I think Aviation Week had a recent article on it, manufacturers are working on it but we shall see if they can be a better deal than what is currently on the market. I mean a 737-800 has a better fuel burn than an MD-82, but Allegiant bought MD-82s at $4M a pop. Saves a lot over a new 738. Engines are the same idea, you're going to have to tear people away from what they know works. If it happens, awesome, I miss props. I think someone should make a 100 seat Avantair.

Here is something interesting going on though, a modification to the MD80's thrust reverser that saves on fuel burn in a big way:
Dugan Kinetics

As to XOJET, I didn't know that. I guess the last I heard they were furlou... firing... some pilots but looking at the fractional thread I guess they're hiring.

My understanding is they're a block hour membership program but unlike Marquis that uses Netjets aircraft they buy their own. Block hour programs are great and you get a lot of cash up front. Its what I had at the first charter company I flew with, but, we ended up going out of business. It's too bad the people actually wanted to fly around in the aircraft they had prepaid for.

Membership programs are great in that you secure income which is hard to do. I looked at Marquis numbers one time and it, to me, was basically the charter hourly rate x 2. Now if XOJET claims they're 25% cheaper then they're the charter rate x 1.5. Tack on 15% fuel surcharge, if they're doing that too, and you've got the opportunity to make money, but not a license to print money.

What I'm getting at is the notion that airlines should be more like charter companies because charter companies charge thousands per hour, are cost + profit, and make money. But really, a vast majority, are nothing more than brokers who have a charter certificate and get sub prime aircraft owners to put the aircraft out for DOC x 2 - 15% commission.

Now I know x 2 looks good, but it isn't unless you fly a lot and you won't fly a lot unless its really less than x 2.... which means you have to fly more! The thing is the smaller the aircraft the more that margin is squeezed % wise because some small jets have lousy DOC's and the charter price on turboprops is about DOC + a fractional %.

If someone can figure out a way to shoehorn their cost so that they can compete at the below cost charter rates than that's amazing. It'd be even more amazing if they did it without prepaid membership programs, like airlines do. Again prepaid membership is about 2x charter rate and you can keep all that income IF you a) don't have to deadhead the plane and b) don't have to use a charter replacement and especially an "out-of-network" charter operation.

And for XOJET, I guess it also doesn't hurt to fly a direct replacement plane for Netjets (Citation X) and Flexjet (300). That'll get you a lot of income, if they're doing it that way. They love it when you offer something they offer, a 1:1 replacement jet for something in their fleet. I don't think the X and 300 were chosen solely on range performance and cabin size alone. BTW, the 300, sweet plane.

But getting back to airlines, an airline can't use many gimmicks and succeed. The best they can do is nickle and dime. They're not too unlike car dealerships. I used to work for one and I was shocked when I looked at invoices and they didn't make much money on a sale, it was only about $1500-$2000 a car- and I think that was before commissions. Thats not a whole heck of a lot unless you deal in volume. Airlines deal with volume and pennies per unit matter and while 50 seat aircraft have a niche, there numbers far exceed their value. You don't need as many of them as we have at todays prices.

If I were a regional pilot, I'd be so much happier if my airline was buying used Dash 8-300s or ATRs-500s. One of the first airlines to tout "WE HAVE AN ALL JET FLEET!", i.e. their fleet won't kill you, was Continental Airlines. And it didn't take long before B1900Ds showed up from Commutair after Coex parked theirs and then EMB120s from SKW in IAH after XJT parked theirs, Colgan 340s and today, I see Dash 8-400s and Dash 8-200s flying out of their precious hub in EWR. Airlines will take props.

Low utilization = buy cheap old jets, high utilization = buy new jets. Lear 35s are the way to go despite lacking in a big way behind newer aircraft but man are they cheap to buy.

Going back to the car dealership analogy above, guess where I did notice the bulk of the income coming from, cars under $10,000. Much higher margin than $30,000 cars. I think when you can get a plane with a healthy contribution margin then you can win.

Its all airlines are concerned about, RASM-CASM and not just CASM. The 50 seaters have an awful CASM, but if they fly ATL-ROA for $1300 then they have a fantastic contribution, better than an M88 would do. But put that 50 seater on ATL-DCA or ATL-LGA and you've lost a lot of money in a lot of ways.

The 50 seaters allow you access to a market and the opportunity to price gouge but if you have too many of them then that's not good and there is not only too many of them but the mainline carriers have signed contracts to keep too many of them and thats why mainline carriers want them parked. The sins of previous managers has come back to haunt the current managers.

Like I said, its better to dump 50 seaters and replace them with 70 seaters and turboprops. 50 seaters can be sold, chopped up or sunk for good coral reefs.