"This is your captain speaking...." (American Trans Air Inc.) (Cover Story)

"This is your captain speaking," and boy, what stories he can tell. J. George Mikelsons, at 54, is chairman and founder of Indianapolis-based Amtran Inc., senior captain of the American Trans Air fleet, top tour director for Ambassadair and Ports of Call travel clubs and the main man in a number of other flight-related corporations. To say he worked his way up through the company is not quite accurate. It would be more appropriate to say he worked the company up around himself into the largest charter airline in the nation and a commercial carrier with regular, scheduled routes.

Mikelsons is a composed, trim, dapper man with a Magnum P.I. mustache and a distinguishing dash of salt in his brown hair. You'd relax in your seat, sigh and not even bother to check the exits if you saw him at the controls of your jet. As do many pilots, Mikelsons tells a great story. He recalls highlights of his life in a deep, quiet voice and chuckles over some of the hands that destiny has dealt him.

There was that time when he was flying a charter from Indianapolis to Detroit. The single engine on his Cessna 210 started to conk out near Marion. Oil splattered the windshield and he had to look out of the left window to circle and glide down. His three executive passengers were white-knuckled while the engine sputtered and coughed. Mikelsons calmly lined up on a cornfield and did a smooth, dead-stick landing. His passengers, hysterical with relief, jumped on him, hugged him, slapped him on the back and rewarded him for saving their lives by stuffing his pockets with their expense-account money. Mikelsons was in more danger of a bruising from their celebration than from the landing.

He tells about driving with a girlfriend past the old Sky Harbor Airport on the Indianapolis east side and seeing a sign, "Airplane Rides $3.00." He shot the works on a trip for two. That did it. He was hooked. Not by the girl, but by the feeling of flight. Within weeks, he started flying lessons. Borrowing from every fellow Latvian he knew, he bought a 1956 Piper Tri-Pacer for $3,800. He convinced his countrymen that it was smarter to rack up hours in his own trainer than to rent one. So, he had his first plane, with many more to come.

Mikelsons recalls the day in 1973 when he quit his first big job with the Voyager 1000 travel club, where he was chief pilot and operations chief. "I was very sad to leave," Mikelsons says. "I became an entrepreneur by default. It was not that I was so driven to start my own thing. I was with them for eight years, but toward the last, I thought that they were on a course that would spell disaster. So I resigned."

Mikelsons explains his plan to start two corporations, American Trans Air, a charter airline, and Ambassadair, a not-for-profit travel club that would funnel passengers into ATA's seats. He says he couldn't start an airline in those days, several years before airline deregulation of the late 1970s. His plan was to go the travel club route. Government regulations prevented him from advertising to the public. News stories and word of mouth launched the company. The phone started to ring and soon, about 130 members had signed up for his first trip to Orlando, Fla.

What a thrill when he stepped aboard his first passenger jet, a vintage Boeing 720, for that first flight in August 1973. He walked forward to the cockpit, side-slipped into his seat and buckled in. "As a pilot, you always feel good climbing into the left seat of a plane that's new to you," he says. "It's a big turn-on for every pilot in the world. But, when you've bought the airplane, you and the bank, that adds to the feeling. Plus, it was the inaugural flight. Well, mix all of those together, and I was about as high as you can get without being at maximum altitude."

He didn't dwell on the fact that he was risking $25,000 of his own money. He did not worry about the $25,000 he owed First Bank and Trust. His firm was going to fly. But it was a tough three years before the fledgling company inched into the black. Mikelsons was the airline's chief pilot and only captain, promoted the club on the street, answered the phone, sold tours, stocked the galley and washed the plane.

Mikelsons tells about changing costumes six times on every tour. He'd load the baggage in his shirt sleeves, then struggle into his gold-striped captain's coat and put on his visored cap to fly the route. When the plane landed, he'd switch to a plain-sleeved blue jacket with a tour director's badge and race to the hotel to greet the vacationers. When the visit was over, he'd see his guests off in the lobby, strip to his white shirt to reload the plane, then board, always smiling and bowing as the chief pilot. Everybody was so busy having fun few noticed his multiple roles.

