Global Airlines CEO Reveals JFK and LAX Flight Plans and Addresses Big Investor Concerns

Global Airlines’ Founder and CEO, James Asquith, has announced the airline’s bold strategy to launch direct flights from its home airport to New York JFK and Los Angeles International by the 2024 northern summer season. As part of this expansion initiative, Asquith aims to bolster the airline’s fleet with the addition of five A380-800 aircraft. This move comes as the airline seeks to establish a strong presence in the transatlantic market.

During a recent event held in London, CEO James Asquith shared that the forthcoming three-cabin quadjets will offer comfortable seating for approximately 450 to 470 passengers. Additionally, the airline is actively working towards obtaining an air operator’s certificate (AOC) later this year. Asquith emphasized the airline’s commitment to enhancing the travel experience for business travelers and revealed plans to attract them through the incorporation of redesigned and refurbished cabins.

Recent reports from ch-aviation have shed light on Global Airlines’ fleet development. The first four A380-800s have been identified, with the initial aircraft recognized as 9H-MIP (msn 6). This aircraft, formerly operated by Hi Fly Malta, now features Global Airlines’ livery and is currently in storage at Lourdes/Tarbes. The startup has also confirmed the acquisition of three additional A380s. However, details regarding the source and specific identities of these aircraft remain undisclosed. The announcement of a fifth aircraft further underscores the airline’s ambitions for growth.

Despite Global Airlines’ promising plans, questions have arisen regarding the accuracy of the startup’s 2021 investor pitch deck. During the London event, Asquith addressed inquiries about the airline’s operational and financial credibility, refuting claims that the business plan lacks viability, considering the history of failed carriers in the transatlantic market. Additionally, concerns highlighted by the PaxEx portal have drawn attention to discrepancies within the 2021 investor pitch deck. These concerns include misleading statements about securing an AOC and questionable financial assessments.

Of note, the pitch deck outlines a remarkable business proposition wherein each A380-800 would be acquired and retrofitted at a cost of only USD 8 million, well below industry standards. After conversion, these aircraft are projected to be revalued at USD 60 million each, as indicated in the projected balance sheet figures. However, as the fleet grows to an envisioned total of ninety A380-800s, the individual quadjet valuation diminishes to USD 15 million. Notably, the pitch deck fails to provide explanations for these valuations and their variations. Additionally, the deck mentions a potentially dubious USD 50 million loan secured against three aircraft. This claim is questionable given the startup’s recent commencement of aircraft acquisitions.

Further insights from the pitch deck unveil anticipated revenues from a fully operational A380-800 flying the London Gatwick to Orlando International route. The projections suggest an impressive USD 381,000 profit from an income of USD 903,700. The calculations are based on the sale of different seating categories, including economy, premium economy, business, and first class, along with revenue from freight transportation. According to the 2021 cost estimates, the pitch deck predicts USD 27,000 as hourly operating costs for the A380-800. Depending on passenger loads of either 85% or 70%, the projected profits for the sample sector stand at USD 246,000 and USD 111,000, respectively.

Moreover, the pitch deck outlines ambitious revenue goals of USD 7.6 billion by 2025, projecting the operation of seventy-five A380-800 aircraft. The deck hints at the intention to capitalize on substantial and discounted aircraft orders to achieve these financial milestones.

However, this projection seems to be very unrealistic and questionable, based on several factors:

• The A380 is a very large and expensive aircraft to operate.
• The post-pandemic era where demand for air travel is expected to remain low for a long time.
• Global Airlines claims to acquire A380s for very low prices and retrofit them with new cabins.
• It does not explain how it will finance these costs.
• It does not explain how it will achieve such high load factors and yields on its routes.

Significantly, developments since 2021 have led to changes within the airline’s offerings. Notably, certain cabin classes, including the “gamer class,” have been eliminated. Liam McKay, recently appointed as the Director of Corporate Affairs at Global Airlines, explained that these changes reflect the evolving landscape since 2021.

The pitch deck also contains many inconsistencies and errors in its financial projections and assumptions. For example, the company predicts $7.6 billion in revenue for 2025 in one slide, operating 75 A380s. Another slide shows the same number of planes with revenue of just $5.4 billion.

Global Airlines’ CEO James Asquith’s announcement of expansion plans and fleet growth, combined with addressing concerns surrounding the investor pitch deck, showcases the airline’s determination to carve a distinctive niche in the competitive aviation industry. As the airline navigates these ambitious aspirations, its ability to adapt to changing circumstances and refine its strategies will undoubtedly play a pivotal role in its future success.