A little over a week ago, I asked when we would see a new airline in the US. A commenter noted the answer: California Pacific Airlines is hoping to launch service next year out of Carlsbad Airport north of San Diego to cities in the California and in the Southwest. (For some background, Cranky wrote about them about a year and a half ago.)
The short version: they want to launch Embraer 170 service (possibly in a 3-class configuration – seriously) from Carlsbad to Phoenix, Vegas, Sacramento, Oakland and San Jose.
So, like me, you’re probably thinking that that is completely insane. I pondered for a moment then decided I was going to speak to someone I know who would know a bit more about what’s going on over there at CP Air. They asked not to be named in this piece, but I can tell you that the person has at least some clue what’s going on over there. After our chat, I’m 10% less sure that the idea is completely insane. Hear me out:
The airline began the process of getting certified by the FAA back in 2009, but their were sidetracked a bit by the Colgan Q400 crash in Buffalo. Following that accident, the FAA started focusing more on some of the safety aspects of the application. Recently, following a couple of declines and some changes in their management team to get some veteran talent in there, the FAA accepted their application. All signs now point to the carrier getting off the ground in the next year.
If you look at their route structure, you’ll note that Southwest already flies to all of those cities from San Diego. That would certainly seem to sound a death knell for any upstart.
But here’s where it gets (somewhat) interesting: Carlsbad is in the northern part of San Diego county (the area is called North County), an area with nearly a million and a half people who live closer to Carlsbad than to San Diego’s airport. In addition, the region is chock-a-block with corporations flying to that initial set of cities.
OK, fine, there are people who live in the area. Any competitor can come in, lower fares, throw in a ton of capacity, and blow them out of the water, right?
Well, not exactly. Carlsbad’s runway is only 4,900 feet, which is long enough for the 170, but not long enough for the 737s that Southwest flies. Also, the terminal is full once CP launches, so no competitors can even come in until the terminal expands in 3 years or so.
Rather than carrying on the tradition of newly launched low fare airlines (which is the vast majority of new entrants launched since deregulation), they’re more of an old-school regional airline (they’re more Mohawk or Empire Airlines than Southwest. They plan to compete by being far more convenient for North County residents & companies than traveling down to San Diego and by offering a full-service on-board experience.
Their website mentions that those regional jets would have 3 classes. Let’s say that after my chat, I would be quite surprised if they launched with anything by single-class service (or maybe they sell some extra leg room).
My thought? Sure, thanks for asking. I think there is enough business around Carlsbad to attract support from local corporations. The short runway and lack of terminal space will keep competitors out. That’s huge, since capacity dumping and low fares tend to knock off new airlines quickly.
I also think it’s helpful that they don’t have aspirations of growing to 500 planes in 3 years. A small airline can certainly succeed if they stay out of the way of competitors. If CP Air can stick to the script, they may just be around for a while. Assuming they ever launch.