By Allison Lampert
MONTREAL (Reuters) - Breeze Airways is taking early steps to fly to international sun destinations and parts of Europe, the founder of the U.S. low-cost domestic carrier said on Tuesday, as more airlines seek higher-yield routes outside of the United States.
Breeze is seeking flag carrier approval from the Federal Aviation Administration (FAA) that would eventually allow it to take advantage of "peak of the season" travel to destinations like Ireland, Breeze Chief Executive David Neeleman told reporters in Montreal.
The carrier began air service on Tuesday in nearby Plattsburgh, New York, which sees demand from Montreal travelers.
While a travel boom has delivered strong earnings this year for North American legacy carriers, U.S. no-frills airlines have struggled to return to sustainable profitability due to weaker yields on domestic routes and strong demand for flying abroad.
Breeze, which launched in 2021 by using smaller 137-seat Airbus A220 jets to serve secondary U.S. cities that do not have direct service from larger carriers, is taking advantage of cuts to regional routes by larger airlines.
Breeze is starting service in January in Burlington (NYSE:BURL), Vermont where low cost carrier JetBlue Airways (NASDAQ:JBLU) Corp is cutting service.
“These pockets of pain that are being created, because either there is no air service there, it’s gone away completely, or it’s just regional planes going to hubs, has created hundreds and hundreds of market opportunities for us,” said Neeleman, who founded five commercial carriers including JetBlue.
“The market has changed dramatically and it has created big opportunity for us."
While Neeleman said U.S. domestic fares "have bottomed out" and will not likely go any lower, he said ultra low-cost carriers (ULCCs) have been hard-hit by a strategy of growing quickly with larger aircraft that need to be filled in markets where they are not making money.
“We’re seeing absolutely obliteration of ULCCs in the U.S. right now."