Cerulean Airlines announces purchase of three MD-83 aircraft

Kansas City based Cerulean Airlines announced today that it has purchased three former Alaska Airlines MD-83 aircraft to enhance its mainline fleet. Cerulean, which markets itself as a “low-cost, luxury carrier”, already operates three of the McDonnell-Douglas jet aircraft out of its Kansas City International Airport (KMCI) hub.

The expansion of Cerulean’s fleet comes at a time when many other airlines are facing record losses. “We are holding our own right now”, Cerulean CEO Vince Novak stated. “Everyone in this industry is hurt by the rising cost of fuel, both its effects on our operating costs and the effects on the pocket books of our customers who may be forced into cutting back their travel plans due to their own budget constraints.”

Speaking on the financial health of the airline, Chief Operating Officer Leonard Jungck stated, “We have positioned ourselves with what we feel is a unique product in the air travel marketplace. We have retained the full-service in-flight meals and other amenities that many of our competitors have cut, and are still able to do so with fare rates that are amongst the most competitive in the industry.”

“The revenues of any airline are limited by the size of its franchise”, added Chief Financial Officer Tom Meierhoff. “We can either sit back and ride out the current market, or we can thoughtfully expand our footprint and continue to execute our business plan. The purchase of these aircraft clearly speaks to our intentions to grow our market presence.”

The aircraft in question were built by McDonnell-Douglas in the 1990’s before that company was purchased by the Boeing Commercial Airplane Company. Seating aboard Cerulean’s current MD-83 fleet is in a 16F-118Y configuration, while Alaska operated their aircraft in a12F-128Y configuration. Alaska has recently made the decision to remove the MD-83s from service as they have continued to focus on their 737 fleet. The aircraft are currently stored at Victorville, California.

“The aircraft will receive an overhaul/acceptance inspection at our contract facilities in San Antonio before entering service”, Jungck stated. It is expected the aircraft will be used to supplement Cerulean’s current network as well as to allow for a modest expansion of their schedule.
Industry analyst Scott Unrath of Steele, Smith and Reagan said that Cerulean’s move may be in response to their poor decision to purchase seven Boeing 737-500 aircraft earlier this year. “Cerulean bought seven former United Airlines 735s when they came off lease with S7 Siberian Airlines. From what we have seen they just don’t seem to be the right fit on several of Cerulean’s mainline routes.”

“The 737-500s have their place in our system and we are looking at making tactical changes to our aircraft assignments to maximize our revenue to available seat mile ratio”, Novak said.

In another aircraft fleet move Cerulean placed it’s two Bombardier Q400 Next Generation aircraft for sale. Cerulean officials have stated that this move is to reduce the number of aircraft types in their regional fleet. “It is their newest aircraft type, but right now it just doesn’t fit in their stable”, Unrath said. “With the money generated by their sale, I am sure Cerulean will be looking at other aircraft to supplement their mainline fleet.”

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