Forbes Article: US Global Airways; Stewart To Paris/Tel Aviv
May 15, 2017
Can Boeing 767 Flights From Stewart Field To Paris And Tel Aviv Enable a Startup's Success?
Let’s just say upfront that startup airlines don’t usually become successful airlines. This is a fact of life in the airline industry, one that is known to Anthony Koulouris, CEO of startup US Global Airways.
Nevertheless, in March 2018, US Global intends to begin Paris and Tel Aviv flights from Stewart International Airport, about 60 miles north of Manhattan. It would lease Boeing 767s from longtime aviation entrepreneur Connie Kalitta.
Koulouris said he is on the path to raising $50 million. The Federal Aviation Administration must certify airlines before they start to fly, evaluating both safety and financial fitness.
On the plus side, Kalitta has agreed to a lease deal that is “below market price, based on the relationship,” according to Koulouris {The market rate is around $200,000 monthly) and Stewart may be an underutilized airport that is about to be discovered.
Or it may be an airport that is underutilized because it is hard to get to. Certainly, you cannot get there by subway or PATH trains.
US Global’s initial planned destinations are Paris Orly Airport and Tel Aviv.
Competition is tough. United has an international hub at Newark while American and Delta have international hubs at JFK. All three serve Paris while Tel Aviv has United service from Newark as well as Delta and El Al service from JFK. American cancelled Philadelphia-Tel Aviv in 2016 because it could not make money, even at a major East Coast hub.
For American, Delta and United, the trans-Atlantic has been the toughest region, in terms of unit revenue trends, for several quarters, even though all three are all in global trans-Atlantic joint ventures with big European airlines. Those JVs control about 80% of trans-Atlantic capacity. Other entrants include low cost carriers led by Norwegian as well as subsidized Emirates, which flies Milan-New York and Athens-Newark.
None of this discourages Koulouris, a 47-year-old Cleveland native who earned an MBA from Fordham and spent three years at Morgan Stanley and 22 years at Merrill Lynch, much of the time involved in sales and trading for a private client group.
In 2011, Koulouris was named vice president of marketing for Baltia Airlines, founded in 1989 with an aspiration to fly JFK-Russia.
Baltia became a joke in the airline industry; it never flew a single flight, it consistently failed FAA certification tests, and a former executive was charged with Securities and Exchange Commission violations because he sought to sell stock illegally. Founder Igor Dmitrowsky died in 2016.
Koulouris, who says he invested about $1 million in Baltia, became a harsh critic.
“I am an investor who came in; they asked me to run marketing,” he said. “I was very displeased with the direction of the company: it was very myopic, very ego-driven. They weren’t able to execute and I was treated like crap.”
Late in 2016, Koulouris took over. “I put together a tougher business plan {and} I cleaned house,” he said. He brought in Kalitta, who was briefly a board member and is now a lessor. From the old board, only chief operating officer Sheryle Milligan remains.
Koulouris said FAA has agreed to re-engage with the airline. He wants to reclaim the early steps of Baltia’s certification process, but he is also considering purchasing an existing certificate from another carrier.
As Koulouris envisions it, US Global Airways will have lower costs and good service. The aspiration is not unique. So the bet is really on Stewart. Baltia had planned to fly JFK-Russia.
“I’m watching a C17 take off now,” Koulouris said Friday, as he looked out the window of his Stewart office. “Kennedy is oversaturated: Stewart is wide open.”
After Paris and Tel Aviv, potential US Global destinations include London, Barcelona, Nice, Naples, Athens, Warsaw, Budapest, Prague, and St. Petersburg, Russia.
The fleet would consist initially of three-class Boeing 767s, although Koulouris said the goal is to fly the more efficient Boeing 777. He said Kalitta “will bring on {767s} as we need them” but could also provide 777s.
In recent years, The Port of New York and New Jersey has managed to lure Stewart service by JetBlue to Fort Lauderdale and Atlanta; American Eagle to Philadelphia; Delta Connection to Detroit and Allegiant to Myrtle Beach and seasonally to St. Petersburg, Fla.
In June and July, Norwegian Air Shuttle will begin flights to four secondary European airports, using Boeing 737 MAX jets with 189 seats. That ought to provide an initial test for the airport.
“I’m a businessman,” Koulouris said. “I try to find things that don’t exist. I would not fly over the Atlantic with a narrowbody. I am not looking to pile people in.
