There are no columns more fun to write than those diving into some obscure little airline that has grandiose startup
plans. This time, it’s California Pacific, but it’s different from most of the others I’ve profiled. First of all, these actually have some money and have a shot at getting off the ground. Second of all, the idea isn’t a bad one. That doesn’t mean I think the plan is perfect, but this is certainly one of the more promising startups I’ve profiled here.
California Pacific, or hilariously enough for all you Canucks, CP Air, is planning to set up shop in Carlsbad, California. Carlsbad lies in north San Diego County, about 35 miles north of San Diego’s Lindbergh Field and 60 miles southeast of John Wayne Airport in Orange County. Today, only United flies to Carlsbad with six daily props up to LAX. That’s it. US Airways used to fly in from Phoenix, but those flights are gone.
So why the heck do we need more service at this airport when it’s surrounded by others? Well it’s really not going to draw from Orange County. Even though it isn’t that far, people in Orange County don’t think about going south for their flights. This is really targeted at people in north San Diego County, and that’s a big group of people. There is a lot of business in North County and traffic can suck driving down to Lindbergh. Then you have to park and wait in line as you do at any big airport. Carlsbad, meanwhile, just got upgraded from a double-wide trailer to a nice and small terminal that is completely efficient. You can roll up and be on a plane in just a couple minutes, so the time savings are dramatic.
Despite the new terminal, however, the runway is pretty short at 4,897 feet. That’s almost a thousand feet shorter than the already very short runways at John Wayne, so they really can’t fly very many types of planes out of there, at least not with a full load.
So what will CP Air be doing? Flying Embraer 170s. These airplanes can fly out of there since the runway is just about the same length as London/City and they fly in there safely (with crazy dive-bombing approach procedures as well). They also have decent range, even on the short runway so they can cover the western US. I might like to see the Q400 here, but they wanted jets and this is probably the right one to choose considering the contraints.
I actually met with one of the guys working on this startup (a frequent Cranky reader), and we spoke for awhile about it. The airline is planning 4 times a day to Sacramento, Oakland, San Jose, and Phoenix. They’re also looking at 3 times a day to Vegas and a weekly trip down to Cabo.
What don’t I like about this? With the exception of the weekly trip to Cabo, these are all Southwest Airlines markets and that’s bad news for CP Air. Yes, CP Air can save you time all else being equal, but Southwest has 13 daily flights from San Diego to Oakland alone. That’s a huge frequency advantage that may very well prevent a lot of North County passengers (who already use Southwest anyway) from shifting to CP Air. If Southwest wants to play hardball, they can, not too mention United and their corporate contracts.
I’m also not a fan of the aircraft configuration. These planes are flying on 1 hour hops yet they’re planning on having First Class, Business Class, and Coach. Seriously? Who needs that? It adds complexity and takes away seat density that you’d really want to have to keep costs per seat low. I’d ditch it and maybe have a couple rows of extra legroom at most if they really think they need it.
Unlike most startups, I like the market area and the service plan, but if I were these guys, I’d be doing everything I could to keep things simple and cut out operational complexity. I’d also see if I could find a way into someone else’s frequent flier program. Maybe Alaska would set up a frequent flier partnership since they do it with everyone else? That would go a long way to attracting business travelers, that’s for sure, though I would be surprised if they could work that out easily.
Another X factor here? The founder. Ted Vallas founded Air Resorts to do the same thing in 1980, and now he’s back again and some of what he says concerns me. For example, he says, “My business plan of 1980 was nearly identical to my proposed plan of 2009.” Things have changed a lot since then, so a statement like that makes me very nervous.
To sum it up, the focus here has to be on the local business guys. Tourism is not going to be a good market here, so they should just forget about it. If people want to go to San Diego attractions, they’ll fly to San Diego. Legoland is right near the airport in Carlsbad, but nobody flies to San Diego just to go to Legoland. North County is not a destination. It’s all about business, so if they can make inroads there, despite their frequency disadvantage then they might be on to something.
