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A major milestone reached by Breeze air Ways, the low cost carrier, has become the first US airline and over a decade, to be certified by the FAA as a US flag carrier. That designation allows Breeze to make international flights, unlocking new growth for the four year old company. Joining us now is David Neilaman, a name that you surely know what are familiar with because he was the CEO and the founder of Jet Blue. David, great to have you with us, Thanks so much for joining open interest.
What is your plan for expansion of this airline now that you've gotten this incredibly rare allowance.
Well, we're up to over fifty airplanes.
We're kind of growing every We get an airplane about every three weeks. We have on firm order about ninety AIRBUSA two twenties with an option to go to one hundred and twenty. So it's just doing the same thing that we're doing. We're flying about eighty seven percent of our routes. We have no nonstoft competition, so it's a perfect airplane size. We have first class, we have extra legroom seats and this internationalist faction is going to be great for US because Saturdays are a little bit of
a down day for air travel. But being able to take those airplanes and fly to Kancun and to Puta Khana and to montego Bejamaica is going to be a real great asset for US.
Well, David, for anyone who's not familiar with your resume, every airline you've founded has done something to be disruptive to reshape its home market. Moris with e ticketing, Jet Blue with more comfort for reasonable prices. Youle making secondary cities in Brazil connecting them for breeze airways. What is the disruption here that you're trying to bring into the market.
Well, you know, it's along the same lines of that. I always say, you never start an airline just for the heck of it. You have to start it with the reason. And when I looked at the US market, one hundred and twenty five cities had lost more than twenty five percent of their air service over the last
ten years. So the big airlines were forcing people to all their hubs and cities like Charleston, South Carolina, Huntsville, Alabama, vibrant growing cities you basically had to get on a plane flight to a hub, and so we're just taking people and bypassing hubs and going NonStop, but doing it with luxury. We're not really like a ULCC. We offer first class, we offer extra leg room seats, we offer really loaf airs. We have a kind of a basic
economy equivalent. But then we have these bundles that people love to buy up. And you know, we've got the highest MPs score I've ever seen a d airline I've ever run. So we were voted by tribal Leisures the third best airline in the country picks number one airlines. So it's it's working. This is combination of getting you there for always. When we started, I said, let's get
you there twice as fast for half the price. That's kind of our goal, and do it with options to fly first class or extra leg room, or have free Wi Fi and a lot of things you don't see on a UOCC.
What are your biggest challenges right now, David. I mean, fuel prices have come down, but I guess planes are harder to get more expensive, and labor must be the cost of labor must be rising as well.
Well, you know, for a while it was the pilot situation, and that's totally been been solved. We have twelve hundred applications for we open it up, and we have we have tons of applications. You know, I think staffing at airports, we rely a lot on third party people, so we're really focused on making sure that they're they're doing a
good job and they're keeping us safe. We're coming with the program where we're going to put AI cameras on all of our gates to monitor everything that's going on to make sure that the turn is efficient, but also most importantly safe, making sure that there's no damage story aircraft. So that's that's really something we're really focused on, is being efficient. And you know, our on time percentage has just gone through the roof. I think I think last month we were almost ninety percent on time.
We haven't we haven't.
We didn't cancel a single flight all summer long because we just wanted to get our guests where they're going.
So, you know, it's just really focused on the operation.
I really preach if we if we all less operation, then people will come back and fly some more often, and that's what we're seeing these markets you know, if we go to a market and we see there's about fifteen people a day that travel between two cities, we believe we can turn that to about one hundred a day.
David, it doesn't feel like an industry though, that is split into the haves and have nots and the have nots. You have Spirit, which maybe has its own issue, but
serving a lower income market. Then the big airlines United Delta talking about that they're doing well because of luxury at Bashing yesterday at Atlanta FED conference, saying that you have the lower end of the consumer spectrum, it's tough, and then he goes on to say all of the other airlines are basically going to lose money or come close to losing money again talking to airlines that aren't serving the ultra luxury customer. David, do you think he's right?
I think he's right to a certain degree.
Sure, you know there's a you know, you see now you have Blues rushing to put first class seats in their airplanes, Spirits trying to put first class frontiers adding first class.
So yeah, I mean, I think people want choice.
Southwest Airlines had one product for everybody, free bags, and now they're starting to differentiate. People want to say, great for the free bags, but I don't care about free bags.
I just want to lower fare.
So you have to give choice to your to our guests and along the spectrum and make you feel good about every every bundle that they purchase.
So I've always wondered about investing in airlines because you know, the prices haven't really risen much since I started buying tickets for myself thirty years ago. Right. I remember going to a Grateful Dead concert on the West Coast in the nineties and paying about three hundred dollars for the tickets, and I could still do the same thing today. Why invest in an airline if it's never going to make money over over time.
Well, you know, trading some airlines stocks is a little bit like trading like options.
Basically they're up and down a line.
You know, I think there's a tremendous amount of leverage if you can get everything right. You know, we have, you know, some of the heightst margins in the industry
on routes where we have no NonStop competition. So you know, I think our goal is to create something that is not a kin do an airline something that is, you know, because the challenge that Speamenting too is that their planes got so big they had to overlay Delta United American and that's a really tough business to be in because they can just create basic economy and match everything they
were doing. So it's just finding those markets. We've looked at those markets that have fifteen p ts and we think there's enough market for about four hundred airplanes and we only have fifty. So it's a tremendous growth opportunity and there's a lot of leverage here if you can get it right.
Well, David, you've done it before. We're looking forward to following along your journey with Breeze. David Nielman of Breeze Airways, thank you so much for joining us this morning.