Mikelsons can spin a yarn about each of his company's subsidiaries. Start with the holding company, Amtran Inc. It was founded in 1984 to serve as a canopy over a collection of profit centers. "The central piece, of course, is the airline," Mikelsons explains. "But as the airline grew, for example, we set up our own training company. One thing led to another. People started calling and asking us to train their pilots. So we started helping other people, and the result was American Trans Air Training Corp."

A rainbow of logotypes decorates Amtran's slick, color-illustrated annual report. Funny thing, though. No annual report is required, because Amtran is a privately held corporation. Mikelsons is the sole owner and is referred to in the report's text as "the stockholder," but he believes his customers deserve to know the state of his company.

Look at the American Trans Air symbol. The stylized "A" on the left and the other on the right are taxi-ways. The "T" in the center, with a line running down the middle, is the main runway. With his pilot's eye, Mikelsons designed that logo himself. Today, pilots flying "America's Vacation Airline" touch down at similar airports around the world in a fleet of 12 wide-bodied Lockheed L-1011s, four Boeing 757s and seven Boeing 727s.

Amtran has 2,456 employees worldwide. About 1,350 are in Indianapolis. In August 1991, there was a downsizing of nearly 12 percent in staff positions, mechanics, pilots, flight attendants and ticket agents whose jobs were tied primarily to passenger volume. This step followed a terrible year, Mikelsons admits. "1990 has the distinction of being the worst year in the history of the airline industry," he says. In an already weak economy, vacation travel nearly stopped and the Gulf crisis doubled fuel costs. Fare wars flared. "These events cause us to suffer our first loss after 17 years of consecutive service," he adds.

Without military work in the Persian Gulf War, Amtran's $2.5 million shortfall would have been greater. American Trans Air made more trips to the region than any other U.S. passenger airline, 22 percent of the total flown by passenger airlines. It journeyed to the Gulf 494 times between August 1990 and May 1991 in L-1011 jumbo jets that hauled 250 soldiers a trip with 500 pounds of equipment apiece. Desert Storm boosted revenue $48.1 million during that period, but could not replace the tour business that was lost.

That was a temporary setback. "The future will be good for the airline industry," says Mikelsons. "A lot of weak sisters are going by the wayside. Fully a third of the U.S. capacity finds itself in Chapter 11 and this shows how many lines were shaky to begin with. The industry has been plagued by overcapacity for years. Those of us who are alive and well by the summer of '92 will have some pretty darn good earning prospects.

"I think my company will finish in the black. Most of the industry will turn out worse than last year, but we should do about $450 million gross." If so, if Amtran does pull out of the red, it will be one of the very few lines in the country to come anywhere near making a profit. That will be another good story for Mikelsons to tell.

Looking way, way back, Mikelsons remembers a 21-year odyssey that makes Odysseus seem like a suburban commuter. He was born in Riga, Latvia, in 1937. He recalls the Russian takeover of the three defenseless Baltic states. "People were scared stiff. Everybody was hiding. They talked in whispers. The Russians started hauling people off to Siberia."

Mikelsons' father, Rudolfs, had been a child prodigy, a violin virtuoso who toured the concert halls of Europe. When the Russians came, he was giving lessons to a few young students in Riga.

The family endured the occupation awhile, but finally, Rudolfs and his wife, Mirdza, a ballerina, decided they should leave. German forces were withdrawing in ships, but would take women and children only. Men had to stay behind. The elder Mikelsons put George, his mother, grandmother and aunt on board and said, "Don't worry. I'll catch up with you. Trust me. I'll find you."

The boat landed them in Gdansk, Poland. They wandered into Germany with all their worldly goods on their backs and in dusty suitcases. "We got bombed out in one city and moved to another and we were bombed out of there and trekked to another. We'd go by foot, by cattle car, all kinds of ways."

