Trans International Airlines

Trans International Airlines (TIA), later Transamerica Airlines, was a United States airline. Regulated as a supplemental air carrier, it offered a hybrid of chartered and scheduled services. TIA was founded as Los Angeles Air Service (LAAS) in the 1940s and flew scheduled service to Hawaii as late as 1961.

Businessman Kirk Kerkorian owned the airline from 1948 to 1962 and again from 1964 to 1968, when he sold it to insurance company Transamerica Corporation. After buying Saturn Airways in 1976 TIA became the largest USA supplemental carrier. After the Airline Deregulation Act of 1979, the airline changed its name to Transamerica and added limited scheduled service. In 1986 Transamerica Corporation, reversing earlier diversification, tried to sell the airline, but liquidated it instead.

In 1984, while Transamerica Airlines was seeking wage cuts, Transamerica Corporation started a second Trans International Airlines, as a non-union subsidiary. Transamerica Corporation set a legal precedent for being allowed to own separate union and non-union airline subsidiaries.

History

Startup

Kirk Kerkorian was a pilot in World War II, engaged in pilot instruction and aircraft delivery across the Atlantic, including a record-setting nonstop flight of a deHavilland Mosquito from Canada to the UK.

In January 1946, Kerkorian and his sister formed a partnership to trade aircraft. This activity attracted significant attention when, in October 1946, while Kerkorian was flying a war-surplus Douglas DC-3 from Hawaii to the mainland, the ferry tank system malfunctioned and the engines quit. His crew issued a distress call before it was able to restore power, leading to news stories.L.A. Ex-Pilot Blame Tanks For 'Conk-Out' Los Angeles Evening Citizen News, 12 October 1946

Los Angeles Air Service (LAAS) was a separate nonscheduled airline, later known as an irregular air carrier or supplemental air carrier. LAAS was in operation with a C-47 as early as January 1946. In 1946, LAAS's presence was noted at LaGuardia in March, Chicago in April and LAAS advertised a charter flight to Alaska from Seattle in May.Los Angeles Air Service advertisement for chartered air service to Alaska, Seattle Star, 17 May 1946 In 1947, LAAS started a scheduled DC-3 service from Los Angeles Municipal Airport to Big Bear, at which time its owners/operators were James Porter and Lee Taylor.Airline Gives $3,000 To Aid Valley Publicity, Big Bear (CA) Grizzly, 7 November 1947

Kerkorian's partnership bought LAAS in June 1948, which on 13 August 1948 was issued a Letter of Registration by the CAB as an irregular air carrier (what the CAB then issued to such airlines in lieu of a certificate). Kerkorian incorporated Los Angeles Air Service, Inc., in California on 20 December 1948, a separate entity from the original LAAS. However, it was only on 5 April 1951 that the Letter of Registration was transferred from the LAAS partnership to the LAAS corporation, thereby making the corporate entity the airline.

Los Angeles Air Service Under Kerkorian, LAAS operated intermittently; it operated no flights at all from 3rd quarter of 1951 through 1st quarter of 1954, and had minimal operations in 1957 and 1958 (see Table 1). In September 1957, the CAB warned LAAS to operate within the next 30 days or lose operating authority, the airline having sold all its aircraft. Kerkorian's interests were as much in aircraft trading as airline operation: when Kerkorian took a stake in a Las Vegas casino in 1955, Variety Magazine referred to him not an airline operator but as an airplane dealer. Kerkorian made some famous deals through LAAS. For instance, in 1951, LAAS bought the wreckage of a British Overseas Airways Corporation (BOAC) Constellation in the UK from BOAC's insurers, shipped it to the US and had Lockheed rebuild it, leasing it to California Hawaiian Airlines, another irregular airline.Converted Connie To Link Hawaii With Coast Cities, Honolulu Star-Bulletin, 24 June 1952 All-told, the deal netted Kerkorian over a half-million dollars (over $5.5 million in 2025 dollars). See External links for photos of LAAS C-46 and DC-4 aircraft.

+ Table 1: Los Angeles Air Service financial results, 1952–1960 USD 000 1952(1)1953(1)1954195519561957195819591960Operating revenue: Military charter 624 1,032 1,950 21 31 1,315 1,652 Civilian charter 64 8 49 4 5 249 279 Scheduled 27 59 10 0 0 0 939 Other 0 1 0 313 184 78 0 Total0 0 715 1,100 2,009 338 220 1,642 2,870 Profit (loss) before taxes 0 1 34 3 (5) (169) (249) (69) 287 Operating revenue: % of industry(2)0.0 0.0 1.3 1.4 3.0 0.7 0.3 2.1 3.4Industry(2) rank NA NA 21 18 15 23 24 7 7 (1) Did not operate (2) All supplemental air carriers

Trans International and Hawaii

LAAS changed its name in 1960 in part to eliminate confusion with Los Angeles Airways, a scheduled helicopter airline. It originally wanted "California National Airlines", changing to "California International Airlines" when National Airlines objected, before settling on Trans International. Originally just a trade name, later in the year LAAS changed the name of the corporation. Coincident with the name change, the airline entered the scheduled market from the west coast to Hawaii flying DC-6B aircraft; its Hawaii representative was Peter Ueberroth, later famous for running the 1984 Los Angeles Olympics.And They All Got Free Air Trip To Tahiti, Honolulu Star-Advertiser, 10 April 1960 TIA's 1960 revenues reflect a far higher level of scheduled service than previously (see Table 1). But from April 1960, the legal status of supplemental carriers was in question and when Congress settled the issue in 1962, it limited supplemental carriers to purely charter service from 1964.

