i am still curious as to why, in this day and age of extortionat petroleum price increases, anyone would choose to start an airline. maybe that answer could be that they intend to offset the losses it will indubitably incur by tourism revenues. just consider some of the expenses, for starters: airbus 380 monthly rental; 702, 000usd. annual c-check maintenance routine: 7 million usd (conservatively) add salaries, landing fees, fuel, and all the ancilliary expenses, and one can understand why only an infinitesimal portion of airlines in the world are making a profit. maybe these guys know something mere mortals do not!

Dreadlocks: Because "Dominican Republic" is going forwards and any country that wants to
be a "developed country" must have a plain and simple service as a national airline.

Most likely They have private investors involved too, This is progress for my country and I'm sorry
if You don't like.

ouch

Rubirosa, why don't you point to me the passage in any textbook that says that to be considered a developing country, a country must have an airline? is it the same paragraph which advocates a METRO? i can see where this is headed.you are arguing emotionally, without any understanding of topics. if anyone disagrees, it is personal. maybe you should consider lending a little of your positive vision and optimism regarding airlines to the numerous air carriers who are in Chapter 11 bankruptcy proceedings in america. i took a look at the state of aviation in the caribbean and latin america, and the airlines are all flagging. maybe you could make a call to the principals at regional carrier, say air jamaica, which is 100 million dollars in debt. you can probably say" chin up. be positive. you are losing because people do not like you!!

the paper is so complicated with incentives from many companies and countries you would not believe it.....besides everybody has same costs....and whats wrong with competition unless your in Cuba

so what ....the Concord lost money on every flight it ever made....I have been in Caribbean long enough to see them come and go and stay so what is your point ..we should not have it....or possibly there is no need to lower prices with competition....good thing jet blue did not listen to you....Air jamaica ? dont start me up rasta man....textbook? those who do and those who teach

where is Texas billy when we need him?

i defer to your potent understanding of economics, Goulet. as an aside, jet blue is able to enter these markets precisely because of the failure of regional airlines. and Goulet, i assued posters that i would attempt to keep the discourse civil, but if you persist in being childish and rude, then i cannot guarantee withholding my rage at you. so, mountainannie, the gloves could be off: i do not suffer bullies gladly

dredy touchy touchy....please dont start insulting me again...I am very fragile

Dred: The reason anyone would start a viable business is profit. The Dominican market is one of the best in the airline industry. Some of the highest ticket prices,tariffs is one fat juicy market.Jet BLue sucess is also due in part to its hedging of fuel purchases.

GOULET, i do not mind your infantile attemps at humor, because all the readers know by now that you are demented. i would ask you , however, to stay away from any racial or religious namecalling. i am not amused by your 'RASTA MAN" apellation. i have enough good manners, civility and upbringing than to introduce race , religion and ethnicity into any of my posts. then again, my parents did a good job raising me with a worthwhile set of values and standards. as to JeffryB, i have no idea what you mean when you use the term 'VIABLE BUSINESS. if the airline business is so viable, answer for me the following
1) why is it that the economist A.M. Pilaski has written a book titled" why we cannot make money in avaiation"
2)why economist David Pauley describes avaiation as the "dumbest industry ever". for 58 years, us airlines have run up cumulative debts of 14 billion, the all time industry loser.
3)why in the last 20 years, many with 30 dollar per gallon petroleum prices, have

no less than 73 airlines failed in australia alone
4)why low ,competition driven prices is expected to work.there is already between 20-30% excess carrying capacity in avaiation. the only low fare carrier to survive the long run is southwest. jet blue is doing well now, but remember, it is still a relative upstart.

Why do people go to casinos? this combined with hard work and capital lead to win or lose economic situations.....or those 73 guys that started those airlines weren't as intelligent as you dredy...it is called capitalism and it is real dumb ...but there is nothing else around to replace it

forgive me if i fail to see the nexus between going to a casino and starting an airline. hard work and capital leads to win or lose economic situations: that is a tautology. however, the simple remaining question is: given the known quantities of recurrent failure, even in the best of circumstances, overcapacity, lease and maintenance costs, and escalating fuel prices, why would anyone consider it a good idea. and if you agree that it is, you can look up the e-mail addresses of David Pauly and AM Pilaski, and give them your intellectual take. i shall be glad to read excerpts, especially the ones dealing with the comparison between airlines and casinos. all the major players who have failed, such as Braniff, eastern, pan am, fronteir, midway, australian ,to name a few, had been given new life by massive injections of cash, but still they flopped. hey, maybe we just know something that they don't ( DIDN'T WE TRY THIS BEFORE?)

Dread: I probably cannot produce such text book quality arguments to substantiate mine, but let's assume that yes, indeed the aviation industry is or has been an economic pit hole; how much bigger a pit hole or how much larger would the implications have been had the aviation industry never existed or worse yet, cease to exist?

Can you imagine the concept of globalization without the ability to simply travel to another country and conduct business, sign trade agreements, sign peace treaties, conduct political agenda, etc..?

