On Thursday and Friday, the Department of Transportation unveiled the latest round of Small Community Air Service Development Program (SCASDP)…
New U.S. Start-Up Avelo Airlines to Begin Service Offering $19 Fares
New U.S. budget carrier Avelo Airlines has announced its launch date, including initial routes and its onboard services. The carrier will launch flights on April 28 out of its Burbank, Calif. base to 11 cities on the West Coast.
Avelo’s business model is focused on connecting underserved markets that lack nonstop connections. The first routes feature city pairs that currently require connecting services. Avelo bets its cheap, nonstop services will attract passengers away from other major airlines, which Avelo bets won’t follow it into these smaller markets.
“Avelo Airlines was founded with a simple mission – to Inspire Travel. Operating a fleet of Next Generation Boeing 737 aircraft, Avelo offers Customers a refreshingly smooth experience, and time- and money-saving convenience at surprisingly low everyday fares,” Avelo wrote in its route announcement.
“After more than 20 years of steadily shrinking consumer choice, the American flying public wants and deserves more options and lower fares,” Avelo Founder and CEO Andrew Levy, who has prior experience at Allegiant Air and United Airlines, said in a statement Thursday.
“While the legacy airlines are focused on leisure growth out of their hubs, this has left a lot of opportunity on the table for airlines like Avelo to grow unchallenged in underserved markets,” said Susan Donofrio, aviation consultant at FTI Consulting, per CNBC.
Besides Levy, many executives at Avelo bring experience at Delta, Frontier, Hawaiian, JetBlue, Northwest and Spirit.
Avelo’s Initial Routes
Introductory fares will begin at $19 one way, and sales began at 11:00 am Eastern Time on Thursday. Initial destinations from Burbank include Arcata/Eureka, Redding, and Santa Rosa, Calif.; Bend/Redmond, Eugene and Medford, Ore.; Bozeman, Mont.; Grand Junction, Colo.; Pasco, Wash.; Phoenix/Mesa, Ariz; and Ogden, Utah.
Not all services begin on April 28. The first routes will fly to Santa Rosa, Pasco and Bozeman on April 28, April 29 and April 30 respectively, but other routes will not start until as late as May 20.
“Hollywood Burbank Airport exemplifies the convenient, caring and smooth experience that distinguishes Avelo,” Levy added. “We’re grateful for the enthusiastic partnership that BUR Executive Director Frank Miller, the airport’s commissioners and staff have welcomed us with. It’s not surprising why BUR is LA’s favorite airport.””Locals know that BUR is LA’s best airport,” Levy said in Avelo’s statement.
“No airport is closer to downtown LA, Hollywood, Pasadena and Southern California’s many other attractions than BUR. As the San Fernando Valley’s hometown airport, BUR will give you easy access to an abundance of beautiful and relaxing new non-stop destinations across California and the Western U.S.”
Avelo’s fleet includes three 189-seat Boeing 737-800s. The planes’ main cabin includes 129 standard slimline 29-inch pitch seats and a premium section of 60 seats with extra legroom.
Like other budget airlines in the U.S., Avelo cuts down on base fares by adding on extra fees for offers that many consider standard on full-service airlines. Passengers’ first checked bag will cost $10, while a carry-on overhead bag is $35. Passengers can pay $10 for priority boarding and can even bring a pet in the cabin for $95.
For people who want to avoid the discomfort of an aisle seat, you can select to take either a window or an aisle seat for an extra $5.
Avelo’s fees are surprisingly lower than many of its budget competitors in the U.S. Spirit Airlines, for example, charges anywhere from $33 for the first checked bag if purchased during booking to $65 at the gate. Similarly, carry-ons can range anywhere from $35 to $65. Choosing your own seat on Spirit can start at $12, though doing so allows passengers to select a specific seat instead of paying to not be assigned a middle seat.
Avelo’s business model – flying between underserved markets without nonstop flights – should sound familiar, as another airline with the same goal is also preparing to start flights within a few months. Breeze Airways, founded by JetBlue, WestJet and Azul founder David Neeleman, is planning operations with Embraer E190s and Airbus A220s.
Breeze has yet to announce an official launch date for flights, but there are hints that an announcement will come soon. The airline currently plans to announce its intent to start service on April 16, file its schedule on May 3 and launch flights on June 14.
Breeze’s initial route network will likely be completely east of the Mississippi River. Their first cities, though largely unconfirmed, are rumored to include Islip, N.Y.; Gary/Chicago Airport in Indiana; Bentonville, Ark. and Norfolk, Va.
Since they are so separated, Avelo and Breeze will at first be able to grow completely independently as they will not compete on any of the same routes. Both will be able to take substantial presences in their respective markets and have time to independently build their brands and customer bases. But it is almost certain they will cross paths at some point, as both have expressed serious interest in eventually serving New Haven, Conn.
Avelo and Breeze have considerably different online products. While Avelo is going for the bare-bones, no-frills approach, Breeze is aiming for a customer-centric approach that will likely include more room in seats and onboard WiFi.
The two airlines, meanwhile, have a remarkably similar approach of pushing big airlines to bring their costs down. Breeze has said many of its routes will focus on those that have been “abandoned” by bigger airlines, which is a marketing tactic it could use to attract attention from customers disgruntled with high prices and long wait times in big, often-confusing hub airports that may make people nervous during the pandemic.
“There’s been a lot of consolidation over the last 15 years, and now the four largest airlines in the United States control 80% of the seats,” Levy said. “And, of course, consolidation did what it was expected to do, which is take fares higher. We are out there to try to bring choice back to consumers.”
Avelo’s Pandemic Response
Avelo is especially notable for launching its operations in the midst of the coronavirus pandemic. Vaccine rollout in the U.S. is currently speeding up, but the country is not out of the woods yet, and more than half of Americans have yet to receive a vaccine.
Still, many airlines are planning on seeing a big spike in travel over the summer. American Airlines reported in March that “bookings are up by 150-400% compared to last year and within a few points of 2019,” and Delta has reported so many bookings in recent days that they do not have enough pilots to staff all their flights.
In California, Governor Gavin Newsome has announced plans to fully reopen its economy by June 15 as long as vaccines are available for all who want them and hospitalizations are stable. And the Centers for Disease Control and Prevention have said that travel is “lower risk” for fully-vaccinated folks; while not a complete approval and the agency still encourages caution, this will undoubtedly send the message to many vaccinated people that it is OK to book summer travel to finally get out of the house.
“We see light at the end of the tunnel, and it is coming soon,” Levy told CNBC. “We stand in a great place to get started here and especially being up and running for the summer peak season, which should be good.”
Avelo, which originally planned to launch in the spring of 2020, has even been able to use the pandemic to its advantage by getting significant discounts on its aircraft. Levy says that the two 737s the airline has purchased over the past year had a combined discount of around $15 million due to the travel dropoff.
In its statement, Avelo said that “tray tables, galleys, lavatories and all other touch surfaces are sanitized every evening with Calla 1452 (hospital-grade) disinfectant,” adding that it treats its aircraft with “an advanced antimicrobial protectant that kills viruses, germs and bacteria on all surfaces.” It has highlighted the 737’s air filtration system, which refreshes cabin air every two to three minutes, and has promised to offer passengers convenience passengers including hand sanitizer, bottled water and a prepackaged snack.
Avelo is starting relatively small – along with its three planes, it currently has 150 crewmembers – but it plans to expand fairly rapidly. By the end of 2020, the carrier hopes to have at least six aircraft and around 400 employees.
“Demand is coming back quickly. It’s still nowhere near what it used to be so I think in the short term prices will be really low, but we’re built for that,” Levy said.
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