All 747 Domestic Low Cost Carrier

Tantalum

Tantalum

Final Approach
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San_Diego_Pilot
Interesting... https://onemileatatime.com/avatar-airlines/
Would be cool to see 747s plying the skies again. Exhausting seeing nothing but 737s and A320s everywhere.

From the article..

What Is Avatar Airlines?
Essentially Avatar Airlines wants to launch domestic flights exclusively with 747s. Their argument is that airlines have been switching to smaller and smaller planes on domestic routes, but the per passenger costs are much lower on bigger planes, and that’s why they’ve chosen the 747.

While it’s no doubt true that per passenger costs can be lower on bigger planes, that doesn’t account for the fact that it’s hard to maintain the same yields with bigger planes.

Avatar Airlines Fleet Plans
Avatar Airlines hopes to raise money to buy 14 Boeing 747-400s. Then within three to five years they hope to have an IPO, allowing them to then purchase 30 Boeing 747-8s, which are more fuel efficient and larger.

So essentially Avatar Airlines hopes to be an ultra low cost carrier, with 747-400s that have 580+ seats. That will include 539 economy seats on the lower deck, and 42 “Office Class” seats on the upper deck.

Avatar Airlines Fare Structure
To do the math on how they’ll be profitable, Avatar Airlines is assuming an average load factor of 84%, with an average ticket price of $64 (plus taxes and fees).

...oh and they plan to make them flying billboards
 
Tantalum said:
Interesting... https://onemileatatime.com/avatar-airlines/
Would be cool to see 747s plying the skies again. Exhausting seeing nothing but 737s and A320s everywhere.

From the article..

What Is Avatar Airlines?
Essentially Avatar Airlines wants to launch domestic flights exclusively with 747s. Their argument is that airlines have been switching to smaller and smaller planes on domestic routes, but the per passenger costs are much lower on bigger planes, and that’s why they’ve chosen the 747.

While it’s no doubt true that per passenger costs can be lower on bigger planes, that doesn’t account for the fact that it’s hard to maintain the same yields with bigger planes.

Avatar Airlines Fleet Plans
Avatar Airlines hopes to raise money to buy 14 Boeing 747-400s. Then within three to five years they hope to have an IPO, allowing them to then purchase 30 Boeing 747-8s, which are more fuel efficient and larger.

So essentially Avatar Airlines hopes to be an ultra low cost carrier, with 747-400s that have 580+ seats. That will include 539 economy seats on the lower deck, and 42 “Office Class” seats on the upper deck.

Avatar Airlines Fare Structure
To do the math on how they’ll be profitable, Avatar Airlines is assuming an average load factor of 84%, with an average ticket price of $64 (plus taxes and fees).

...oh and they plan to make them flying billboards
Click to expand...
You have to keep the seats filled—which is always the issue with airlines. They are only more fuel efficient per passenger mile when full of meat bags.
 
The big volume routes are probably business travelers. Like Chicago NYC. Business travelers need frequency and care less about cost. Leisure travel is where this could work, but leisure travelers don’t want to travel far into a hub and pay for parking, so I don’t see how this adds up.


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Interesting... but a hub and spoke model without the spokes? Also, who's going to save the A346's???
 
I get what they're going for. I'm skeptical about it working, but I get it. I think for what they're talking about wanting to do, they're really going to need to try to do a blend of the Spirit/Allegiant sort of model of not having daily flights to pretty much anywhere, but connecting big, major hubs with vacation destinations at very reduced "no frills" pricing.

I'd like to see them be successful.
 
Orlando > NYC, Chicago, LA? Or between big city and cruise port?

I’d rather stick nails in my eyes
 
There was a 747 SR (Short Range) version. But that was decades ago. I think if flying 747's short hops would make money, the airlines would be doing it / going backwards to the days of the mega jets. Most flying is for business, and you choose time of flight over cost. Adding in the fact that the new jets are so fuel efficient, I don't see an edge here.
 
Kenny Phillips said:
You have to keep the seats filled—which is always the issue with airlines. They are only more fuel efficient per passenger mile when full of meat bags.
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That, and people are preferring more scheduling options it seems... maybe if you give these seats away dirt cheap then you can fill the plane.. but one way fares on Southwest, Spirit, etc., are already pretty low and have brand loyalty and recognition.. these people will have an uphill battle if this actually comes to fruition.. I imagine it will not be easy to fill 600 seats for only a couple time slots when you can pretty much go LAX to MIA at just about any time you want on various carrier choices

Still... would be cool to see domestic 747 service. I think DL wast the last one operating a domestic 747 route..
 
