Avatar Airlines Wants British Airways’ 747s, Makes Unbelievably Generous Offer

Filed Under: Other Airlines

Avatar Airlines, America’s most promising airline startup, has just made an incredibly generous offer to British Airways. Once accepted by British Airways (which surely it will be), this has the potential to change the aviation landscape in the US forever.

What is Avatar Airlines?

There’s not all that much innovation in the US airline industry, and that’s where Avatar Airlines stands out. Avatar understands that the key to success is to differentiate oneself.

Avatar Airlines 747 buzzing a beach

Avatar Airlines plans to fly Boeing 747s domestically in all kinds of markets, operating as a low cost carrier. The airline plans to be a flying billboard (I’ve heard marketing towards birds is extremely lucrative), and the airline will even offer an annual membership where you pay a fee and then get unlimited flights bookable within 72 hours for just the cost of taxes and fees.

Avatar Airlines’ exceptional management team has been working on launching the airline since 1992, but we all know that starting a world class airline takes time. But don’t worry, they’re almost there, and the airline plans to start flying by next year.

Obviously coronavirus has been a bit of a setback, and months back the airline even requested funding through the CARES Act, intended to provide up to $50 billion in support to struggling airlines (and yeah, who said airlines need to actually have airplanes?).

Anyway, there’s good news. If you’re someone who has questioned Avatar Airlines up until now, that’s all about to change.

Avatar Airlines wants British Airways’ 747s

British Airways has just retired its fleet of 26 Boeing 747-400s, and there’s fantastic news for British Airways — Avatar Airlines wants those planes, and it’s willing to offer British Airway equity in exchange for them.

With Avatar Airlines’ brilliant proposal:

  • Avatar Airlines wants British Airways to give it 26 Boeing 747-400s
  • In exchange, British Airways will own a 22% stake in Avatar Airlines; this comes in the form of 11 million preferred shares, valued at a cool $165 million (of course the airline is worth $750 million, why do you ask?)
  • Naturally, remaining shares would then sell when investors realize what a great opportunity this is, and that would cover the working capital needed to start operations

While British Airways is probably already prepared to sign on the dotted line, the deal gets even better than that:

  • Avatar Airlines will give British Airways the privilege of providing maintenance for its 747 fleet
  • Avatar Airlines and British Airways would have a codeshare agreement, so that Avatar Airlines could provide British Airways with feed at its US gateways

Now, British Airways might already have a transatlantic joint venture with American Airlines, which provides said feed along with revenue sharing opportunities. But American also simply can’t do what Avatar Airlines can. Sure, American may have hubs at many of British Airways’ US gateways, but there are so many markets where it doesn’t.

For example, British Airways operates a seasonal London to Charleston flight. American only flies to Charlotte and Dallas from there. But think of all the destinations that Avatar Airlines could serve with 747s out of Charleston, ranging from Albany to Trenton.

As the letter so beautifully concludes:

“There’s an expression ‘the whole is worth more than the sum of its parts’ and that’s exactly how we both need to look at your 400s. COVID-19 created some horrific consequences, but this will be the golden goose of a lifetime left in its wake.”

And this is only the beginning of Avatar Airlines’ journey. The airline will then order brand new Boeing 747-8s, as the airline believes Boeing will restart production of the plane with such a big order:

“Avatar’s financial plan calls for onboarding a fleet of thirty 747-400s during its first three flight-operational years and transitioning to the Boeing 747-8 by means of an IPO at a time when the company is cash-rich, well-branded and loved by the public. (I have no doubt that Boeing would love to put the Dash 8 back into production if it had a cash buyer with an order for 30 additional aircraft).”

The one problem with Avatar Airlines’ business model

Look, Avatar Airlines’ business model is incredible, don’t get me wrong. But I do think the airline is making one mistake — why not go for A380s instead? They’re higher capacity, and several airlines are retiring these planes right now. Think about it:

  • Avatar Airlines could acquire A380s from Air France and Lufthansa, and start providing those airlines with feed in the US (they don’t really need Delta or United, anyway)
  • Then Avatar Airlines could help Airbus restart A380 production, and keep it going until the end of times
  • If the A380 becomes popular again thanks to Avatar Airlines, then maybe Emirates will acquire Avatar Airlines, and then Emirates can start domestic US routes

That’s how all of that works, right?

I’m considering a career in graphic design

Bottom line

After nearly 30 years of planning, Avatar Airlines intends to launch operations by next year. In many ways conditions are perfect for Avatar Airlines now — with British Airways retiring its 747s, Avatar Airlines can just take them over, and in exchange give British Airways an equity stake.

But it goes beyond that, as there’s so much potential if the two companies work together. For all we know, British Airways could drop its joint venture with American Airlines, instead allowing Avatar Airlines to use its 747s to provide feed at US gateways.

I hope flights go on sale soon, because I am oh-so-definitely booking the inaugural flight.

(Tip of the hat to @IshrionA)

Comments
  1. “The sum of the whole is worth more than the parts”

    Great news for Avatar as the 747s are already being taken apart at Kemble and St Athan… just a minor problem for this airline visionary!

    Planereclaimers are selling lots of parts that they take off the 747s so maybe he can just buy all those parts and build some 747s himself? I think this is an absolutely genius move and also cannot wait to join Lucky on the inaugural flight via BA code share!!!

  2. What an amazing investment opportunity! I’m going to have my accountant look into this right away! As many of you may remember, I became a majority stake holder in the flying success story called Baltia. If Avatar is only fractionally as successful, I’ll be thrilled!

  3. @Jeff – What rendering mate? I remember seeing that while landing in LAX yesterday evening. The bird food ad was an amazing idea proposed by the CEO of Avatar Airlines. Can’t wait to try out their amazing A380s!

