Avelo selects New Haven for New England hub

In late March the Tweed-New Haven (HVN) Regional Airport Authority sought federal funding to grow its flight footprint. It pointed out that Avelo and Breeze are launching this year and either would be well suited to serve its local market. The subsidy funds are not yet allocated but Avelo is not waiting. It plans to establish a base at Tweed with three planes to start, serving a range of markets beginning later this year.

We are very excited to partner with HVN as we begin to build our East Coast operations… Tweed New Haven has enormous potential, and our first East Coast base is great news for Avelo, New Haven, East Haven and other local communities.

– Chairman and CEO Andrew Levy

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As part of the effort Avelo plans a $1.2 million investment into HVN to help upgrade and modernize facilities and operations. The airline anticipates employing more than 100 Crewmembers at HVN by the end of the year, including pilots, flight attendants, customer support personnel, and technicians.

Read More: New Haven seeks a pair of hubs

The $1.2 million price tag matches what the Airport Authority hopes to secure from the US government’s Small Community Air Services Development Program and local contributions.

Avelo’s investment is part of a $100 million project for a new terminal and extended runway at HVN spearheaded by airport operator Avports that will result in the overall creation of up to 11,000 jobs in the area.

There will be untapped markets that have been abandoned during the crisis, like HVN. The problem of finding more underserved city-pairs, very prevalent in the U.S. low-cost market up until 2019, is a non-issue for now. Startups will likely have to be fast to enter these markets before the incumbents return.

-Tweed’s application for the SCASDP grant funds

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Picking the routes

While the airline did not identify specific routes, the airport and its management company AvPorts produced a pretty solid wish list for whomever chooses to operate locally.

It notes that lagging business travel mean “most of HVN’s customers use the service for leisure / VFR (visiting family/relatives)” flights. It also notes that the current American Airlines schedule to Philadelphia “with a one-daily frequency and a 6:00pm departure, is certainly not conducive to HVN’s traffic retention or maintaining customer loyalty.”

Florida markets figure heavily into the demand, with Miami, Orlando, and Tampa showing historically strong numbers.

But Chicago and the Washington, DC/Baltimore area also show strong demand. Whether Avelo wants to dip its toes in those more business-focused markets or not remains to be seen.

A ready supply of passengers

The airport also notes its strong population base, nearly all of whom drive elsewhere to fly. The “natural” catchment area covers about 5.5 million passengers in normal times.

Only 1% of them fly from Tweed.

It won’t take much to shift a useful chunk of those travelers to an alternate airline. Avelo doesn’t need to take all the traffic for the operation to be a success. Just a small sliver should be sufficient to fill those planes and deliver the fare and ancillary value desired.

Fleet diversity

Avelo currently operates three 737-800 aircraft. The plan for New Haven is to mix the fleet a bit, adding the smaller 737-700 into the mix.

The airport features a relatively short runway. The 737-800 would have a roughly 3-hour flight range as configured, but with some potential performance challenges due to the limited operational capacity at the airport. The –700 model offers improved performance which, combined with the smaller overall aircraft, and should see fewer limitations on its operations from Tweed.