Not that I have priced out a 747, but I imagine they sell pretty darn cheaply, so that is in their benefit.
 
Shuswap BC said:
Not that I have priced out a 747, but I imagine they sell pretty darn cheaply, so that is in their benefit.
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There’s a 747-400 on Barnstormers right now. Asking price isn’t listed, or is in a form of currency I don’t recognize. Who wants to call the number and ask?
 
Shuswap BC said:
Not that I have priced out a 747, but I imagine they sell pretty darn cheaply, so that is in their benefit.
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Well, sure, and so do the old kerosine burners like the Citation IISP, Gulfstream III and the Lear 24’s and 25’s. It’s not the acquisition cost, it’s the operating and maintenance costs that burn a hole in your pockets.
 
Ryanb said:
Well, sure, and so do the old kerosine burners like the Citation IISP, Gulfstream III and the Lear 24’s and 25’s. It’s not the acquisition cost, it’s the operating and maintenance costs that burn a hole in your pockets.
Click to expand...

Well understood for sure, I was trying to find the silver lining of this mess.
 
Ryanb said:
Well, sure, and so do the old kerosine burners like the Citation IISP, Gulfstream III and the Lear 24’s and 25’s. It’s not the acquisition cost, it’s the operating and maintenance costs that burn a hole in your pockets.
Click to expand...

Sure, but acquisition is still part of the equation. And note that per the business plan, they want to start off buying 14 747-400s (for "cheap") before updating to 747-8s with their much more efficient engines. Plenty of 747-400s in the boneyard that they could get I suspect. GE actually bought one off of an airline a few years ago as its second flying test bed (other one being a 747-200 I think).

I've basically spent the past almost 11 years flying aircraft that I was able to start flying because of low acquisition costs. Sure, the upkeep is still there, but for the Cloud Nine model the upkeep is easier to keep going than a note on a high dollar purchase item, especially when depreciating the asset doesn't do anything for us financially.

The fact that the big airlines are getting rid of the 747s makes sense because it doesn't fit their business models and long term goals. But that doesn't mean that someone else with a different model couldn't do something with them.
 
Ryanb said:
Well, sure, and so do the old kerosine burners like the Citation IISP, Gulfstream III and the Lear 24’s and 25’s. It’s not the acquisition cost, it’s the operating and maintenance costs that burn a hole in your pockets.
Click to expand...
GSIIIs and Lear 24/25s that aren't stage-3 compliant are dirt cheap - for good reason ;) Good news is the operating costs are low if you can't operate it.

Nauga,
and his stovepipe
 
Their markets would be fairly limited by the number of airports capable of handling 747s.
 
midwestpa24 said:
Their markets would be fairly limited by the number of airports capable of handling 747s.
Click to expand...

Sure, but that would also limit it to airports that probably serve large enough communities such that they could find 580 people to fill a 747 on a given day. Pretty much all of the vacation destinations have long runways to be able to accommodate large, long-haul international flights. They're also not going to be taking off with anything close to full fuel if they're a domestic carrier - remember this is a plane that could do JFK to Johannesburg non-stop - so that would help things.

But even if you look at some of the obvious big airports - NYC (JFK/EWR), BOS, PHL, IAD, ATL, ORD, DFW, IAH, DEN, SEA, SFO, LAX, SLC, even Kansas City could take one, you've already got enough points of origin/destination. Add in popular vacation destinations like Las Vegas, various Florida airports, and you've got a pretty viable network on your low-budget vacation passengers who tend to fly Allegiant or Spirit.

Pilot wise, it'd be similar to the Atlas model where you tend to get pilots into a widebody with fewer hours than you'd ever get into one at the majors. So they'd be able to attract pilots that way for lower salaries based on the equipment.
 
Ted DuPuis said:
Sure, but that would also limit it to airports that probably serve large enough communities such that they could find 580 people to fill a 747 on a given day. Pretty much all of the vacation destinations have long runways to be able to accommodate large, long-haul international flights. They're also not going to be taking off with anything close to full fuel if they're a domestic carrier - remember this is a plane that could do JFK to Johannesburg non-stop - so that would help things.

But even if you look at some of the obvious big airports - NYC (JFK/EWR), BOS, PHL, IAD, ATL, ORD, DFW, IAH, DEN, SEA, SFO, LAX, SLC, even Kansas City could take one, you've already got enough points of origin/destination. Add in popular vacation destinations like Las Vegas, various Florida airports, and you've got a pretty viable network on your low-budget vacation passengers who tend to fly Allegiant or Spirit.

