New Airlines generally face risks during startup phase.
It is therefore necessary to set the airline on a sound financial basis for a stable run-up and for at least 2 years of operation.
Apart from that, generally the main risks imposed by airline operations are:
- Increase of fuel prices. All Airlines face that challenge and need to increase their fares parallel
- Initially low load factors – basically a result of insufficient and effective marketing
- Political factors – Being obstructed by political interests is improbable since we operate outside of the standard envelope of competing airlines. We are therefore no direct competition
- Local Protests against Tourism
Currently, protests against an increase in tourism in the Canary Islands are in effect not directed against tourism itself, one of the major sources of income for the islands, but are a direct result of the people of the Canary Islands not adequately participating in tourism.
That needs to change and the local authorities have begun to counteract the above tendency. CanAm will support that path by training and employing young locals at decent salaries – to make them part of the CanAm-family - Crews
For B747-400 operations there is a pool of crews available due to the fact that many of these aircraft have already been retired. Therefore many seasoned crew members are expected to embrace the possibility to “live there where others go on vacation – on the sunny side of life”. Therefore we expect recruiting crews not to pose any difficulty; -still presupposing HR professionalism from the start. - Competition arising–
Theoretically, another Spanish or US airline could also serve the US- connections to and from LPA. This is a very real threat, but the sheer size of the catchment areas has enough potential for many years to come. At the same time, securing the bases TFS and LPA for own operations will give CanAm an advantage over airlines operating from remote hubs, such as Madrid, since it will always be a connecting flight for them - Reputation
The first mover with a high reputation (see above: Lufthansa Technik being a launching partner) has the best options for success. Especially when on-board Service, Amenities and Sales Portfolio stand out from today’s sad crowd, the new airline will become trendy and popular - Pandemics
The ineffable “Covid19 -pandemic” has clearly manifested an hyperreaction of politics over medical indications and has taught the international communities to be question the motives. After the lessons learned it is highly unlikely this overreaction will happen again - Loss of Reputation
Highly professional service partners and crews will ensure an overall safe airline operation. For one, many 747 crews are set free on the market with the number of aircraft diminishing. Also, the beautiful location of the home base Gran Canaria is definitely an incentive for aging crews to opt for the new airline giving CanAm a sound base of experienced professionals.
Here, last but not least, the Boeing 747-400 has the maturity to be one of the safest long-range aircraft in the world –also an important factor in view of the history of flaws of modern aircraft, such as the unfortunate Boeing 737MAX. In doubt, people will tend towards the safer, proven aircraft, especially when fitted with the redundancy of four engines with impeccable reliability record, such as the GE CF6-80C2B1, common to all Lufthansa aircraft of this type.