How a controversial boardroom decision set the UK carrier on its way to becoming Europe's largest regional carrier and the UK's biggest domestic airline
Flybe announced with a flourish earlier this month that according to the latest Civil Aviation Authority (CAA) figures it was now the UK's biggest domestic carrier, outstripping BA, bmi and even easyJet.
The airline said that it carried 26% of the total of domestic passengers in the UK in April/May, three per cent more than its nearest rival easyJet. In numbers this was 451,413 passengers.
It was equally proud of its "stunning achievement" that in April and May, just a matter of months after announcing that London Gatwick was to become its 14th UK base, it carried more domestic passengers than any other carrier at the UK's second largest airport.
For an airline which already boasted of being the largest regional carrier in Europe, this was a new and valued feather in its cap. By its own admission, six years ago it was a "distant fifth" in the UK domestic market. Its rise has been remarkable.
While Mike Rutter, the airline's chief commercial officer, says there are several reasons for this ascent, one in particular, a controversial board decision, sticks in his mind.
It was at the beginning of the decade when Flybe was in the throes of deciding which plane type should replace its ageing turbo prop fleet. "Back in the early part of the decade, the marketplace was moving towards 50-seater jet planes.
"But we opted again for turbo props, the Dash Q400 built by Bombardier which are 78-seater planes. Jim (French, Flybe's chairman and ceo) was put in the corner with a dunce's hat. But they have the flight time of a jet with the fuel burn of a turbo prop which was absolutely key for us.
"So when the oil price ratcheted up and the Green movement became more prominent, Jim's dunce's hat came off. We had bought the plane which was right for this market," he said.
Picking the right plane went hand in hand with what Mr Rutter called a "very ruthless focus" on its business model. "In 2002-2003 we took the view on where we could compete and where we could not.
"We did not have to be a low cost carrier but if we are competing with other carriers, we do have to be low cost and better value.
"We could not compete with Ryanair or easyJet in the sun markets - they would kill us. But we can compete in the right markets," he said.
This is what it has tried to do, offering its passengers, many of whom are on business, routes which larger airlines would not touch.
Flybe was founded in 1979 as Jersey European and was acquired a year later by the Walkersteel Group, owned then by the Lancashire millionaire Sir Jack Walker. The airline changed its name to British European in 2000 and to Flybe two years later.
It has been in the last nine years that the airline has begun to expand significantly, moving into the French market in2004, setting up new operations at Liverpool and Norwich in 2005, opening 14 new routes in 2006 and taking delivery of the world's first Embraer 195 aircraft in 2006.
But it was the acquisition of BA Connect, completed in 2007 that catapulted the airline into the front rank. The deal made the carrier the largest regional airline in Europe.
It has also invested $3bn on new aircraft with the last of the old planes being phased out this summer, making its fleet one of the most environmentally sensitive in the world.
Flybe now operates out of 30 airports in the UK and 36 on the continent. It has 190 routes and operates its 77-strong fleet to 13 countries. In 2008 it carried 7.5m passengers.
Its market is 70% UK domestic, 20% continental and 10% European leisure. For many business travellers it is the first choice because of the variety of routes it offers, like Southampton to Aberdeen or Edinburgh.
These are assured plane trips as driving or going by train are not feasible options so it has not been widely affected by the move on some routes, like London-Manchester, to switch from air to rail.
With its franchise agreement signed in 2008 with Loganair, a Scottish regional carrier, Flybe now also serves many island communities - also not susceptible to car or rail.
Mr Rutter said that ne of the "most pleasing" aspects of Flybe's rise was that it was now becoming a serious player on the Continent.
"We are becoming a real player in Germany with the amount of traffic we have been generating," he said. "We are getting more point of sale business in Germany than we are in the UK."
He said they are also riding the recession well although he has noticed a different pattern in business travel bookings emerging.
"The corporate traveller is not booking until the last minute. A while back it was two to three weeks ahead. There is also less corporate travel but we have attracted more leisure," Mr Rutter said.