Commentary

Neeleman Expects To Launch Low-Cost Breeze Airways By End Of 2020

Breeze Airways will be the name of name of the low-cost airline JetBlue founder David Neeleman hopes will be flying passengers between underserved mid-size cities by the end of the year. When Neeleman first unveiled plans for a new carrier to serve locations “abandoned by our current air transportation network” in July, 2018, it was dubbed Moxy.

“The new airline, which labels itself as the ‘world’s nicest airline,’ is still applying for its operating certificate with the U.S. Federal Aviation Administration along with the U.S. Department of Transportation,” João Machado writes for AirlineGeeks.

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“‘We’re going to fly where no one else is flying,’ Neeleman said, adding he was considering about 500 city pairs, allowing travelers to bypass connection hubs,” according to an Agence France-Presse story. Delta, United, American and Southwest currently control three quarters of the U.S. domestic market," the story points out.

But Neeleman “hasn’t yet settled on a network,” CNBC’s Leslie Josephs writes.

“Point-to-point flying is a go-to model for discount carriers including Allegiant. Breeze’s chief commercial officer, Lukas Johnson, worked at Allegiant for almost a decade. ‘He understands those markets … and if we have a plane that’s smaller with a lower trip cost, there’s a lot of opportunity,’ said Neeleman,” Josephs adds.

At launch, Breeze will employ 28 Embraer 195 planes it is subleasing from another airline Neeleman founded, Brazil’s AzulJosephs reveals, and it “is also eyeing the possibility of international flying with Airbus A220-300s, which are scheduled to begin arriving April 2021.”

“‘They are separate missions -- one is an apple and one is an orange,’ Neeleman said in an interview. ‘Those planes will never fly on the same route. They won’t be in the same universe, really,’” writes  Brian Sumers for Skift.

Few airlines have tried such a gamble. But Neeleman is calculating a mix of lower fares, more nonstop choices, and better service will ensure Breeze siphons customers from established players. Running what is almost two airlines is a challenge, but if anyone can do it, Neeleman is probably the person,” Sumers continues.

“‘I’m always skeptical about startups, but Neeleman does have an amazing record and is coming into this with an enormous amount of capital. This thing is not going to run out of money fast. In that sense, he will have staying power,’ said Jay Shabat, senior analyst at Skift Airline Weekly,” Sumers adds.

“This will be Neeleman’s fifth airline start-up, following the creation of Morris Air, WestJet, JetBlue and Azul. These four disrupted the markets they were founded in, and Breeze’s plan is to disrupt the aviation market in the United States once again," AirlineGeeks’ Machado writes. “While Morris Air brought the e-ticket to light, JetBlue was the first to count with Live TV onboard and Azul broke a long-lived duopoly in Brazil, the new airline plans to break the high concentration of traffic of the U.S. in fortress hubs.”

“With Breeze, Neeleman won’t offer seat-back video screens or leather seats, two signature features of JetBlue. Instead, fliers will be able to use their personal devices to access entertainment. But he hints at seriously low fares starting at just $69 each way, and WiFi that will likely be free onboard (a popular JetBlue amenity). As for other charges, he says he understands that travelers hate fees, but Breeze will charge for fliers to check luggage,” Barbara Peterson writes for Condé Nast Traveler.

“‘If we’re offering $69 fares, then, yes, we’ll ask you to pay for check a bag,’ he says. Onerous change fees, on the other hand, may be off the table, as he’s looking at alternatives for Breeze's business model to take the fee pressure off of travelers,” Peterson adds.

“The startup will be based in Salt Lake City, where it plans to spend a capital investment of $3.2 million and create nearly 400 jobs over the next five years, according to local authorities. In return, the state offered tax rebates worth as much as about $1.1 million over five years,” Brian Sumers wrote  for Skift in December.

“There’s a super strong technology base, and lower cost of living than California and some of the coastal areas,” chief commercial officer Johnson told Sumers at the time.

Besides, it'll just be a low-cost puddle jump to somewhere near a freeway to L.A.

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