I must advise you that there indeed are countries you cannot get to in an acceptable period of time unless you fly there...

risk your investment for a big reward....................get it...To marxists this makes no sense I know

Biz, thank you for overrating my abilities. i agree with everything you say. of course we need civil avation. of course travel is compromised without it. my only premise is that this is not a good time for a startup venture, given the cost of petroleum, and the general world economic turmoil. 40 years ago, maybe, but today,no. we have more than enough carriers in the skies to adequately address our needs. we do not need to be saddled with such a risky venture at this juncture in history. as an aside, can you tell me of some of these countries which are accessible only by air?

i see where you edited your post to include the concept of reasonble period of time. as such ,i withdraw my question about countries onl accessible by air.

People immigrated mostly to New York in the 19th century because that's where the main port was located... It was no accident that New York became a great city...

So if DR wants more tourist... It needs a port and the ships to take them there... and in our present time... That means an AIRLINE...

ANOTHER GREAT STEP FORWARD

Carlos, we already have airlines that come here. we do not need an airline of our own. i am arguing it from an economic standpoint, some from the standpoint of bragging rights. i have exhausted my input on this subject. if you think that a startup airline is a good idea in today's world economic environment, when others are scrambling to get out of the airline business, knock yourself out! it would be nice to have a Starbucks in Nagua too, because we could call it progress.! think that is going to happen soon? why not?

A failed nation needs an airline. One good thing, the planes were not made here.

bragging rights I dont think so.....air jamaica is in the weeds because of poor mgmt and shrinking tourism..that does not have to be the case with AIR DOMINICANA a famous name in caribbean aviation....and probably a pretty cagey investment....look up who the stockholders are dred and let us know who these lame brain stupid idiots who want to burn their money are....that would be a good place to start for you...who are these idiots who own 60 % of dreds white elephant

you select air jamaica as a failure, but what about all the other carriers that went bust? why did Braniff go under? ALM is 260 million in debt. by the way, for all those who might be oblivious to one thing, let me give you 3 words: CLASS ACTION LAWSUIT!! ponder, if you will, the consequences of an air dominicana airliner falling into the everglades with 140 college students going home from spring break. try to remember that some of the recent wrongful death lawsuits in the usa include the 20 million awarded to the wife of one of the victims of the crash of the plane owned by Hendrick Motorsports. also, the 26 million to the survivors of a cessna which crashed in New England. every time a new airline starts up, these trial lawyers salivate. who in his right mind wants to expose himself to one of these episodes?

Goulet, you should check your 'FACTS ' before you commit your opinions to print. i just read in an article on the internet that the island of jamaica broke the 3 million visitor threshold in 2006, and the trajectory for arrivals is upward. that does not seem to jive with your post that air jamaica failed because of DECLINING TOURISM. care to have another shot?

Recent posted article that is somewhat relevant to what is being discussed here..
http://money.aol.com/news/article....nger-service/20080330211709990001

Dreadlocks: You need to read more economics, business and statistics #s before posting your biased, non sense comments.

Why AA is so profitable on all routes to Dominican Republic, you name (Santiago, Santo Domingo, Samana, Punta Cana and Puerto Plata).

Now You going to tell me that AA is losing revenue on these Dominican markets "Mr know
everything.

AA used to have a monopoly many years ago and didn't want to allow anybody else to fly
to Dominican Republic.

Your sensitivity and bad karma business is coming from the fact that maybe You don't see this
type of investment on the other side of the "hmm" ???

what, Mr KNOWNOTHING, does american airlines have to do with anything? are you going to equate american airlines with a startup ? it is precisely because i understand economics why i do not consider it a wise investment. do you have any concept of the assets which american airlines has to fall back on if they are going through lean times? do you understand the extent to which they can receive bridge financing? you cannot equate the losses of Burger King with a pica pollo. you cannot equate the operating costs of american airlines with a local carrier. the reason for this is economies of scale. their per-plane expenditure is less than ours, because their fleet is larger. they can charge lower fares than us and make a profit or break even. before you start trying to be unnecessarily rude, do some reading first. you might not agree with what i say, but suggesting i go read economics textbooks does not help the discourse. i would venture a guess that i know more about the subject than you!

further, Rubirosa, the loss of revenue of one grounded plane for a few days can blow the whole quarterly balance sheet right out the water, if you only are operating with 3 or 4 aircraft. american has so many aircraft it can press into heavy volume corridors that the effects are not the same. if a problem is found in a make and batch of aircraft, for instance an md80, once that thing hits US airspace the FAA can ground it till the problem is fixed! this is not like buying a motoconcho: the considerations are gigantic. if it was so easy, they wouldn't all be falling like flies!! what do you think? the guys here are smarter than the guys who ran Braniff?

This airline will be heavily subsidized, "Drug Transportation", but someone forgot the US$50,000 fine at the other end. !!!

perception, try to keep the discourse civil. making remarks such as those does not promote harmony on this forum.

Dreadlocks: at least They deserve the benefit of the doubt since They haven't even start flying yet, airline business is a "Tough" business.