Jets

In 1960 the US Air Force shifted emphasis from using its own transportation service to commercial charters, which it no longer awarded on the basis of competitive bidding. Instead, the CAB set uniform (and much higher) prices for military charters, which were awarded on the basis of participation in the Civil Reserve Air Fleet (CRAF), rewarding airlines that enrolled aircraft in CRAF that the military valued, such as long-range jets and those with cargo capability, and above all convertible (able to carry passenger or cargo) aircraft.

TIA was the first supplemental to fly jets, buying the Douglas DC-8 prototype, "Ship One", which had been upgraded with then-modern JT3D turbofan engines, in June 1962. TIA immediately landed a $6.2 million military charter contract, an amount greater than TIA's total 1961 revenue (see Table 2). In July 1963 TIA was the first airline of any kind to fly cargo jet charters for the military, leveraging the military's preference by acquiring a convertible passenger/cargo aircraft. Kerkorian later said moving to jets "was the real breakthrough." Note the substantial difference in performance between Table 1 and Table 2. Apart from "Ship One", TIA would buy 12 brand new DC-8s from Douglas in the 1960s, all convertible. Military charters boomed because of the Vietnam War. TIA had much lower costs than most airlines, and that plus higher military charter rates and demand for convertible jets resulted in fast growth and high operating margins. For instance, from 1964 to 1965, TIA's revenues grew by 56% while operating margin expanded from 19.4% to 33.0%.

In 1965, TIA's jets brought further benefit. The CAB provided an exemption for TIA (and World Airways) to offer European charters that summer. The CAB wanted more jet capacity and the supplemental airlines already certificated for Europe, Saturn and Capitol, had no jets and a single jet respectively. Obtaining Europe access was fortunate for TIA as it became the key non-military market for supplementals.

+ Table 2: Trans International Airlines financial results, 1961–1970 USD 000196119621963 1964 196519661967196819691970Operating revenue: Military charter 3,960 9,973 10,559 11,591 13,731 18,543 14,034 22,124 22,630 25,832 Civilian charter 198 52 324 2,189 7,064 10,931 13,745 22,617 25,806 33,834 Scheduled 1,524 20 Other 72 6 30 204 1,068 1,371 3,741 3,385 1,579 1,267 Total5,754 10,050 10,910 13,984 21,863 30,846 31,519 48,125 50,016 60,933 Op profit (loss) 176 1,409 2,581 2,710 7,204 9,142 8,629 10,416 4,763 7,809 Net profit (loss) 276 1,280 1,856 1,101 3,890 4,545 5,391 6,535 4,012 2,388 Op margin (%) 3.1 14.0 23.7 19.4 33.0 29.6 27.4 21.6 9.5 12.8Operating revenue: % of industry(1)7.0 9.4 11.8 13.2 15.5 14.7 12.2 14.8 13.8 18.1Industry(1) rank 5 3 4 4 3 3 3 2 3 1 (1) All supplemental air carriers

Studebaker & Transamerica In October 1962, Studebaker, attempting to diversify, bought TIAStudebaker Acquires Supplemental Airline Los Angeles Times, 10 October 1962 for $2.7 million in stock. In 1964, Studebaker reversed course, and in June Kerkorian bought TIA back for $2.5 million in cash, with president Glenn Cramer a significant minority shareholder. To repay the loan the company took to pay Studebaker, Kerkorian took TIA public in April 1965, the first supplemental to go public.Stock Took Off With Airline, San Francisco Examiner, 19 December 1965 In 1966, the airline moved its headquarters from Las Vegas to Oakland, California. In September 1967, Transamerica Corporation, an insurance company then based in San Francisco, offered to buy TIA for stock then valued at $147 million (over $1.3 billion in 2025 terms).Transamerica Plans $147 Million Stock Purchase of Airline Los Angeles Times, 29 September 1967 The transaction closed March 1968.Transamerica Signs For Airline Purchase Sacramento Bee, 12 March 1968 Kerkorian made $104 million. Cramer became president and CEO of TIA and a director of Transamerica.Business Background, Torrance (CA) Daily Breeze, 26 April 1968

Europe

Europe became a uniquely important commercial market for supplementals. By 1974, there were eight remaining supplemental carriers, the so-called Big Five (Capitol, Overseas National (ONA), Saturn, TIA and World) and Little Three (Johnson, McCulloch and Modern). By 1972, TIA had the leading market share in Europe charters, and such charters accounted for 64.6% of TIA's commercial passenger revenue, the lowest such metric of any of the Big Five. For instance, ONA depended on Europe for 99.5% of commercial passenger revenue. The Europe market grew strongly until 1973, when demand unexpectedly plateaued, a situation that became even more challenging in the fourth quarter when fuel prices spiked as a result of the 1973 oil crisis. TIA was already more diversified, relative to Europe commercial revenue, than others in the Big Five. In offering to buy Saturn Airways in 1974, TIA bought an airline that, by the time the deal closed in 1976, had no Europe passenger charter exposure at all.

For further on supplemental air carriers and US-Europe charters see:

Saturn Airways merger