PlaneRed To Taunt Airlines, TSA

Kieran · Aug 23, 2011

Interesting idea....treating flight as a sort of public transport. Website here: http://planered.com/2vtan

article here: http://www.forbes.com/sites/edzitron/2011/06/29/planered/

Flying sucks. While usually Id choose more elaborate and pleasant language, this industry requires me to be blunt and crass in the same way it treats its customers. For hundreds of dollars, youll suffer cramped quarters, torn seating, rude staff, interrogations, endless (yet standard) wait-times, and overall an experience that makes no sense on the get-what-you-paid-for scale.
Even the best of the best Virgin America only just scrapes the pleasantries of your average cross-country train journey. PlaneReds CEO, Wade Eyerly, wants to fix this shoddy state of affairs:

Tickets work great for things that are a privilege. Movies, concerts, cruises, and so on. Tickets worked great for flying in the 30′s, 40′s, and 50′s because it was a treat. It wasnt something everyone did. Now, flying isnt a treat. For many people, its the bane of their week. Parking, the huge time sink at the airport, the uncomfortable seats, the inefficient routes, the bad food, the TSAs aggressive and unnecessary prodding. Flying sucks. You dont charge tickets for an experience that sucks. You cant make money that way.

And the airlines, by and large, dont. We are constantly reading about bankrupt airlines, unprofitable airlines, and those that are bailed out. Americans have to fly our economy demands mobility. So the taxpayer ends up subsidizing travel. (Dont think so? Ask about the government travel rate on your next flight. Itll be 5 times what you paid.)

PlaneRed is an all-you-can-eat flight subscription launching around September 1st 2011 that will fly just below the TSAs radar using 9-person planes to dodge under their screening of any plane carrying over 10 passengers. The subscriptions will work as such passengers will pay around $150 a month for access to a booking system much like a city bus, able to book on popular routes on the east coast, serving Atlantic City, New York, Philadelphia, Washington D.C.. They hope to expand quickly to Boston, and then open up new runs in Texas, California, and the Midwest. Eyerly sees it as a win-win for customers 14-passenger planes organized in a luxury set-up to make the journey just a little bit more pleasant.

The financial aspects of creating an airline are scary, but Eyerly soldiers on:

Obviously funding is every startups challenge. Right now we are self funded. Funding an airline ourselves seemed daunting at first but it turns out its not. Flying small planes reduced our capital cost significantly. We can control our growth by limiting the number of subscriptions well sell and holding other interest in a waiting list. Then, we convert those waiting into subscriptions as we add new aircraft to the fleet. That way well keep our level of service up for our subscribers, while controlling our cash-flows.

Well sell our subscription seat licenses a few weeks before launching. Then well use those sales (purchase orders) against a prepared loan to execute the aircraft purchases and go from there. In theory, this will give us assets (purchase order) before we incur liabilities (aircraft purchase, and so on) meaning we have very little up-front cost, and our business should be operating profitably from day one. Our only real up-front costs are customer acquisition. It comes down to selling subscriptions. If we can sell enough we fly. If not? We dont.

Theyre seeking VC investment, but only from those who understand what theyre going for and share the pain of the average airline passenger. Anything that lets us fly faster, better, and simpler is welcomed around here.

The first 10,000 signups to PlaneReds website will have access to the initial subscription packages.
Click to expand...

Kds · Aug 23, 2011

I like the sound of the concept......and who doesn't like balloon with kittens inside of them......but does the math work on the economies of scale they will need to be profitable ?

Tcar · Aug 24, 2011

What are they flying?

Turboprops?

teak360 · Aug 24, 2011

Based on their website, I give PlaneRed a .001% chance of success.

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