Wednesday, July 05, 2006

Another domestic airline?

An old joke about how you create a millionaire - find a billionaire to invest in an airline.
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Well, some entrepreneurs are going to pour money down a blackhole in the hope they can make a buck out of flying from Auckland to Wellington and Queenstown at least. Fares to be as low as $12 Auckland-Queenstown, $2 Auckland-Wellington, with a start up sale of 10,000 seats at 2c each. (Of course you’ll have security levies etc to pay on top of that).
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The website is here, it is called FirstJet.com and it intends to fly before the end of the year using a Boeing 737. It says it can do it cheap by using planes as billboards (though most of the time these billboards are out of sight) inside and out. I think it will try to be a Ryanair, without the volumes of traffic.
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Hmmmm, interesting. A trial website, without even using the domain name, sounds like bollocks to me. On the one hand, routes like Auckland-Wellington make Air NZ a bucket, so there may be room for a third player, but on the other hand the money is mostly made from business travellers, filling up planes, many paying fully refundable fares with corporate discounts. Those travellers want:
- Frequent flights;
- Connections to other destinations;
- Koru Club.
Tourists get the leftover seats, particularly at off peak times, but without that core business traffic, the airline business is dead unless you can maintain consistent high volumes of traffic.
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Remember, Qantas doesn’t make money on NZ domestic routes, Origin Pacific is barely breaking even. However, good on them for having a go, without taxpayer money – if it succeeds, thousands will be better off, if not, then the market was not there to make it pay. Nevertheless, I doubt that this will be off the ground - it looks like the professionalism of teenagers.

2 comments:

Anonymous said...

Hi Liberty,

Where did you read about this new airline?

libertyscott said...

Aviation news website, can't find the link about it now. The domain has clearly expired too - so maybe they took some sound advice :)