Business class carrier MAXJet positioning for profitable growth

On a recent flight from London Stansted Airport – home of many of UK’s low cost airlines – to Washington Dulles, the fourth flight on this new route, this reporter, experienced MAXJet’s spacious comfortable VIP lounge at Stansted, which is open to all passengers, followed by a comfortable flight onboard their 102 seater B767 aircraft, which offers spacious seating with a deep recline.  The food and wine service was good, the service was excellent, provided by a professional team.  All quite a good value for $1750 round trip.

Dullus based MAXjet Airways began its inaugural service to London on November 1, 2005.  MAXjet now provides service from both New York and Washington D.C. to London, with plans to expand to key business cities – Boston, Chicago, Dallas, and San Jose.

Gary Rogliano, privately held MAXJet’s CEO told TravelMole in a recent interview that the airline was very confident about their business model which capitalizes on the fact that “10% of the passengers generate 50% of the profits” on the trans-Atlantic, while “70% of British Airways’ profits are on their trans-Atlantic” service.  And, the timing was right with some major trans-Atlantic carriers increasing first class seating, while reducing business class.  Using low cost Stansted Airport also help keep costs down.

This is quite a different proposition than the popular low cost economy seating trans-Atlantic airlines of the 70s and 80s – Laker Airways and People Express – who’s business model failed and not replicated since.

There are currently 200 travel agencies who have contracts with MAXJet, said Mr. Rogliano, who encourages more agencies to do so.

When asked about flight connections with London Stansted Airport’s low cost carrier – Ryan Air and Easyjet being the largest,  plus 30 other airlines serving 160 destinations in 34 countries – Mr. Rogliano reviled that there would be an announcement anytime now from BAA Stansted, the airport’s owners, about a new ‘transit hall’.  Since MAXJet flights from the U.S. arrive Stansted in the morning, low cost onward flight connections would be plentiful.  With departures for NYC at 10AM and to WAS at 1PM available incoming connecting flights would be fewer.

At the end of March, for the first time ever, all 102 MAXjet seats were full on the New York flight. On average, loads for March were more than 50% with the latter part of the month coming in at nearly 70%. Bookings for April indicate that the New York route will average at 70% load factors for the month, with bookings for May and June also looking strong.

Mr. Rogliano said,. “We have managed to build up our loads as quick, if not quicker, than any airline developing a new international route. We are currently negotiating for our third and fourth planes to expand the MAXjet fleet.  He added,  “Some 87% of our customers found the experience to be very good or excellent, and 95% of passengers said they would likely fly with us again.”

Reported by Charles Kao