In a vote of confidence for Breeze Airways, the startup has closed a $200 million Series B funding round. Led by funds and accounts managed by BlackRock and Knighthead Capital Management LLC, the airline is getting ready for expansion in the fall with the arrival of the first Airbus A220s. Simple Flying spoke with David Neeleman, Founder of Breeze Airways, about the funding and the carrier’s future. In Mr. Neeleman’s own words, Breeze Airways is here to stay.
Breeze Airways becomes more financially secure
Breeze has closed on a $200 million Series B funding round. This takes the airline’s overall funding to over $300 million in startup capital within three months of operations launch, which is a sizable sum for the airline. The money will support the carrier’s expansion and help bring on the Airbus A220 aircraft due in October.
The airline is approaching the money with various attitudes. According to Mr. Neeleman, the focus is on the following:
“It’s always good to have a nice bank account, but I think, opportunistically, we can receive some really good deals out there on airplanes that we can purchase on the Embraer side– parts and spare engines and different things that can can drive down our operating costs that can make us more profitable. It’s a good use of capital. And then, just kind of sending a signal to all our competitors that we’re here to stay. We’ve got the lowest cost in the industry and got a great balance sheet and a great cash balance, and we’re not going anywhere.”
Breeze inaugurated operations in time for the summer season. With the first flights launching just before the busy Memorial Day holiday in May and, through the remainder of the summer, the airline inaugurated additional new routes. The airline is currently flying to 16 US cities, operating 39 routes.
The airline currently has 13 single-class Embraer aircraft, which it prefers to fly routes under two hours in flying time. The aircraft type has served the airline well thus far, and it is looking at a variety of options with the aircraft, including looking at growing its leased fleet:
“We don’t own any airplanes yet, but we have some great lease rates, so we’d be happy to lease. It just all depends on the price you pay and what the return on capital is.”
One of the most exciting moments for Breeze is expected to come in October when the airline will receive its first Airbus A220. The capital will certainly help finance the arrival of those aircraft and keep a little extra cash on hand to prepare for the winter and fall.
The one wrench that could be in Breeze’s plan is the delta variant. This has caused some hesitation among travelers and led several jurisdictions to reimpose mask mandates and other restrictions. Mr. Neeleman indicated the airline is navigating through that just fine:
“We’ve seen a little impact from the delta variant, but we ran a big sale last week and so bookings were way up.”
Breeze Airways ran a fare sale with $39 introductory fares available for post-Labor Day travel. This helped counteract some drops in bookings that have hit the airline in the last couple of weeks.
At the end of the day, Breeze Airways is showing that it is sticking around in the airline industry. The latest cash infusion will be a huge boon to the airline as it prepares for future growth and the introduction of the Airbus A220s.
Have you flown with Breeze Airways since its launch? Let us know in the comments!