Creating a new Airline-For-Hire for A380 Superjumbos
Strategy Inc. has been touting to several major airlines, for some time now in anticipation of their A380 lease terminations, the concept of creating a generic Airline-For-Hire extending the commercial life of non-renewed lease A380s. This concept, together with additional enhancements and options devised by Strategy Inc. suit low-cost operators who want to get established ‘instantly’. It has taken a new ‘lease of life’ so to speak from the reassurance of the viability of this aircraft by today’s new Emirates $20B order placement.
Late last year, an Irish aircraft leasing company has decided to create its own airline because it can't find anyone to lease its A380 superjumbos. Dublin-based Amedeo counts 12 A380s under management and has a further 20 on order from Airbus, but such is the lack of interest in the world's largest passenger plane that it has been unable to renew its leases, or find new customers, despite months of negotiations.
So it is launching its own A380-only airline. According to Mark Lapidus, Amedeo's chief executive, the new airline's business model will see it offer seats to existing carriers or to potential non-traditional aviation arrivals such as Airbnb. Passengers would buy their tickets through another company, while Amedeo would operate the flight, using its own cabin crew but tailoring the service to suit the client, ahead of brand-led services, higher prices and lesser convenience than Brand airlines or others can offer to passengers.
Portugal's Hi-Fly is a classic example of this so called "wet-leasing", with a successful fleet of 70 aircraft including an A380, supporting carriers like Norwegian and other on Transatlantic flights. Apart from the aircraft they include 'Ready-to-go', fuel, crew, food, pilots and even the airline certificate.
"Joint ventures and codeshares are making passengers feel accustomed to buying tickets with one [airline] but flying with another," Mr Lapidus told The Financial Times. He added that Amedeo would apply for an air operator's licence during 2018.
The growing collection of low-cost airlines offering long-haul flights, such as Norwegian, WOW Air, Level and AirAsia X, would be obvious targets for Amedeo and Hi-Fly. Mr Lapidus said it was in early discussion with a number of possible customers, including non-aviation firms like Airbnb who are looking for a simple and effective way to enter the market.
In January, Mr Lapidus said the A380 needed "disruptive" airlines to secure its future, citing Norwegian, and suggested that the model was a natural fit for budget airlines willing to squeeze in more economy class seats. While the A380 is certified to carry up to 868 people, most operators use a two- or three-class seating configuration which means it carries far fewer in practice. On some flights, Emirates, for example, carries 399 economy class passengers, 76 in business class and 14 in first class, for a total of just 489.
“For them the premise should work well,” said Mr Lapidus. “They keep [the] customer, they keep the margin, we just charge a transparent, very competitive utility return on a capital fee.”
“The airline would be designed not to create a model that competes with airlines but a model that services airlines and fills the gaps in their network by offering them a lift service that goes well beyond the traditional chartering concept,” his business case argues.
Additional reporting by The Telegraph, Tanya Powley, Financial Times