Pilot wise, it'd be similar to the Atlas model where you tend to get pilots into a widebody with fewer hours than you'd ever get into one at the majors. So they'd be able to attract pilots that way for lower salaries based on the equipment.
Click to expand...

Its not just the runways, the terminals have to be able to accommodate a 747. Only the major hubs have gates set up for the jumbos, and those gates are fairly limited. They will face an uphill battle trying to get gate space at many of those airports.
 
Tantalum said:
Would be cool to see 747s plying the skies again. Exhausting seeing nothing but 737s and A320s everywhere.
Click to expand...
Looking back to the 1970's in air travel, to me it was fun watching all the different types of airliners. DC-9, B-727, Concord, L-1011, DC-10, B-747, B-707, DC-8. I'm sure I missed several, that's what came to mind. Air travel was fun back then. I remember my dad handing his 30-06 to the captain on a flight and the captain stowing it in the cockpit...
 
midwestpa24 said:
Its not just the runways, the terminals have to be able to accommodate a 747. Only the major hubs have gates set up for the jumbos, and those gates are fairly limited. They will face an uphill battle trying to get gate space at many of those airports.
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No problem. Most airports large enough to land a 747 have a cargo terminal that they can use.

Ted DuPuis said:
But even if you look at some of the obvious big airports - NYC (JFK/EWR), BOS, PHL, IAD, ATL, ORD, DFW, IAH, DEN, SEA, SFO, LAX, SLC, even Kansas City could take one, you've already got enough points of origin/destination. Add in popular vacation destinations like Las Vegas, various Florida airports, and you've got a pretty viable network on your low-budget vacation passengers who tend to fly Allegiant or Spirit.
Click to expand...
Then you have some of the non-obvious airports that might be able to handle a 747 and have had a decline in passenger operations, like Memphis where NWA had an international hub that Delta eventually shut down. I think that there are airports that could find room for 747 passenger service. But I don't think there is enough demand for a giant cattle car traveling exclusively between hubs to compete with the major airlines. I just searched and you can fly Delta JFK-LAX for $200 in basic economy if you plan ahead a bit. Avatar's market is going to be limited to people buying numerous tickets (families with children, bachelor(ette) parties, and the like), for whom the difference between $50 and $200 per ticket is meaningful.

Even if they find a market, they will be operating on absurdly tight margins. Using real (as in, found by Googling for 3 minutes) numbers, it costs $39-44 per mile to operate a 747-400, which sounds like a direct operating cost figure.[1] It is 2,500 statute miles from New York to Los Angeles. Using an optimistic $40/mile operating cost (whereas reality will be higher when you're talking about buying retired or freighter-configured 747-400's on the cheap), it costs $100,000 to get the plane across the country. The article linked by the OP estimates seat revenue at $31,407 per flight. Just to get the plane from point A to point B, they need to bring in almost $70,000 per flight in advertising revenue from a billboard that spends most of its time well out of anyone's view (except for people who are already at the airport with a ticket on a more comfortable plane). Then they will need to find millions more dollars in other revenue to pay rent at the airports, salaries for gate and customer service personnel, and all the other millions of costs that airlines actually have to pay to survive.

Edit to add: Assuming no non-ticket revenue and total business costs of 3x the direct operating costs of the equipment, and accepting the airline's 84% loading of their flights and mix of seat classes, they need to sell 488 tickets for a total of $300,000, which is an average of $615 per ticket, nearly 10 times their proposed $64. The advertising revenue really needs to happen to make any sense of this at all.

It takes money to get a 172 off the ground. It takes a lot more money to get a 747-400 off the ground with infrastructure and personnel to handle it at multiple places around the country. People with money generally want to keep their money or invest it in a way that will net them more money. While venture capitalists are willing to take risks, I do not think there is a way to convince enough of them to invest in a business model like this for it to leave the ground.

All together, I predict that precisely zero Avatar Airlines flights will slip the surly bonds with passengers aboard. There are simply too many obstacles.

[1] https://www.opshots.net/2015/04/aircraft-operating-series-aircraft-operating-expenses/
 
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The 4 engine jet is going the way of the Dodo. I am not sure who is doing analysis on their business model... however I would bet money this won't get off the ground. The only model I have heard that MAY work for old 747s is having crowdsourced ticketing. What this means is they have to have enough people buy a spot to operate the flight, or they are not going... kind of like a charter. Lots of problems with that model too.
 
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