Our own airline... (Bulletin, 5 December).
Advice: Don’t even think about it!
Dear Sir,
I spent the last 17 years before retirement as an airline consultant analysing, restructuring or, more frequently, liquidating, small airlines such as you propose throughout Europe (including the Canaries), South America, Africa, and the Caribbean. There is also a recent history of failures here in Majorca of just what you propose– remember Futura and Ole Airlines?
Consider the basic economics. A jet suitable for operations to mainland European destinations such as you suggest will have a standing charge of something like USD 250,00 per month, to which has to be added the other fixed costs of insurance, crew, base maintenance, marketing and reservations, etc. These fixed costs will require a flight hour utilisation of some 16-18 hours per day to get the hourly allocation down to a manageable level.
Further, you will probably need two aircraft in order to cover scheduled and unscheduled maintenance, thus almost doubling this utilisation requirement.
Then to these fixed charges has to be added the actual operating costs of fuel (say 5 tons each way per flight to UK or Germany) and, importantly, the ‘cycle’ costs (each take off and landing) that affect engines, undercarriages and many other elements in addition to landing and handling charges, thus ruling out the multi-landing option sometimes suggested.
Where are 2,000 passengers per day –roughly based on 80% occupancy and an average two and a quarter hours flight –going to come from? Certainly not Majorca in the winter season however many hotels you can persuade to lose money. (Spring and autumn visitors are primarily cyclists that come with their bikes on the ferry, or apartment/villa owners who don’t need hotels). Those seeking sun will go somewhere where it can be guaranteed.
One final point. We already have our own Majorca airline, Air Europa, who have a very competent team of market analysts and strong relationships with the tourist trade. They wisely gave up on scheduled services to Gatwick some years ago.
Brian Pocock
Santa Eugenia
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