In 1944, the sky above Braunschweig, Germany, was speckled with B-17s, Mikelsons recounts. The Allies attacked daily. Mikelsons peered out from an underground shelter to see spectacular dogfights, tracers streak the sky, 500-pounders wiggle to earth and deadly flashes march closer. he could tell right away that it was better to be up in the air when bombs were dropping than down below. Flying began to look very attractive to him. From then on, he wanted to be, he points, "up there."

"We were in Germany from 1944 to 1949. When the war ended, sure enough, Dad got to Germany and went from one displaced-persons camp to another, until he finally found us. We happened to be in Hanover in the British sector where the Australians were recruiting fairly heavily," Mikelsons relates. They promised free passage and work for two years. "So off we went and landed in Adelaide and were there for 11 years." His father, who was fluent in Latvian, Russian, Polish, Ukranian, German and English, worked as an interpreter in the personnel office of the Kelvinator Corp. "He couldn't connect in music. You had to be an Australian citizen to join the union," Mikelsons explains.

Meanwhile, more than 9,000 miles away, there was this young violinist with the Indianapolis Symphony Orchestra. One day, the ISO conductor, Izler Solomon, complimented the violinist and asked who taught him to play so well. He said he studied in Riga with a talented teacher and soloist named Rudolfs Mikelsons.

George Mikelsons remembers the day a letter arrived from Solomon inviting his father to come to Indianapolis. He compares him to an old war horse hearing the sound of the bugle. "I've just got to go for one more season," he said to his wife and his son. "I can't stand it."

"He dusted that sucker off and practiced 16 hours a day for months," Mikelsons continues. Once he got to the United States, he started writing flowery letters about how civilized the place was and asking, "Why don't we all move here?" George Mikelsons was all for it. He thought he might get a chance to be a pilot in the United States. Lessons were too expensive in Australia. "Ever since the bombers, I was determined to fly," he says.

Two years later, in 1960, after he had finished school and was awaiting a visa, Mikelsons signed aboard a merchant-marine ship. He sailed to the Caribbean and landed in Havana. Scuttlebutt had it that the skipper was about to trade some of his crew to the captain of a rusty old tub tied alongside. It had a hammer and sickle painted on the stack. "They were about to, physically, put me on that vessel, so I jumped ship," Mikelsons recalls.

Mikelsons sailed to Kingston, Jamaica, flew on to Toronto and washed dishes for about six months until his visa came through and he ended up in Indianapolis. His wandering days were over. Well, kind of. He still flies somewhere in the world once a month "on the big ones, and I'm up there all the time in the JetRanger or a Citation."

Mikelsons doesn't dwell on what has been. He has dynamic, visionary plans. Amtran made a strong bid for a Baltic route. "That was probably the worst guess I ever made, because I was sure we would have it. When it went past us to a company that had no financing, no planes, no pilots, nothing, I was shocked. Now it remains to be seen what happens. If they don't start service by April, then we get it. I'm a gambler. Face it. Any entrepreneur is a gambler at heart. I always thought that the Baltics would get their independence. I know (Baltic natives) are industrious and there are a lot of them in the United States. I think there is going to be a lot of trade and commerce and people visiting some of their relatives back and forth. So I'm willing to bet on the fact that the traffic will grow."

There are a lot of head-scratchers up ahead for Mikelsons. "We're going to have three or four monstrous carriers in this country," he predicts, "just like General Motors and Ford in the auto business." The question becomes, how can his company take advantage of that situation? What little nooks and crannies will the big boys overlook that it can profitably exploit? What about the cost of planes? "The two new Boeing 757 extended-range aircraft we are taking delivery on next year are $50 million a copy. You have to plan years ahead to anticipate purchases like that." There is also the question as to whether to remain a privately held carrier or to go public. "What is in the best interest of the airline?" He shakes his head. "These are all questions that tend to keep you awake at night."

Count on George Mikelsons to make solid, deliberate decisions. He loves his planes. He loves his passengers. He loves to fly. Whatever happens will make a good story and Mikelsons will tell it--with gestures.