MIflyer12 wrote:lightsaber wrote:CobaltScar wrote:
Maybe there are cheap for a very good reason? Everyone else dropped them like a bad habit.
E190s have high variable costs. So when it was a popular plane, it was pushed out of duty as before the airlines were flying high utilization.
Plane acquisition cost - bought or financed - isn't the biggest cost element for a U.S. passenger air carrier. The cheap fuel of early Covid is gone - we're back at 2019 avg price per gallon. Frontier, Allegiant and Spirit certainly don't make money on 50% load factors -- proof is in the margins. And they all have economies of scale that Breeze does not.
Hence low utilization duty on high demand (yield) only which does require low acquisition costs.
Breeze has chosen the low utilization/high yield model vs. the JetBlue high utilization/low yield model. High utilization requires minimizing variable costs where fixed costs become just a factor of variable costs Low utilization requires workable variable costs while minimizing fixed costs.
Breeze has a workable model in my opinion with just the e-jets. The A220s add many more potential destinations and will, in my opinion, shift part of the service to high utilization thanks to the low A220 variable costs.
Short term, there are so many qualified Ejet pilots looking for employment that I believe that further helps the economics. I agree low oil is over. That is why Ejets won't fly on low yield days. I've become a huge fan of the only fly on high yield days model. The majors have subfleets of used aircraft for this purpose, in my opinion.
I do think there is a limited good profit market with the E-jets, in particular the E190. Perhaps for up to 80 aircraft (but only at the right price). A better potential with the A220. Long term, I expect an all A220 fleet.