“We want to create our own signature style,” he said. “Right now, the key is to become operational.”
https://www.forbes.com/sites/tedreed/2017/05/...4412ab7034
BLTA
May 15, 2017
Can Boeing 767 Flights From Stewart Field To Paris And Tel Aviv Enable a Startup's Success?
Let’s just say upfront that startup airlines don’t usually become successful airlines. This is a fact of life in the airline industry, one that is known to Anthony Koulouris, CEO of startup US Global Airways.
Nevertheless, in March 2018, US Global intends to begin Paris and Tel Aviv flights from Stewart International Airport, about 60 miles north of Manhattan. It would lease Boeing 767s from longtime aviation entrepreneur Connie Kalitta.
Koulouris said he is on the path to raising $50 million. The Federal Aviation Administration must certify airlines before they start to fly, evaluating both safety and financial fitness.
On the plus side, Kalitta has agreed to a lease deal that is “below market price, based on the relationship,” according to Koulouris {The market rate is around $200,000 monthly) and Stewart may be an underutilized airport that is about to be discovered.
Or it may be an airport that is underutilized because it is hard to get to. Certainly, you cannot get there by subway or PATH trains.
US Global’s initial planned destinations are Paris Orly Airport and Tel Aviv.
Competition is tough. United has an international hub at Newark while American and Delta have international hubs at JFK. All three serve Paris while Tel Aviv has United service from Newark as well as Delta and El Al service from JFK. American cancelled Philadelphia-Tel Aviv in 2016 because it could not make money, even at a major East Coast hub.
For American, Delta and United, the trans-Atlantic has been the toughest region, in terms of unit revenue trends, for several quarters, even though all three are all in global trans-Atlantic joint ventures with big European airlines. Those JVs control about 80% of trans-Atlantic capacity. Other entrants include low cost carriers led by Norwegian as well as subsidized Emirates, which flies Milan-New York and Athens-Newark.
None of this discourages Koulouris, a 47-year-old Cleveland native who earned an MBA from Fordham and spent three years at Morgan Stanley and 22 years at Merrill Lynch, much of the time involved in sales and trading for a private client group.
In 2011, Koulouris was named vice president of marketing for Baltia Airlines, founded in 1989 with an aspiration to fly JFK-Russia.
Baltia became a joke in the airline industry; it never flew a single flight, it consistently failed FAA certification tests, and a former executive was charged with Securities and Exchange Commission violations because he sought to sell stock illegally. Founder Igor Dmitrowsky died in 2016.
Koulouris, who says he invested about $1 million in Baltia, became a harsh critic.
“I am an investor who came in; they asked me to run marketing,” he said. “I was very displeased with the direction of the company: it was very myopic, very ego-driven. They weren’t able to execute and I was treated like crap.”
Late in 2016, Koulouris took over. “I put together a tougher business plan {and} I cleaned house,” he said. He brought in Kalitta, who was briefly a board member and is now a lessor. From the old board, only chief operating officer Sheryle Milligan remains.
Koulouris said FAA has agreed to re-engage with the airline. He wants to reclaim the early steps of Baltia’s certification process, but he is also considering purchasing an existing certificate from another carrier.
As Koulouris envisions it, US Global Airways will have lower costs and good service. The aspiration is not unique. So the bet is really on Stewart. Baltia had planned to fly JFK-Russia.
“I’m watching a C17 take off now,” Koulouris said Friday, as he looked out the window of his Stewart office. “Kennedy is oversaturated: Stewart is wide open.”
After Paris and Tel Aviv, potential US Global destinations include London, Barcelona, Nice, Naples, Athens, Warsaw, Budapest, Prague, and St. Petersburg, Russia.
The fleet would consist initially of three-class Boeing 767s, although Koulouris said the goal is to fly the more efficient Boeing 777. He said Kalitta “will bring on {767s} as we need them” but could also provide 777s.
In recent years, The Port of New York and New Jersey has managed to lure Stewart service by JetBlue to Fort Lauderdale and Atlanta; American Eagle to Philadelphia; Delta Connection to Detroit and Allegiant to Myrtle Beach and seasonally to St. Petersburg, Fla.
In June and July, Norwegian Air Shuttle will begin flights to four secondary European airports, using Boeing 737 MAX jets with 189 seats. That ought to provide an initial test for the airport.
“I’m a businessman,” Koulouris said. “I try to find things that don’t exist. I would not fly over the Atlantic with a narrowbody. I am not looking to pile people in.
“We want to create our own signature style,” he said. “Right now, the key is to become operational.”
https://www.forbes.com/sites/tedreed/2017/05/...4412ab7034
BLTA
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