New airline Bonza targets half-price fares on 25 routes

World News

Airline start-up Bonza says it plans to launch 25 routes connecting 16 destinations across Australia when it starts operations later this year, with Sydney losing out to Melbourne for a spot on its initial network.

The carrier will be the first new domestic airline in Australia since Tiger Airways was launched 14 years ago and aims to stir up the market with ultra-low-cost fares to regional towns and popular holiday destinations.

Bonza’s full route map includes 25 trips to 16 destinations all across Queensland, NSW and Victoria. Around 80 per cent of the routes are not currently served by any carrier.Credit: Supplied

Chief executive Tim Jordan said Bonza’s fares would be similar to Jetstar’s and around half the price of full-service airlines flying on most of its planned routes. A one-hour flight (Sunshine Coast to Rockhampton or Coffs Harbour) would be about $50 one way on average, while longer flights (Melbourne to Sunshine Coast) would average between $75 and $100 one way.

Bonza, which hopes to start flying around the middle of this year, will reveal on Tuesday it will base its fleet of Boeing 737 Max aircraft at Sunshine Coast Airport and use Melbourne Airport as a second base.

Mr Jordan said that rather than go head to head with Qantas, Jetstar and Virgin on busy routes between capital cities, the airline was focused on flying to new and underserved destinations. “That’s delivering something very different to the market,” he said. “Eighty per cent of the routes are not flown by any other airline at this point. It’s new ground for Australia.”

Avalon Airport, near Geelong, is also part of the planned network along with Albury, Bundaberg, Cairns, Coffs Harbour, Gladstone, Mackay, Mildura, Newcastle, Port Macquarie, Rockhampton, Toowoomba Wellcamp, Townsville and the Whitsunday Coast.

The Sunshine Coast, about 90 kilometres south of Brisbane, is the gateway to holiday destinations including Noosa, Maroochydore and Mooloolaba and will account for 12 of Bonza’s first 25 routes with 37 flights per week to destinations in NSW, Queensland and Victoria.

Melbourne Airport will have eight routes and 22 flights per week, according to Bonza’s planned network based on its first five aircraft, which will enter its fleet by October. It intends to fly up to eight aircraft within its first year.

Bonza will not fly to Sydney Airport immediately after other airports offered better commercial terms and better access to landing slots, but that could change, he said.

“We believe there are opportunities in Sydney to do something different,” he said. “We want the 20 per cent of the population who call Sydney home to benefit from Bonza fares in the future.”

Rex Airline, the regional carrier that launched capital city jet services last year, said recently that it has also struggled to secure permanent slots at the country’s busiest airport.

Qantas chief executive Alan Joyce has previously cast doubt on whether Bonza could find viable routes not already served by existing airlines. But Mr Jordan said his airline had a different business model — it will have a lower cost base and fly on each route only two to five times a week, rather than several times daily.

“We see many, many more opportunities beyond this … stimulated by very low fares, which haven’t been seen in many communities across the country,” he said.

Based on current networks, Mr Jordan said the only route where Bonza would compete directly with Jetstar is Melbourne-Sunshine Coast, and that launch will increase the number of air routes in the country with budget options by 40 per cent.

Bonza is backed by the Miami-based private equity group 777 Partners, which has about $6 billion in assets and is making a significant push into aviation. The outfit owns a minority stake in Canadian budget carrier Flair, which has a similar ultra-low-cost model to Bonza’s, and an aircraft leasing business through which Bonza will lease its jets.

In December last year, 777 Partners increased its order of Boeing 737 MAX aircraft to 68 of the narrow-body jets to feed its affiliated airlines.

Mr Jordan said Bonza’s work with the Civil Aviation Safety Authority to gain certification to fly in Australia was progressing well and on track for it to start operations mid-year. Bonza’s first 737 MAX aircraft should touch down in Australia around late May, he said.

Bonza will be the first local airline to operate the new Boeing 737 MAX aircraft, which was grounded globally for most of 2019 and 2020 after two fatal crashes linked to a new flight control system. The best-selling jet has since been recertified by aviation authorities around the world, including the US, Europe and Australia, following modifications to the system and pilot training. Virgin has 25 MAX aircraft on order, with the first due to arrive from the middle of next year.

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