Boom Supersonic, a startup supersonic aircraft manufacturer, burst onto the scene in 2014 and
has continued to gain more and more recognition as time passes. Boom’s activities are centered
around the construction of the Overture, a 65-88 seat passenger airliner. Picking up where the
Concorde left off, the firm has championed itself as the leader in future supersonic transport.
Let’s look at the business model of operating a supersonic passenger aircraft in today’s video…
In June 2021, the manufacturer made headlines when United Airlines announced a commitment
to purchase 15 units of the Overture. A little over a year later, in August 2022, Boom again
made waves when American Airlines placed an order for 20 examples of the same airframe.
With two major US airlines committed to adding the Overture to their fleet,
the aircraft will more than likely enter the skies before the end of the current
decade if it can pass all regulatory hurdles and demonstrate safe and reliable operation.
But we have to ask ourselves: What has Boom done to mitigate the most
common profitability issues in supersonic flying? In other words, how will airlines
completely fill their Overtures in order to turn a considerable profit?
Boom has been very clear that the aircraft will be targeted at business travelers,
and all the company's mockup images demonstrate a premium
product in line with the nicest domestic first class offerings.
On the surface, this makes quite a lot of sense: business travelers pay the
highest prices for their tickets and would be most concerned about time.
However, this business model does pose a few unique challenges that Boom's operators
will have to overcome. Let's examine a fairly straightforward case study.
Say a New York-based consultant needs to be in London from Tuesday to Friday to visit a client.
Currently, the consultant would likely take a flight such as British Airways Flight 176,
departing from New York-JFK at 7:35 PM and arrive at London Heathrow shortly after 7 AM.
With modern business class offerings featuring a lie-flat bed, this flight wouldn't damage
the employee's productivity. They could receive nearly a full night's sleep on
the 7.5-hour transatlantic flight, waking up in the morning of their destination.
When returning from London, the consultant might take British Airways Flight 179,
which would leave London at 6 PM and arrive in New York shortly after 9 PM.
By taking this conventional, subsonic itinerary,
the consultant is able to spend the entire day working at their Manhattan office on Monday,
get a complete rest on the plane that night, and productively work in London all of Tuesday,
Wednesday, Thursday, and Friday before flying home Friday evening just in time for the weekend.
Let's now imagine Boom's 3.5-hour transatlantic supersonic flights.
Now, if our consultant were to fly to London on Monday evening, they would either have
to depart much further into the evening or arrive significantly earlier in the morning.
In either scenario, the traveler will be unable to achieve a whole night's sleep,
if any at all, on this supersonic transatlantic journey. Particularly in Boom's recliner seats..
This will likely have a significant effect on our individual’s Tuesday
productivity - which could cause diminished performance throughout the rest of the week.
When returning from London on Friday, the traveler will be able to arrive
back in New York significantly earlier than they would on a subsonic service. However,
this is not of major concern to the passenger's employer,
as a few extra hours off on a Friday night shouldn't be an issue.
Daytime flights would not work for Boom for the same reason conventional transatlantic
flights do not meet the needs of business travelers. Even if our consultant did work
during the duration of his flight from New York to London, he would only complete 3.5
hours worth of work while his employer would be paying for 8.5 due to the time difference.
With these two options compared side-by-side, it becomes clear that
most firms would prefer subsonic transport for their employees on such a transatlantic route.
So, as you can see…Boom airline customers will need to address
the key issues that quicker journey times bring for business travelers,
who likely play a critical role in Overture's potential profitability.
While the logistics may prove more optimal for transpacific flights or other long-haul
over-water routes, the aircraft only has a range of 4,250 nautical miles,
preventing it from servicing even the most traditional Pacific routes
such as Los Angeles to Tokyo (a distance of 5,500 nautical miles).
Boom's website states affirmatively that there are quote "over 600 profitable
routes" that the Overture could serve. However, the more deeply one scrutinizes
the jet's target market and range, the more difficult it is to identify this potential.
Bizarrely, one of these quote unquotr "profitable routes" that Boom suggests connects Seoul,
South Korea, and San Francisco, California, two cities that lie nearly 4,900 nautical miles apart,
a distance beyond the range the company advertises for the jet.
At the end of the day, it is essential to remember that Concorde,
the aircraft that is our only reliable case study in supersonic aviation,
did actually manage to turn a profit for its operators.
Outside of crisis times, Concorde operators British Airways and Air France were able to
turn a consistent year-after-year profit flying the supersonic jet.
However, during much of Concorde's existence, subsonic jets did not usually have lie-flat
seats in business class. This made supersonic transport more appealing to the business traveler.
Perhaps precedent is not the right thing to look at here, as the world has so drastically
changed since the COVID-19 pandemic, with business travel specifically experiencing massive change.
High-net-worth individuals, however, may ultimately end up proving Boom's
saving grace. In a world where carbon footprints are increasingly
more important, private jets have increasingly come under scrutiny.
Governments could eventually place severe restrictions on private aviation in the future.
Thus, if the private option is removed, many of the wealthiest travelers could choose to
fly Boom's Overture. Indeed this would be a demographic that could help the supersonic
jet become profitable. Furthermore, a culture of elite travelers could give
the Overture an aura of prestige, further increasing ticket prices and load factors.
Regardless of Overture's future profitability, Boom's order book already demonstrates that
many believe they can succeed with supersonic travel by the late 2020s.
What do you think of Boom’s current situation?
How do you think airlines might schedule transatlantic services
to make them appealing to their passengers? Share your thoughts by leaving a comment below!
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