As 2023 ended, parking lots at Wilmington Airport remained near capacity as Avelo Airlines drew holiday passengers from Delaware and the Delaware Valley. Hundreds of close-in spaces are available as of today.
It was a hopeful sign as the airline pares its schedule over the winter to Florida destinations. It’s partly the result of scheduled maintenance that will take Boeing 737 jets out of operation for a time. Another factor may be efforts to improve the bottom line.
We received a few answers on Avelo’s finances late this month as federal regulators posted third-quarter stats.
We now know that Breeze, a new airline that, like Avelo, is targeting small cities, losses so large that industry observers are beginning to wonder if it can remain in the air.
According to critics, breeze flies about twice the number of jets as Avelo and has a hodge-podge of routes. Many of its jets are new and comfortable but add to its debt burden. Avelo, by contrast, flies less expensive older jets, although it faces higher maintenance and fuel costs.
Still, Avelo appears to be in much better shape. The Enilria site (airline spelled backward) crunched the numbers and found the airline’s financial performance compared favorably with Jet Blue, which is attempting to acquire low-fare carrier Spirit.
Enilria has wondered about Avelo choosing Raleigh-Durham as a base, given the level of competition from airlines wanting to serve the booming Research Triangle. The CEO and founder of the airline, Andrew Levy, stated that Raleigh-Durham’s service was an experiment of sorts in determining if the Avelo model would work in a more competitive market.
The One Mile at a Time site also looked at the numbers and noted that Avelo’s losses are manageable. The post noted that the airline might even be profitable if labor costs had not soared post-Covid.
The mid and long-term future is clouded by the challenges of operating a small airline, even if Avelo moves into the black. The best outcome would be a public stock offering. The more scary outcome would be selling out to a bigger airline that might screw things up. It’s happened before.
Another challenge will come in getting passengers to pay higher fares. With the cost of running a jet at $7,400 an hour, $29 one-way bus fares won’t cut it. Fares are now running in the $80-$90-one-way range out of ILG.
Enirilria nor One Mile at a Time mentioned the Delaware airport in recent posts. Still, service here shows signs of the success reported at Avelo’s top bases in New Haven, CT, and Burbank on the West Coast – at least regarding Florida destinations. Routes entering their second year tend to benefit from increased awareness and repeat customers in their respective markets.
Another thing working in Avelo’s favor is fewer than average flight delays and cancellations and generally good word of mouth.
Breeze, by contrast, may have missed a golden opportunity when it bypassed Wilmington (ILG). – Doug Rainey, chief content officer.
