EDITOR'S NOTE: This story originally ran on May 5, 2011, and has been updated to reflect Donald Trump's current status as GOP front-runner.
NEW YORK (TheStreet) -- During a year and a half in the airline business, Donald Trump leveraged up too much, defaulted on his loans, fired the airline's president and then wouldn't make good on the president's contract.
He also improved the property, won praise from the employees and made a little money. "It worked out well for me," Trump said in an interview with TheStreet. "I ran an airline for a couple of years and made a couple of bucks. The airline business is a tough business,but I did great with it."
With Trump the front-runner to snag the GOP nomination, it may be timely to review his stewardship of the shuttle, which he purchased from Eastern Airlines in May 1989 for $365 million, branding it with his name and seeking to bring a luxury to a largely utilitarian segment of the airline business that provided convenient, hourly service in two key markets: New York's LaGuardia/Washington National and LaGuardia/Boston.
In particular, Trump recalls the positive relations with Trump Shuttle employees, many of whom embraced him after moving over from Eastern Air Lines, which had an acerbic labor climate and rundown equipment and facilities. "I was tentative about it at first, but i ended up with some of the finest employees," Trump said. "They worked as hard as any employees I ever had, because they wanted to prove that what was said about them was not true.
"Even today, I sometimes hop on the shuttle, or on a plane back from Florida, and there are people who say 'Thank you, Mr. Trump, for the great job you did at the shuttle.'"
The positive view of Trump was not universal. "Donald was challenging," recalled Bruce Nobles, president of the Trump Shuttle from October 1988 until June 1990. "Like a lot of charismatic entrepreneurs, he tended to be intimately involved in a lot of the details, although he didn't interfere in the operations per se. He didn't really know much about the airline business.
"When I first met him, I told him that old joke about how the way to make a little money in the airline business is to start with a lot of money, and he thought I was kidding," Nobles said.
In fact, despite the industry wisdom, the late 1980s and early 1990s were a time when airlines, for some strange reason, were viewed by many as trophy investments. Even Warren Buffett bought in, later declaring that his US Airways (LCC) investment was his biggest mistake. Trump's own airline itch intensified after the shuttle purchase. In August, 1989, the Miami Herald reported that Frank Lorenzo had several times solicited Trump to buy Continental. In October, Trump bid $7 billion or $120 a share for American Airlines (AMR) .