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Despite stalled growth in China, Brazil and Russia, a wave of newly middle-class travelers from the BRICs and beyond will start visiting international destinations in the coming decades — dwarfing the numbers we’ve seen thus far.
The launch’s two years out from now, much will depend on the execution of Odyssey’s plans and on external factors, such as the state of the demand cycle when it launches.
In Homer’s epic tale The Odyssey, it takes Odysseus 10 years to return home after the Trojan War.
Although CEO Adam Scott’s first attempt to start Odyssey Airlines began around nine years ago, he will he hoping for a smoother journey after the planned launch of all-business class flights between London City Airport and New York in 2016.
Odyssey’s business model is based mainly on the convenience of London City and the deployment of the Bombardier CS100 in a 40 seat configuration. It will compete with British Airways’ 32 seat A318 business class-only service from the same airport, in addition to multi-class services from BA, American, Virgin Atlantic, United and Delta from Heathrow.
History has not been kind to premium-only operators on the North Atlantic, whose share of global premium revenues is declining. In spite of this less than encouraging backdrop, Odyssey is not the only airline planning all-business class operations between Europe and North America.
Odyssey will position itself at the high end of the business class segment, promising a “travel experience more akin to a private jet”. This is partly due to the C Series’ larger windows and improved climate control, but also to planned on-board catering, services such as wi-fi and its IFE system, and what it claims will be the longest fully flat beds in the industry.
A clear positioning in the business segment should be preferable to the more blurred positioning of previous airlines in this space. Neither Silverjet nor MAXjet had fully flat beds and established themselves more as discount business class carriers. If Odyssey gets it right, its offer will be clearly superior to that of these two (taking account of both inflight and airport features.
Odyssey certainly appears to have done its homework and has assembled a team with significant experience of the all-business class market. Its strengths should include the size of the London-New York premium market, the CSeries aircraft, London City Airport and launching with a major airline partner (depending on the final choice).
Its challenges will include the lack of a network and FFP with which to attract and retain loyal customers (this could be mitigated by a partnership with a major airline), choosing a suitable New York airport, coping with seasonal fluctuations in demand, pricing strategy and the possibility of a competitor replicating its CSeries-based model.
In Homer’s Odyssey, the hero Odysseus’ strengths are tested to the full by a long series of challenges. At the end, he can only win back his wife Penelope by killing all the suitors that have gathered in his absence. It seems unlikely that Mr Scott’s venture will have such a devastating impact on his competitors.
Ultimately, much will depend on the execution of Odyssey’s plans and on external factors, such as the state of the demand cycle when it launches. The ‘all eggs in one basket’ nature of the premium-only start up airline leave little scope for error or bad luck.
For more on this story, read the full CAPA analysis here.
This story originally appeared on CAPA – Centre for Aviation, a Skift content partner.
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