How to Create an Airline

The airline industry has experienced a great deal of turmoil since the World Trade Center attacks of September 11, 2001. The decline of American Airlines, Continental and other "legacy" airlines since the 1980s have allowed regional carriers like Midwest Airlines to thrive. The rising costs of jet fuel coupled with decreased ticket sales among casual travelers have led airlines to increase ticket prices. As you create your own airline, you will need to show that your company can generate consistent ticket sales in a competitive market.

Things You'll Need

• Business plan
• Fleet of airplanes
• FAA flight plans
• FAA airline certification

Instructions

Start an Airline

1. Supplement your business plan's balance sheet and marketing plan with research into market saturation to convince prospective investors. Your marketing plan can feature a logo, company colors, slogan and other elements to building an effective brand. Place your airline in the context of regional and national airlines running through your local airport to answer questions about your ability to compete.

2. Enhance your airline's initial budget with venture capital and commercial loans from local investors. Approach venture capital firms with your business plan to attract investments in assets like planes, hangars and maintenance equipment. Apply for a commercial loan from a local bank to cover initial costs like land leases, certifications and staff payroll.

3. Work with an aircraft manufacturer like Britten-Norman to find a fleet of planes with sufficient seating capacity. Britten-Norman, Cessna and other manufacturers offer small aircraft to regional airlines worldwide. Look for favorable interest rates from your aircraft manufacturer to finance your fleet without wasting your budget on interest.

4. Request quotes from jet fuel suppliers like World Fuel Services to find a long-term fuel source. Provide information on your airline fleet and annual flight mileage to each supplier to produce an accurate quote. Your fuel supplier should have local and regional distributors to reduce transportation costs for your airline.

5. Submit paperwork for a land lease through your home airport's operating authority. A land lease opens hangar space, runways and counter space at an airport to a new airline. Review land lease procedures for building additional hangar space before creating an on-site office and fueling station.

6. Build your airline's staff starting with a crew of qualified pilots and co-pilots. Every pilot working with your airline should be FAA certified and experienced in flying different types of aircraft. You can focus on recruiting ticketing agents, flight attendants and mechanics in the months after you have filled out your flight crews.

7. Develop a set of customer service standards akin to JetBlue's "Customer Bill of Rights" before opening your airline. Your standards for handling refunds, customer complaints, delays and other common problems should be imparted to every airline employee.

8. Complete airline certification and flight plan paperwork for the FAA before starting your airline. Your FAA airline certification review may take 6 months to a year to complete, so submit your application early to avoid delays. Work with your pilots to create FAA flight plans complete with altitude, speed, seating capacity and route details.

9. Research ticket prices offered by competing airlines as you develop your pricing model. Compile a list of ticket prices for each route run by your airline and determine if your operating budget can bear lower prices. Offer varied prices for overnight, weekend and weekday flights with a proportional relationship between flight-time popularity and ticket prices.

10. Pursue creative promotional methods that are overlooked by "legacy" airlines. Start your initial marketing blitz with a pay-per-click (PPC) advertising campaign that will place ads in search engine results. Sponsor minor league sports teams and participate in charity events in your community to increase name recognition in your target market.

Tips & Warnings

• Study flight plans from regional and national carriers to find routes that are overlooked. Offer direct flights from your home airport to small and medium-sized airports that are overshadowed by hubs like Atlanta and New York City. Schedule overnight and late afternoon flights on these routes to help your passengers find the best flight times for their needs. Solicit ideas for airline logos, color combos and slogans from prospective customers in your community. Design a basic website with a survey form that can be filled out by community members. This initial marketing effort will attract attention from local customers and build brand recognition for your airline.

• Limit amenities like pillows, drinks and meals on your airline to keep overhead costs low. The trend in the aviation industry since the 1990s has been to cut snacks, first-class luxuries and movies on regional and national flights. Your airline will lose credibility if you offer hot meals, alcohol and movies and pull these amenities in subsequent months.

References

• FAA Airline Certification
• Britten-Norman

Resources

• FAA Air Carrier Certification
• AVweb
• JetBlue Customer Bill of Rights