New US airline has $19 fares, $10 checked bags and flies out of small airports: Meet Avelo Airlines

The last time a new airline took off in the United States, US Airways and Continental Airlines were still flying, and bag fees weren’t a thing.

It was 2007 and the airline was Virgin America.

Fast forward to 2021: Virgin America is gone, acquired by Alaska Airlines in 2016, US Airways and Continental, too, after their respective mergers with American and United.

Andrew Levy, a former top executive at Allegiant and United, says the changes have given travelers fewer options.

“We went down to a very few number of airlines in the marketplace,” he said. “I think choice is always good.”

Enter Avelo Airlines, the startup airline Levy started thinking about in 2015 and launched Wednesday in southern California. The first flight: Hollywood Burbank Airport in Burbank to Santa Rosa, California, a gateway to northern California wine country.

Avelo, a blend of the Spanish word for bird (ave) and the Latin word for swift (velo), aims to be a “softer, gentler, kinder,” budget airline, Levy said.  

The airline is zeroing in on small airports and routes without competition, or at least routes that didn’t have competition when the airline announced its first flights. Alaska Airlines has since added Burbank-Santa Rosa.

As with his former airline, Allegiant, and fellow discounters Frontier and Spirit, Avelo is offering cheap fares and charging extra for seat assignments and carry-on and checked bags.

“You pay for the things that you value,” he said.

Avelo’s launch was delayed by about six months due to the pandemic. The airline’s investors never expressed it, but Levy admits there were likely doubts about the wisdom of starting an airline when travel was decimated.

“I’m sure that there were people that thought, ‘Man, this is not a good idea anymore,”’ he said. “We raised money at a time that was a totally different backdrop. … Everybody’s making money. It’s been 10 straight years of consistent profitability.”

The pandemic had an upside though: airport space opened up, and airplanes and parts were significantly cheaper. Levy estimates Avelo paid one-third the pre-pandemic rate for its two most-recent planes, a savings of millions of dollars.

“That’s why I feel really good about this,” he said.

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