  4. Is it worth noting that their CEO is prohibited from starting or raising money for an airline due to previous fraud convictions?

  5. I thought for a second that Allegiant already operated Albany to Charleston, which would mean direct competition for Avatar, but then I realized that Allegiant flies Albany to Savannah instead, leaving Avatar Airways without any direct competition on this highly coveted cash cow route.

    Right now, people who fly Allegiant’s Albany-Savannah route have to do the short drive to Charleston, and Avatar realizes that’s obviously too much to ask for Allegiant’s flyers.

  6. Thanks for the laugh! Though, respectfully, maybe you should have CrankyFlier handle the snarky Photoshops – that’s kinda his forte. 😉

  7. I’m 110% sure Alex Cruz will not only jump onboard, but he’ll order the 747s already half destroyed over at St. Athan to be rebuilt. He’ll also grease the wheels over at Boeing to restart the 748 line. This is GENIUS!

  8. I know competition is good, in general, but do I really need another 747 here for my daily ALB-CHS commute? (Is it considered a bit of bad form flying a different big bird into where they are making those gaudy new Dreamliners?) A line-of-succession question: with the abdication of the reigning Queen of the Skies, who shall inherit that crown?

  9. I’ve always wanted to fly on a 747, so this will be great…surely Boise will be a hub, right? Looking forward to BOI-CHS. No more layovers in SLC or ATL to get there!

    Thanks Lucky, this was the laugh I needed for a Friday morning!

  10. The 747 is gone,how can we ever believe something like this would even take place,but a nice read anyway,well done sir!

  11. It’s not April 1st, if the Berliner Kindl Beer might be the cause of that enthusiasm in this article or maybe a night out too long in Berlin . . . . i don’t know.
    But somehow from reading on your page for soooo long, i think, something is NOT right here?!
    A380, B747-8 within US . . . of course, finally a GREAT alternative if the A380 would be in that country so the people there would be able to experience GREAT flying after having not really ANY great airliner there since AWA 747 back in the 80’s, but Charleston . . .
    Really, i think you should have been moving to Bavaria to get a bit more “fresher and cleaner” air!
    😉
    Something is NOT YOU here Ben!!!!

  12. As an aircraft mechanic for a major airline and former britishairways aircraft engineneer left me explain what this plan will fail 1. Yes b747 -400 parts are available at a high cost now sincer parts are limited 2 b747-400 as nit buit to bé a domèstic plane. Doing 3 or 4 cycles a day. So maintenance cost will bé very high. And to stop that’ bleeding of the batt you need high load factors. Also b.a does not win all this 747 the lesseps alot back over16 years ago roughly i remember that’ very will so. No this airline probaly will fail or never take flight

  13. “… intended to provide up to $50 billion in support to struggling airlines (and yeah, who said airlines need to actually have airplanes?).”

    Well the UK government gave a £15 million contract to a shipping company that had no ships and whose T&s were lifted from a fast food restaurant.

  14. There might be a few stored Ilyushin Il-96 that are available for cheap (the price may justify the slightly inferior operational reliability compared to a 747)

  15. Although the A380 is the only other aircraft that will work on the Avatar plan there are several downsides to the aircraft. Those include among others; airport access, and overall price given its more recent age as opposed to the 747s.

  16. Any carrier that would bring the 747 back into USA passenger service is a friend of mine!! It’s my favorite aircraft.

  17. LOL! Swap 747s for A380s?! Hell no! I would fly on a 747 today, now for the A380… never again…. dislike this plane in ANY configuration/class….. wouldn’t fly on it again even if u PAY ME! So glad COVID-19 is retiring this cow mover ❤️!!

  18. YASSSSS!!!

    So if they are a discounter, say, a Ryanair, but in 747’s or better yet, A380’s, imagine how many passengers they can transport once Ryanair’s CEO finally gets that approval to get rid of seats and have people just stand up while in flight? Can we agree that 2500 is a realistic goal?

  19. Sorry, but given the size of these birds, there a’int no way Avatar would operate these planes out of say CHS… and to ALB out of all places. There simply isn’t enough demand.

    Seems pretty obvious that Avatar would operate between the mega metro areas, competing directly with the big boys who have in recent years also have been mainly focusing on the same mega-metros city pairs while neglecting the small and medium-sized markets. This situation has left an opening for the perennially profitable Allegiant to expand around the country flying between cities like CHS and ALB using less than 1x daily frequency. Now imagine trying to operate this route with a 747. Just doesn’t make sense. This is also BTW the market Neeleman is trying to capture with Breeze Airways where the size and economics of the A220 would make much more sense than the 747.

  20. Certainly the airport accessibility of the A380, that is the number of jetways that it requires would greatly restrict which cities to which it could fly.

  21. For the smaller airports – the USAF have a lot of excess B-52s – they could fly over the airport and open the bomb doors and let the passengers out – you don’t have to worry about folk in front of you taking a long time to get off the aircraft.

    They are almost in UAs old colour scheme already !

  22. The 747-8 is cheaper to operate so no A380. Plus 747-400 will be cheaper to acquire and operate than A380 too

  23. I just checked the website of Avatar. Does anyone notice they just use KLM livery with a photoshopped tail logo and that they just took some photos from a casting agency to fill for example their ‘Executive Administrator’ position? It’s like they’re not even trying to be serious.

    Oh, and a nice touch to post a webcam selfie taken in the living room as CEO photo. Much professional, very wow.

    Amazing how people fall for it anyway. Investing in this is like deserving to lose your money, in a way.

    The best aviation comedy since Baltia. 🙂

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