Francisco A. Lorenzo (b. May 19, 1940 ) is an investment manager, entrepreneur, philanthropist, and a former airline CEO in the United States. Events 1535 - French explorer Jacques Cartier sets sail on his second voyage to North America with three ships 110 men and Year 1940 ( MCMXL) was a Leap year starting on Monday (link will display the full 1940 calendar of the Gregorian calendar. An airline provides air transport services for Passengers or Freight, generally with a recognized operating certificate or license The United States of America —commonly referred to as the
Since 1990, Frank Lorenzo has been president of Savoy Capital, Inc. and professionally devoted to asset management, private investments, and venture capital.
Lorenzo was born to Spanish immigrants in Queens, New York. Spain () or the Kingdom of Spain (Reino de España is a country located mostly in southwestern Europe on the Iberian Peninsula. New York ( is a state in the Mid-Atlantic and Northeastern regions of the United States and is the nation's third most populous He graduated from Columbia University in 1961, working his way through College, selling neckties, waiting tables, and driving Coca-Cola trucks. Columbia University is a private University in the United States and a member of the Ivy League. Coca-Cola is a carbonated Soft drink sold in stores restaurants and Vending machines in more than 200 countries He was admitted to Harvard Business School straight from college, graduated with an MBA in 1963, and went to work in the finance divisions of Trans World Airlines and Eastern Air Lines. Harvard Business School ( HBS) is a renowned Business school in the United States The field of finance refers to the concepts of Time, Money and Risk and how they are interrelated Trans World Airlines ( TWA) renamed TWA Airlines LLC in 2001 was a major U Eastern Air Lines was a major United States Airline that existed from the late 1920s until 1991
In 1989 Lorenzo received the John Jay award for Distinguished Professional Achievement from Columbia University
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Continental Airlines
Pre-deregulation and Texas Air
In 1966 Lorenzo and Harvard classmate Robert J. John Jay (December 12 1745 – May 17 1829 was an American Politician, Statesman, revolutionary, Diplomat, a Supreme Court Columbia University is a private University in the United States and a member of the Ivy League. Carney established an advisory business which provided novel airline management recommendations. In 1969 Lorenzo co-founded an aircraft leasing company called Jet Capital Corporation. In 1972 Jet Capital acquired Texas International Airlines (TI), a struggling regional carrier, based at William P. Hobby Airport in Houston, Texas previously known as Trans-Texas Airways. Texas International Airlines was a United States Airline, known from 1944 until 1947 as Aviation Enterprises and until 1969 as Trans-Texas Airways William P Hobby Airport is a public Airport located 8 miles (13 km) southeast of the Central business district of Houston, Texas
Lorenzo pushed new marketing approaches on the U. S. airline industry, including the first regulator approved low fares (first known as "Peanuts Fares" because some were so startlingly low) and other consumer benefits, like being the first carrier to forbid pipe and cigar smoking on airplanes in 1976 and one of the first U. S. airlines to offer fully computerized airport check-in in 1978.
Lorenzo was active in recruiting a talented and energetic work team. In fact, during the late 1970s, TI was an incubator for much of the talent that would subsequently form the core of other U. S. airlines. Former Lorenzo managers were at some point CEOs, founders, or top executives of existing or new airlines, which included: JetBlue, People Express, TWA, New York Air, Midway Airlines, Chicago Air, Presidential, and others. PEOPLExpress Airlines, also known as People Express, was a US Trans World Airlines ( TWA) renamed TWA Airlines LLC in 2001 was a major U New York Air was a 1980s startup Airline owned by Texas Air Corporation and based at LaGuardia Airport in New York City. Chicago Air was a regional airline carrier that operated in 1986 and exchanged passengers with all-jet Midway Airlines at Chicago Midway International Airport President is a Title leaders of Organizations companies, Trade unions universities, and countries.
