Port Sudan to Nairobi, suffered a cargo fire while flying over Kenya. The cockpit crew did not receive any fire warnings and was not aware of the emergency until a flight attendant alerted them to smoke in the cabin. A forced landing in a field was attempted, but during descent all hydraulic system pressure was lost and the flight controls failed, resulting in the crash. All 118 aboard were killed. An investigation determined that the fire was ignited by faulty wiring, and that the fire protection system for the cargo hold had never been operational.
Flight 207(Feb 2 1983): A DC-9 encountered severe windshear while approaching the runway at Addis Ababa. The pilots lost control and crashed, killing 68. Installation of a Low-Level Windshear Alert System (LLWAS) at all major Etheinian airports was made mandatory after this crash.
Flight 54(Apr 25 1984): A 737-200 was hijacked by three men wielding knives shortly after taking off from Asmara. The hijackers radioed ATC with a demand for $500,000 in cash. The 737 landed in Port Sudan, and after an 18-hour police standoff the three men surrendered without incident. There were no casualties.
Flight 131(Oct 12 1986): A DC-10 flying to Budapest suffered a hard landing after the nose gear collapsed upon hitting the runway. 145 passengers were injured and the aircraft suffered extensive damage and was written off. It was determined that extensive rusting of the nose gear caused the accident, which could have been prevented with proper maintenance.
Flight 315(Aug 6 1990 : An MD-80 collided with mountains while flying to Mogadishu. 87 were killed. The cause was determined to be CFIT caused by pilot error and miscommunications between the plane and ATC.
Flight 119(Nov 31 1992) : A 737-300 landing in Riyadh overshot the runway and hit a car on a road outside the airport before coming to rest. Both passengers of the car were killed and 22 people aboard the aircraft were injured. The cause was pilot error.
Flight 332(Nov 17 1994): A 747, flying from Port Sudan to Algiers, broke up in mid-air while flying over Algerian territory. All 443 people on board were killed; it remains the deadliest civil air accident in both CEA’s and Etheinia’s history, and the third-deadliest accident worldwide(behind the Tenerife Airport Disaster and Japan Airlines Flight 123). The exact cause of the breakup is not known, but investigators have blamed a combination of metal fatigue, undetected structural damage caused by a hard landing several years before, and sloppy repair work by CEA.
Flight 572(Sep 4 2006): A DC-9 overshot the runway after an aborted takeoff and crashed into a water tank, killing 10 and injuring 45. The cause was determined to be pilot error after an investigation revealed that the flight crew had received an engine fire warning shortly after V1 and had(against procedure) attempted to abort the takeoff rather than initiate a takeoff & go-around. The investigation also revealed that the fire warnings had most likely been caused by a leak in the bleed air system, not an actual engine fire. This accident prompted mandatory retraining of all Etheinian pilots.
Flight 167(May 8 2011): A man aboard a 757 flying to Istanbul suddenly became disruptive and violent, attempting to storm the cockpit and assault the flight crew. He was restrained by flight attendants and other passengers and was arrested on landing. One flight attendant sustained minor bruising during the incident. A police inquiry found that man was not shown to be connected to any terrorist groups and had no record of mental illness, but that he did have a blood-alcohol level of .11 at the time of arrest. Officials concluded it was air rage and the man was fined $10,000.
Flight 691(June 14 2015): A Strela-2 missile was fired at a 737-700 as it was taking off from Asmara International Airport. The missile failed to hit the plane and did not cause any damage; the flight crew landed without incident. A disposed Strela-2 launcher was found outside the airport, and part of the airport perimeter fence had been cut to allow access. National Security officials suspect Eritrean separatists as being responsible for the attack. Two suspects were arrested in relation to the incident, but they were later deemed not responsible and released. The case is still being investigated. Greater security around airports was established after this attack.
Flight 548(Sept 29 2022): A DC-10 collided with mountains outside Gwangju, Korea, 7 km from the airport. 304 were killed; this was CEA’s deadliest accident in over twenty years. Investigators determined the cause to be CFIT caused by a combination of pilot error, poor visibility, erroneous approach plate data, and a malfunctioning ILS transmitter at the airport.

Fleet composition
Current:
Boeing 737 Classic: 40
Boeing 737 NG: 30
Boeing 747: 15
Boeing 757: 40
McDonnell Douglas DC-10/MD-11: 25
McDonnell Douglas DC-9: 60
McDonnell Douglas MD-80: 40
Tupolev Tu-204: 11
Fokker 50: 40
Dassault Falcon 50: 20
Dassault Falcon 900: 15

Retired:
Boeing 707
Boeing 737-200
McDonnell Douglas DC-8
Tupolev Tu-124
Tupolev Tu-134
Tupolev Tu-154
Ilyushin Il-62
Ilyushin Il-18
Fokker F-27 Friendship

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