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Author Topic: Suggestions on expansion  (Read 897 times)

luke3

  • Former member
Suggestions on expansion
« on: November 26, 2012, 02:02:53 AM »
Good evening everyone!
I currently have setup a small regional airlines operating 4 aircraft in a mix of E190/E170 and am turning decent profits, thanks to the decision to expans slowly to absorb initial losses. Right now, probably since I joined later in the game, there are only two possible ways for expansion: opening up to a bunch of 60 pax/day unserved destinations using the E170 or tackling some of the more "popular" destinations with demand between 120/150 pax a day but facing competition from one or two airlines (I could probably win on frequency with the RJs but the one route I tried that on previously did not work out so well).
Any suggestion on which strategy would better be fitted for a small airline aiming at becoming a solid regional operator?

exchlbg

  • Former member
Re: Suggestions on expansion
« Reply #1 on: November 26, 2012, 03:50:40 AM »
I quickly looked over your routes and must say that you are doing quite reasonable things already.Since those 60ish routes are nearer to home, I would serve them first, because you must fly a regional aircraft as often you can per day. They are loosers on long,thin routes.
Noone can say how contested routes will work, because you don´t know, what fare your competition offers. If there are already two others, chances are, that they are lower because of competition, a single operator maybe turned that fare screw up, because of monopoly. There your chances are better. It also depends to what extent you oversupply that route with your flights. First divide all demand per all offered/to be offered flights, there you have the equal part you can expect (later,when RI/CI rise and get equal to competitor). Contesting with smaller planes than competitor gives you an advantage in general, because you need much less customers to fill your bird.You will have to care for those routes a lot (that means, work with fares) to get as much passengers for optimal fare.
In general I would have picked another airplane to start a regional airline with short hops - turboprops. Much less fuel for nearly the same flight time and often shorter turn-arounds make them the winner for your business model.For that reason E-Jets and CRJ´s often loose against them.
« Last Edit: November 26, 2012, 04:03:07 AM by exchlbg »

 

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