Zoom Airlines will begin flights between London Gatwick and San Diego on 20 June and has identified six other niche US routes as it looks to take advantage of legacy carriers” consolidations and capacity cuts.
Speaking at the IEA and Marketforce 3rd Annual Low Cost Air Transport Summit in London today (11 June), Zoom managing director Jonathan Hinkles admitted softening demand from UK passengers but said the US and Canada markets are performing well.
”We think mergers between US airlines ” such as Delta-Northwest - will provide us with opportunities, as some of the smaller hubs within their combined network structure will be further downgraded,” he said. ”Frequency of service on some routes ” for example, San Diego - to their hubs such as Atlanta and Dallas is dropping, which means connections from those places through those hubs to London are actually becoming less convenient, because passengers have higher wait times at the American airports.
”Even though we”re serving those niche markets with low frequency ” maybe two or three direct a week from London ” passengers are more inclined to take them than connect via a hub. As American carriers cut back very heavily first on domestic routes and then, as they”re starting to do now, on international ones too, we see an opportunity.”
Slots at Gatwick have also opened up as, under Open Skies, transatlantic flights per day have gone down from 28 to 18 following shifts to Heathrow or cancelled routes.
”That”s freed up peak slots of which we”ve been able to take good advantage. People don”t like flying from Heathrow, and Gatwick has a strong catchment area,” said Hinkles.
The high price of fuel and its e ffect on low - cost carriers has provided the buzz at today's conference and the meat of many speakers” presentations, and Hinkles ” while admitting Zoom”s fuel costs have gone up $75 per sector per seat in the last 12 months ” said for legacy carriers the increase is actually higher as they burn the same amount of fuel but fly fewer passengers.
”We estimate their costs are going up by around $105 a seat,” he said. ”I was very interested to hear the head of the International Air Transport Association [Giovanni Bisignani] saying he thought fuel price increases would adversely affect low - cost carriers. I think it”s completely wrong. His view was that for us fuel accounts for a much higher proportion of costs ” yes it does, but I think all that underlines is that legacy carriers” costs in all other areas are so high.
”There is a more insidious problem which is customer demand is softening quite markedly because of the price increases prompted by higher fuel bills, but also because of the credit crunch and global economic uncertainty.”