The sky over the North Atlantic is still very empty. However, a new battle for some of the busiest and most profitable routes in the world has begun.
American airline JetBlue launched its first transatlantic service this week in response to the aviation crisis and promised to start a price war with competitors including British Airways and Virgin Atlantic.
The return fare is 329 pounds in economy class and 999 pounds in business class, which is much cheaper than many competitors.
Within hours of its maiden flight at London Heathrow Airport under a cloudy sky, JetBlue’s British chief executive Robin Hayes trumpeted the “very high fare” over its competitors. .
Hayes said that since his airline announced its pricing plan in May, prices have fallen across the board, and he has been praised for it. “I am 100% sure this is because of JetBlue Airways,” he told the Financial Times.
But JetBlue is not the only airline betting that passengers will rush back once travel restrictions in the United States and the United Kingdom are completely lifted.
Norwegian startup Norse Atlantic Airways said this week that it expects to have a fleet of 15 aircraft flying across the Atlantic by next summer, while Irish airline Aer Lingus has been approved to open flights between Manchester and the United States.
Transatlantic flights are the crown jewel of the global aviation industry. Before the pandemic, with an estimated annual revenue of 9 billion U.S. dollars, established airlines depended on them to obtain a steady stream of corporate customers and wealthy vacationers who were willing to pay high prices to sit in premium seats.
Since Freddie Laker’s Skytrain was introduced to the market in the late 1970s, this lucrative air corridor has attracted ambitious new entrants.
However, few low-cost airlines have achieved success. On long-distance routes, it is often difficult for airlines to achieve profitability without charging high fares, because operating costs such as fuel are much higher.
Norwegian Airline abandoned low-cost long-distance travel last year and reduced it to a smaller regional airline. Wow Air, another low-cost airline that offers transatlantic flights, Went bankrupt in 2019.
The pandemic travel restrictions also continue to curb demand for long-haul flights.
Although vaccinated tourists from the United States can now escape quarantine upon arrival in the United Kingdom, the U.S. border is still closed to non-citizens who have been to the United Kingdom or the Schengen area in the past 14 days.
The impact on airlines whose operations are based on the coast of the North Atlantic has been brutal. British Airways’ flight time this quarter is only about one-third of its regular flight schedule, while Virgin Atlantic’s current capacity is only about half of regular flights, and it has been raising new ones for the past 15 months. Funding to enable it to survive the pandemic.
However, JetBlue entered the market as a mature American airline with a strong domestic and international network and benefited from the ability of American citizens to visit Europe this summer.
Goodbody’s aviation analyst Mark Simpson said it would be easier for JetBlue to compete with existing transatlantic competitors because it offers business class seats while other budget airlines do not.
The economy of JetBlue fares is based on the use of new long-range, fuel-efficient single-aisle aircraft over the Atlantic. Although the Airbus A321LR has fewer passengers than wide-body aircraft such as the Boeing 747 jumbo jet and the 787 Dreamliner, it is also much cheaper to operate.
“They operate narrow-body aircraft and the travel costs are much lower than traditional operators. Each flight operated by JetBlue will be much cheaper, so the possibility of loss is reduced,” Virgin Atlantic aviation consultant and former senior executive Edmund Rose said.
JetBlue will operate daily services between New York and Heathrow throughout August, but to show that the impact of the pandemic is lingering, it will be reduced to four flights a week from September. It also plans to launch a daily service from London’s Gatwick Airport at the end of September.
Nonetheless, an executive from a rival airline pointed out that even if the flights are full, they will only occupy a small portion of the normal transatlantic market.
Hayes said that JetBlue has ordered 6 long-range aircraft and “hopes” to open up to 5 flights a day between New York, Boston and London by next summer.
At the same time, Norwegian startup Norse Atlantic hopes to start flying in the second quarter of next year.
Although the airline has not outlined its route plans, it has leased 15 Boeing 787 aircraft and is applying for a UK operating permit.
CEO Bjorn Tore Larsen said: “We firmly believe that we need a new and innovative airline that serves the low-cost intercontinental market.”
Aer Lingus Aer Lingus received a flight permit between Manchester, UK and the United States this week, using the same smaller and more efficient Airbus aircraft as JetBlue Airways, while French airline La Compagnie has begun connecting continental Europe and the United States Full business class flights.
For industries affected by the epidemic, Outburst of optimism welcome. But it was frustrated by the slow progress.
Gatwick Airport CEO Stewart Wingate said: “In the long run, there are many things to look forward to, but in the short term, in order to allow passenger traffic to recover faster, we do need the government to relax travel restrictions.”