The combination of cost rationalization with marketing, pricing, and service innovations returned TI to profitability and in 1977, Lorenzo was awarded the Aviation Week and Space Technology Laureates Award during an event held at the Smithsonian Institution's National Air and Space Museum. Aviation Week & Space Technology, often abbreviated Aviation Week or AW&ST, is a weekly Magazine. The Smithsonian Institution (smɪθsoʊnɪən is an educational and research institute and associated Museum complex administered and funded by the Government of The National Air and Space Museum (NASM of the Smithsonian Institution is a museum in Washington D
New York Air
In 1980 Lorenzo created a holding company for TI called Texas Air Corporation. Texas Air was an Airline Holding company in the United States created to hold and invest in airlines starting with Texas International Airlines Shortly after forming Texas Air, Lorenzo started a new airline called New York Air (NYA), the first post-deregulation airline. New York Air was a 1980s startup Airline owned by Texas Air Corporation and based at LaGuardia Airport in New York City. New York Air was based at New York's LaGuardia Airport, very near the Queens neighborhood where Lorenzo grew up. LaGuardia Airport (ləˈɡwɑɹdiə is an airport located in Queens County on Long Island in the The City of New York. New York Air would become Lorenzo's challenge to the expensive Eastern Airlines Shuttle, and provided cheaper and more frequent (hourly) flights between New York, Boston and Washington-National. The ALPA pilots' union fought it vigorously.
New York Air grew rapidly, adding scheduled services from LaGuardia to Cleveland, Buffalo, Detroit, Louisville, and other cities, before eventually being folded into today's Continental Airlines. Continental Airlines Inc ( is a United States certificated air carrier.
Continental Airlines
In 1981 Texas Air initiated the takeover of Continental Airlines. Continental Airlines Inc ( is a United States certificated air carrier. Texas International was merged into Continental Airlines in June 1982. TI ceased to exist and the "new Continental" relocated its headquarters to Houston. Lorenzo was determined to build Continental into a low-cost full-frills airline, focusing on profitable routes, in order to reach sustainability in the new free-for-all deregulated marketplace.
Lorenzo took Continental into Chapter 11 bankruptcy in September 1983 after extensive negotiations with labor unions proved unsuccessful. Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the Bankruptcy laws of the United States Bankruptcy is a legally declared inability or impairment of ability of an individual or organization to pay their Creditors Creditors may file a bankruptcy petition against Bankruptcy, up to 1984, allowed immediate cessation of union contracts and imposition of new labor conditions, subject to later Court approval and revision. A more streamlined Continental emerged out of bankruptcy shortly after the original filing and the Bankruptcy Court approved management’s measures.
In 1985, Texas Air attempted a takeover of Trans World Airlines. In business a takeover is the purchase of one company (the target) by another (the acquirer, or bidder) Trans World Airlines ( TWA) renamed TWA Airlines LLC in 2001 was a major U Although TWA's management favored Lorenzo over Carl Icahn, TWA's unions feared Lorenzo and negotiated special concessions with Icahn. Carl Celian Icahn (born February 16, 1936) is an American Billionaire Financier, Corporate raider and Private equity TWA's Board eventually accepted Icahn's offer.
Frontier and People Express
In 1985, Lorenzo's Texas Air Corp. made an offer for a Denver-based regional carrier, Frontier Airlines, opening a bidding war with People Express, which was headed by Lorenzo's former TI associate Don Burr. Frontier Airlines was formed by a merger of Arizona Airways, Challenger Airlines, and Monarch Airlines on June 1 1950, with headquarters PEOPLExpress Airlines, also known as People Express, was a US
PeopleExpress placed the highest bid and paid a substantial premium for Frontier's high-cost operation. On August 24, 1986 Frontier filed for bankruptcy and ceased operations. Events 49 BC - Julius Caesar 's General Gaius Scribonius Curio is defeated in the Second Battle of the Bagradas River Year 1986 ( MCMLXXXVI) was a Common year starting on Wednesday (link displays 1986 Gregorian calendar) Texas Air acquired PeopleExpress on September 15, 1986, at the same time gaining Frontier, which reinforced Continental's already formidable Denver hub. Events 668 - Eastern Roman Emperor Constans II is assassinated in his bath at Syracuse Italy. Year 1986 ( MCMLXXXVI) was a Common year starting on Wednesday (link displays 1986 Gregorian calendar)
On February 1, 1987, People Express, New York Air, and several commuter carriers were merged into Continental Airlines to create the sixth largest airline in the world. Events 1327 - Teenaged Edward III is crowned King of England, but the country is ruled by his mother Queen Year 1987 ( MCMLXXXVII) was a Common year starting on Thursday (link displays 1987 Gregorian calendar) Continental Airlines Inc ( is a United States certificated air carrier.
