Low-cost carrier Avelo Airlines is planning to withdraw from the West Coast of the USA by year-end, a sweeping strategic change that signals significant financial difficulty for the start-up.
Houston-based Avelo, which launched operations from Hollywood Burbank airport in April 2021, tells FlightGlobal on 15 July that it plans to close its base there, reducing the operation to a single aircraft by 12 August and pulling out of the Southern California market entirely by 2 December.
”As all our planes that facilitate our West Coast operations are in [Burbank], the closure of the bases closes the entire West Coast,” Avelo says.
Avelo’s struggles underscore a low-cost model that has been under intense pressure in North America, thanks to a market oversaturated with affordable airline seats to popular vacation destinations and major network carriers offering low-cost products of their own.
Avelo’s website currently shows options to book flights out of Arcata/Eureka in Northern California, Bend/Redmond in Southern Oregon, Sonoma in the California Bay Area, Las Vegas, Los Angeles, Palm Springs, Pasco, Washington, Kalispell, Montana and Eugene, Medford and Salem in Oregon.
Last year, Avelo ceased operating between Redding and Southern California, citing the departure of its ground handling partner at Redding Regional airport, which serves a largely rural area in Northern California.
The carrier had established an operational and crew base at Charles Schulz Sonoma County airport in May 2024, following its struggles to establish a base in Las Vegas.
Avelo’s inability to maintain its presence on the West Coast is a troubling sign for the start-up, which had seemed to gain positive momentum coming out of the Covid-19 pandemic.
Cracks began to show earlier this year, however, as Avelo announced a controversial decision to launch chartered deportation flights for US Immigration and Customs Enforcement (ICE), citing softening demand for low-cost airline seats. At the time, the carrier said revenue from ICE flights would help stabilise its passenger operations.
Closing its base in Burbank ”was not an easy decision”, Avelo says.
”Our company’s deepest operational roots are in Burbank, having launched our first flight there over four years ago during the Covid pandemic,” it says. ”There is rarely one singular reason why decisions like this are made, and this one is no different. We believe the continuation service from Burbank in the current operating environment will not deliver adequate financial returns in a highly competitive backdrop.”
Avelo says that operational changes on the West Coast, along with ”investment of significant time, resources and efforts”, has not produced the hoped-for financial results.
“The aircraft in Burbank are expected to support growth in our East coast bases, where we have significantly more opportunity to continue our path to sustainable cash flow generation,” it says.
Avelo operates a fleet of 20 Boeing 737-700s and -800s.
Notably, the discounter recently extended its East Coast flight schedule through mid-February.
