New airline Avelo thinks it's the perfect time to start flying


Avelo airplane.

Source: Avelo

With demand for air journey rising shortly as the U.S. reopens from the Covid-19 pandemic, Andrew Levy thinks it’s the perfect time to launch a brand new airline.

Levy is CEO of Avelo, a low-cost service that can start flying in late April to 11 markets in the Western U.S. — the place there may be little, if any, direct competitors.

“We see light at the end of the tunnel, and it is coming soon,” Levy instructed CNBC as he sat in Avelo’s places of work in in Burbank, California. “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.”

Levy wished to launch Avelo a 12 months in the past, however the pandemic shortly put an finish to these plans. So Levy and his crew spent the final 12 months ensuring Avelo can be prepared when air journey confirmed indicators of coming again. According to International Air Travel Association, the pandemic has price the airline business greater than $380 billion.

Avelo’s technique is to provide low-fares to vacationers in markets or close to airports which have little airline service. That contains locations like Grand Junction, Colorado; Eugene, Oregon; and Ogden, Utah. These are markets or areas the place vacationers sometimes have to route journeys via hubs like Denver or Salt Lake City.

Levy sees huge potential by exploiting the negatives that go together with bigger airports.

“It takes a long time to get there, you have long lines and there are a lot of headaches and hassles,” he stated. “Small airports, quite honestly, are just simply a better experience and I think all customers would agree with that.”

Founder, Chairman, and CEO of Avelo Airlines Andrew Levy speaks at Hollywood Burbank Airport on April 07, 2021 in Burbank, California.

Joe Scarnici | Getty Images

Levy is aware of the small airport technique can repay for a start-up airline, if correctly executed. In the late Nineties, he helped Allegiant Airlines launch service out of small airports like Rockford, Illinois, which is roughly an hour northwest of Chicago’s O’Hare Airport. After a number of years serving to Allegiant develop its operations, Levy moved on to United Airlines. There, he finally turned CFO earlier than leaving in 2018. 

Susan Donofrio, aviation advisor FTI Consulting, thinks Avelo can replicate Allegiant’s success.

“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,” Donofrio stated. 

For now, Levy’s focus is on a clear launch with no hiccups that usually hinder start-up corporations. Avelo takes off with a fleet of three Boeing 737s and plans to add three extra this summer season.

Fitting of a CEO centered on low prices, Levy is having fun with the undeniable fact that he purchased two of the airplanes at a reduction from others in the business trying to unload plane to save hundreds of thousands of {dollars}.

“The two we purchased were probably about a third lower (in price) than they would have been ahead of Covid, so that represented, between the two planes, in the range of a $15 million discount,” stated Levy.

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