Eastern Air Lines
Lorenzo pursued negotiations with another troubled carrier that suffered the deregulation marketplace, Eastern Air Lines. Eastern Air Lines was a major United States Airline that existed from the late 1920s until 1991 Texas Air acquired Eastern on February 24, 1986 and started working on its turnaround and possible integration with Continental. Events 303 - Galerius, Roman Emperor, publishes his edict that begins the persecution of Christians in his portion of the Year 1986 ( MCMLXXXVI) was a Common year starting on Wednesday (link displays 1986 Gregorian calendar)
Some of Eastern's assets were used to create a world-wide reservation system, System One, and Continental's hub at Newark Airport. Lorenzo divested non strategic assets such as the Eastern Shuttle, which was sold to Donald Trump, and the South American route system, sold to American Airlines. Donald John Trump (born June 14, 1946) is an American Business magnate, Socialite, Television personality, and
The machinist, fight attendants, and pilot unions struck in 1989. A labor agreement needed to be reached under the new Bankruptcy Law.
President George H. W. Bush did not act on a National Mediation Board recommendation to appoint a presidential emergency board to attempt to reach a labor agreement. George Herbert Walker Bush (born June 12 1924 served as the forty-first President of the United States from 1989 to 1993 The Bankruptcy Court named a trustee to run Eastern in 1990. Eastern Airlines ceased operations and was liquidated in 1991.
Divestiture from Continental
In 1990, after having been CEO of Continental and Texas International for 18 years, Mr. Lorenzo sold his controlling interest in Continental Airlines to Scandinavian Airlines System, and stepped down from his CEO role to pursue other entrepreneurial and investment ventures. Scandinavian Airlines System ( SAS) is a multi-national Airline for Denmark, Norway and Sweden, and the leading carrier in the During his eighteen year tenure, the airline grew from 15 jet aircraft and revenues of $225 million, to 350 jet aircraft and revenues of over $5 billion.
Investment Manager
After the sale of his interest in Continental, Lorenzo founded Savoy Capital, Inc. in 1990 in Houston, TX. Savoy is a professional asset management organization which invests on behalf of accredited outside investors.
Philanthropy
Lorenzo is a trustee of The Hispanic Society of America, an institution with a free-entrance museum of Art. The Hispanic Society of America is a museum of Spanish, Portuguese, and Latin American art and artifacts as well as a rare books and manuscripts research The museum is located in NY, and houses the largest collection of Spanish art outside Spain, with major paintings by Velázquez, Goya, Zurbaran, El Greco, and Sorolla. Velázquez, also Velazquez, Velásquez or Velasquez, is a surname of Spanish origin Francisco de Zurbarán ( November 7 1598 &ndash August 27 1664) was a Spanish painter. El Greco' ("The Greek " 1541 &ndash April 7 1614 was a painter, sculptor, and architect of the Spanish Renaissance
Lorenzo has been a donor and contributor to other arts and charitable organizations.
References
- Roy Rowan From Mao to Now, a reporter’s fifty-year pursuit of Powerful People (ISBN 0-7867-0312-1), Carroll & Graf Publishers, Inc.
- Buckley, William F. Jr., [1] Frank Lorenzo & the free market in National Review, September 17, 1990
- The Handbook of Texas [2] Texas Air
External links
- Hispanic Society to move to downtown Manhattan [3] [de:Frank Lorenzo]]
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