What Happened To United’s ‘Ted’ Subsidiary?

Did you know that United Airlines once had a subsidiary with 56 Airbus A320s? Do you remember Ted? If you’d have blinked and you would have missed it. In operation for just five years, Ted was a United subsidiary that might have still been flying today if it wasn’t for a shifting financial market that rocked the aviation industry. Eleven years after it folded, we take a look back at what happened to United Airlines’ ‘Ted’.

Ted A320
What happened to United Airlines’ Ted? Photo: Getty Images

What was Ted?

In short, Ted was United Airlines’ attempt at taking on competition from airlines like Frontier and Southwest in the low-cost market.

Ted was a United Airlines’ subsidiary that got its name from the final stem of the word ‘United’. It was founded in November of 2003 and the airline took its first commercial flight on 12th February 2004 out of its base in Denver International Airport.

At the time, Denver International Airport was gaining in popularity. Southwest had just started its operations there and Frontier was already on the offensive to rival the competition. Ted became another airline competing in this fashionable market and it seemed to present a good opportunity.

It had a fleet of 56 Airbus A320-200 aircraft with 156 economy seats. With these aircraft, Ted became a low-cost leisure brand which took passengers to many regional destinations in the United States, Mexico, and some Caribbean Islands.

However, Ted was not to last long. In fact just five years after it started, the brand had folded whilst rivals Frontier and Southwest continued to prosper. What went wrong? On the face of it, a low-cost airline attached to a major airline looks like it might have been a good idea. Ted operated popular routes with a strong fleet, but that wasn’t enough.

Ted, A320
Ted succumbed to an unfavorable climate in the aviation industry. Photo: Getty Images

What happened to Ted?

At the time of Ted’s creation, the low-cost aviation market was picking up. There were many start-ups that boosted competition in the industry and prompted pre-existing airlines to venture into the low-cost market. They did so with subsidiaries. Was it the overpopulation that prompted many of those airlines, like Ted, to close? Not so.

In fact, the reason for Ted’s demise was nothing to do with the pressure from low-cost startups. Nor was it anything to do with the popularity of the airline. The issue was with the steep cost of jet fuel.

Ultimately, an increase in fuel prices at the time compromised the profitability of Ted and it was no longer viable for United to keep the low-cost subsidiary. Though United would not have known it, fuel prices would only continue increasing and making ends meet would have been even harder. Placed in a tough financial decision, United decided to fold the carrier and merge it into its existing airline instead.

A new future for Ted

Luckily for United, Ted had never been incorporated as a formal airline. Instead, it was more of a brand for United Airlines. As such, the transfer process was easy.

On 4th June 2008, Ted’s operations ceased and seven months later, Ted’s brand was absorbed by United Airlines. To make up for the removal of its Boeing 737 aircraft, United took on all 56 of the A320-200 and fitted them with first-class cabins.

Ted, A320 taxi
Ted’s aircraft went to United Airlines. Photo: Choster via Wikimedia Commons

According to Planespotters, all of Ted’s A320s still fly with United Airlines today. They make up a fleet of A320-200 that’s 99 strong and counting! This certainly shows that United took the right decision. Ted’s aircraft are much better off in the stable United fleet.

Were you lucky enough to fly with Ted? Tell us about your experience in the comments!