Prepare for take off
As Americans begin to re-emerge from their year inside, the first new U.S. airlines in 14 years — Breeze Airways and Avelo Airlines — are hoping their low-cost services and unconventional flight routes will lure travel-hungry adults away from the behemoth air carriers they know and love, per The Washington Post. But how risky of a bet are they making?
"There couldn't be better timing for what we're trying," claims David Neeleman, founder of Breeze Airways and previously JetBlue. "People want to get away." Added founder of Avelo Airlines Andrew Levy: "I like our chances a lot."
Although the pandemic decimated the airline sector, its effects may have also "created openings for newcomers," specifically budget carriers. Idling airplanes and a smaller number of offered flights means cheaper leases and increased openings at airports, the Post reports. What's more, expert pilots and mechanics let go or "downsized" during the pandemic could be looking for new work, "even at a lower cost."
"The pandemic has incapacitated the major airlines so much," said Dan Bubb, an associate professor at the University of Nevada at Las Vegas, "that it's a great time for upstarts to come in, take some slots at airports, and get planed at a discounted rate."
However, industry analysts are quick to classify the launch of any new airline as risky business, "pandemic or not," writes the Post. High fixed costs, infrequent fliers, and razor-thin margins are all pain points that can plague budget airlines right out of the gate.
George Ferguson, a senior aerospace analyst with Bloomberg Intelligence, said, "When a low-cost airline is born, it immediately begins to die." He added, "All the costs begin to rise after day one."
Read more at The Washington Post.