Bullshot
Its the free speech element that makes this site useful. I don't think people are trying to pull an airlines down but they are making valid points and observations about the all-business class model
Silverjet has an almost identical business model to MaxJet but costs are probably higher because of 'product differentiators' like the dedicated lounges/terminals (call them what you like!) Its evident the model requires substantial amounts of cash to keep it alive long enough to generate critical mass.......and generating the mass merely increases cash burn. Take a close look.....SJ demand extra financing everytime they introduce a new [old] aircraft and two more are pending in MAR 08.
The Reubens aren't in this for fun - they are serious businessmen - and they are unlikely to behave like some infinite money pump; I think they are having a punt with SJ. The probable scenario is that they let it continue expending the cash generated in the last round of financing, hope it survives long enough for the brand to develop some real value (goodwill on the books) and then and then pick it off cheap (share price only going one way at the moment), take it private and leave Round 1 and 2 investors with nothing. If that doesn't happen then they have spent some pocket money and the business will go the same way as Maxjet (whatever that proves to be) and, no doubt, EOS will follow at some point. By the way, as a US corpration I believe MaxJet will have the benefit of Chapter 11 even though the last round of funding was raised in the UK; ironically, this gives them an advantage over UK airlines.
For the all business class model to work, they need to keep costs low. SJ and Max have appear to be spending fortunes on
PR (freebies for journos, award givers and 'influencers'?) and marketing (TV adverts, loads of internet advertising, magazines and airport and roadside hoardings etc.) to develop a brand in the vain hope of adding enough value to attract a buyer before cash exhaustion.
All Business Airlines offering low fares need to embrace the tricks employed by proper LoCo airlines such as Ryan and Easy. LoCo airlines do not differentiate; they drive down cost and maximise revenue - passengers expect less when they pay less. At the moment costs are increasing rapidly for airlines, mainly due to fuel, but the fares at the all business class airlines don't seem to be keeping pace with those increases - in fact they are now under pressure to reduce them from the legacy carriers (BA have an offer for £1200 Club World return to NY at the moment).
LoCo models rely on LF (equivalent to volume sales in discount supermarkets).......but LF is not the panacea to success in an airline so don't read too much into the monthly load figures. Anyone can sell £1 for 50p or in the case of the all business class model anyone call sell a £2000 seat for £999. If the product is as good at it is alleged by then it should warrant a premium or be capable of price matching, it should not require a heavy discount. Something has to - revenue or cost!
Maxjet and Silverjet are wholly comparable (EOS to a lesser degree because of their higher fares and top end target market) and therefore it does not bode well for SJ. Its a shame but the all business class model appears to be fundamentally flawed. I wish them all well..... but I fear for them.
That said, what is happening to MaxJet should be a wake up call for SJ and EOS and L' Avion in France - hopefully their management teams will act upon it before its too late!
The only advantage I see for SJ if Maxjet does cease operating is that it might generate some aircraft for expansion (assuming they can afford it) but it might mean accepting different engines.