New domestic carrier Jam Air takes flight

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New domestic carrier Jam Air takes flight

Unread post by bimjim » Thu Jul 11, 2019

http://jamaica-gleaner.com/article/busi ... kes-flight

New domestic carrier Jam Air takes flight
Wednesday | July 10, 2019

Jam Air Link Express Limited, which began cross-country flights in Jamaica on Monday with its twin-engine Otto aircraft, plans to add a second plane in coming weeks.

The airline was incorporated in May 2019 and received its Otto aircraft in June. It expects to succeed where other carriers failed in the domestic space – by starting small and adding seats only when needed.

“We expect to breakeven in three months,” said Jam Air CEO Howard Levy, a pilot by profession, in an interview with the Financial Gleaner, adding that Jam Air’s operating revenue is forecast to exceed his operating expenses at that time.

“We are using economical aircraft where the operating costs are less,” he said.

Levy, who formerly worked with Airlink International Limited, said a domestic airline can turn a profit, but it has to be nimble. He added that previous domestic carriers suffered from myriad problems independent of their operations.

“When Trans Jamaica, Air Shuttle and Air Jamaica Express stopped, it wasn’t due to losing money. The market can work and is sustainable,” he argued.

Levy said that the company is capitalised with cash without any debt as the “banks are unwilling to lend” funds to an airline start-up.

“The shareholders put up the funds, and we have not borrowed money yet,” he said. “We are not divulging the partners now. But it is made up of aviation people.”

Companies Office of Jamaica records list Roger Sherwood as the sole shareholder and director with Leisa Jerry as Jam Air’s company secretary.

Levy said that Otto aircraft are in heavy demand, with relatively few available in the large aviation market of the United States.

“It’s a good, reliable airplane. It can assess every single aerodyne and airstrip in Jamaica – short-landing and take-off. It is ideal for Jamaica, and it is a rugged airplane with low operational costs and has a proven track record,” he said.

The second Otto aircraft would double Jam Air’s capacity from 19 to 38 passenger seats.

The airline offers four flights per day. Once its load factor has reached desirable levels, the company plans to grow its capacity by two-thirds via a two-step process that includes ending the lease of one of its two Otto aircraft and adding a larger Bombardier Dash-8 plane with a configuration to carry roughly 40 passengers.

That would move its capacity from 38 down initially to 19 and then up to 59 passengers.

Levy said the airline’s long-term plan envisions the addition of two leased Cessna Caravan aircraft –each holding nine to 13 passengers, depending on the configuration – which would increase capacity by at least another 30 per cent.

Levy said the revenue generated from the business will pay for the cost of leasing another aircraft.

The company is targeting busy, time-sensitive commuters. Travel time from Kingston to Montego Bay will span about 28 minutes one-way, compared to three hours by car and four hours by bus.

Luxury coach service Knutsford Express is now one of the most popular choices for the Kingston-Montego Bay commute.

“There are bus people, and then you have plane people. They are two separate markets,” said Levy. “Any modern country that is growing needs communication, proper roads and the quick and fast movement of people,” he said.

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