[ Airlines ]October 6, 2020 6:00 am ET
By Taylor Rains
Breeze Raises $83 Million Ahead of 2021 Launch
While the coronavirus continues to take a toll on airlines worldwide, David Neeleman’s Breeze Airways has had a stroke of good luck. In August, the company secured $83 million in Series A financing from Peterson Partners and Sandlot Partners. This brings the carrier’s total funding to over $100 million and brings it closer to its 2021 launch goal.
Breeze’s fleet will include Embraer E190/195 aircraft leased from Azul Airlines, one of Neeleman’s other business ventures, and 60 A220-300 jets ordered from Airbus Canada. The first A220 is scheduled to be delivered in August 2021, with the second and third scheduled for November 2021. Then, beginning in January 2022, the carrier will receive one aircraft per month.
Although Breeze’s initial operating plans were changed due to the pandemic, its business model remains the same: operate point-to-point, nonstop routes between underserved small- and mid-sized secondary markets. The goal is to connect these cities by bypassing a hub, making it a convenient, low-cost option for travelers. Breeze explained that it would be saving passengers time and money without compromising the travel experience. The carrier plans to achieve this by implementing innovative technology to create a customer-centric system, similar to JetBlue’s LiveTV and Mint Business Class – another success of Neeleman.
While the carrier has yet to announce exact city pairs, it has revealed that it will start with seven routes along the east coast. These include three from an airport in the southeast United States and four from an “airport further south.” These two will become Breeze’s main hubs, with two more opening in the southeast by July 2021.
The impact of COVID-19 has forced Breeze to delay its initial launch date and abandon its plan to commence service as a charter airline. But the new funding has put the airline on course to launch as a scheduled operator in March 2021.
According to a press release, the money raised will allow the Salt Lake City-based airline to “continue assembling a world-class team, build a first class tech-enabled guest experience, and prepare to launch flight operations in underserved secondary markets in 2021.” Breeze has already hired a complete executive team and has started training pilots and dispatchers.
Both managing partners praised Neeleman, with Sandlot Partner David Jensen saying, “It’s an honor for Sandlot to partner with such an exceptional entrepreneur and founder in David Neeleman. True to form, he’s assembled another all-star leadership team, developed a first-class guest experience, and built an airline that will provide more choices to consumers in smaller, underserved markets.”
Managing Partner Clint Peterson said, “Peterson Partners has enjoyed over 20 years of partnership with David Neeleman, now across three airlines, and we are thrilled to be backing him again. Our mission is to help great people build great businesses, and it doesn’t get better than David Neeleman and Breeze Airways.”
In July, Breeze Airways applied to acquire the air operators certificate of the defunct Compass Airlines. That regional carrier ceased operations in April after passenger demand plummeted, making it at the time the second US airline to fall victim to the coronavirus. While Breeze saw an opportunity when Compass fell, Compass’ chapter of The Air Line Pilots Association (ALPA), and Sun Country Airlines were against the transfer.
ALPA argued if Breeze acquired the certificate, the current labor contract must be honored. Meanwhile, Sun Country objected due to Breeze not having the required regulatory funding. As a result, Breeze dropped its bid for Compass’ AOC and notified the Department of Transportation that it would operate under its own certification.