I'm being in the business for 15 years so is a "up and down" curve , my point is that Dominican Republic is moving forwards and We need to credit the goverment.

KLM (dutch), Iberia (spain), Icelandair (Iceland), etc, etc.

Don't see the big picture why You have negative opinions, this is a normal and regular business like any other business so We need to sit, wait and see the results later on, jumping to conclusion is not productive or creative.

this is not a regular business, like any other business, as you call it. if you believe it is , then go right ahead. one of the most critical aspects of opening up a business is TIMING. if you live in a tourist destination, in the DR, you do not open up a restaurant or bar in the off season. nobody says that you should not open one: you have to know when to do it. also , if 100 other guys have opened in the same location and failed, maybe that should tell you something. i watch places here change hands every three months, then some other guy opens under a different name. you invoke the name american airlines to indicate that we can do it too. they have 750 aircraft, assets of 69 billion dollars, and decades in the business. not because they can survive means we can. it does not take much of a setback to cripple a small airline!!

"According to some sources, foreign investors own 47 percent of the new carrier’s shares, the State has 30 percent, and local investors 23 percent."

This airline is only buying 2 planes it is a test if they can pull a profit even $100.00 a route then investors will be happy if they lose they file for bankruptcy leave their passngers stranded and get out.

I give them 6 months tops

Jander: Do You believe that this equation that you post it: 47% foreign investors and 23% local investors are willing to commit a business suicide venture???

Good grief people, get a life...

Jander: Do You believe that this equation that you post it: 47% foreign investors and 23% local investors are willing to commit a business suicide venture???

Well in therory they cannot make a profit at least not in the short term.

It's not about profit at least not right away, it is about value and market share.

If they can get enough advanced bookigs to pay the bills they can stay afloat for a while.

It is also an offshore investment and a tax shelter for foreign investors.

I wish them all the luck in the world and don't and I hope they have a management team that can top Spirit and Jetblue , Southwest and the other " no frills" airlines.

Just have to wait and see.

dred ...jamaica is a dirty little secret aside from Sandals which is well run ..... Jamaica as a destination of quality up market tourism is circling the drain.....you understand they are fighting it out for the the all inclusives ....It has become like St Croix we dont go there anymore ...just go to a travel convention and ask dred ...the last prestige sailing event was moved to the DRm out of jamaica for this reason...they are competing with the cubans for the bottom of the barrel

http://www.dominicantoday.com/dr/....ailboat-racing-to-begin-next-year dred you dont give up pretige events like this you lose them

Jander: bottom line is We have to wait for the "Timing" and stop being negative since the beginning since this is not a real "Entrepeneur" and "Business focus" positive mentality.

Donald Trump already made US$350 million dollars in Cap Cana so if He would it think and follow people like you He wouldn't be in the "Win-Win" position that He is holding and standing now.

Dominican Republic is moving forward and looking to the best to come, to me this means a lot

Jander: bottom line is We have to wait for the "Timing" and stop being negative since the beginning since this is not a real "Entrepeneur" and "Business focus" positive mentality.

Donald Trump already made US$350 million dollars in Cap Cana so if He would it think and follow people like you He wouldn't be in the "Win-Win" position that He is holding and standing now.

Dominican Republic is moving forward and looking to the best to come, to me this means a lot

I used to rent my apartments to Aeromar.s flight crew , so excuse me if I am skeptical.

They lasted about 6 months

The airline was established in 1998 to replace the defunct Dominicana de Aviación. Service began with a single Boeing 727 leased from Falcon Air, for routes to Miami and San Juan. In 2001, it bought a Boeing 747 to a new route to Madrid, but the route was suspended 5 months later due to heavy competition with Iberia. In 2002, new services to New York, In 2003 The Airlines began to fly to Aruba, Havana and Caracas with Boeing 737, Boeing 757 and Boeing 767. In 2003, the airline ceased operations. Aeromar leased its fleet of Boeing 757 from Icelandair and Boeing 767 from Air Atlanta. Aeromar was the first airline to fly New York- Santiago, DR route in 2002.

Lets hope for the best and somehow someway lower the price to fly.

The dam taxes end costing more then the ticket.

Jander: Aeromar had a very "poor" management and I met part of the staff and saw almost daily basis operations at Terminal 1, JFK airport.

They didn't meet creditors expectactions paying debts to suppliers and Port Authority in a timely fashion.

I will give the benefit of the doubt to the new "Air Dominicana" and once again will be positive with this new business venture in Dominican Republic.

hey , JANDER, can you imagine how long they would have lasted in today's petroleum price environment, trying to compete with Jet blue? Rubirosa thinks that questioning a judgement is being anti-dominican. if they attempted this in any country, i would express the same sentiments.airlines are not fun things to run. they were falling dead when jet fuel was 63 cents per gallon. now it is 5 times more expensive. what are you guys thinking.? besides, post 9/11, do you have any idea how insurance costs have escalated? and Rubirosa, i asked you what do you think will happen if you lose a planeload of passengers? have they any idea of the kind of lawsuit that would eventuate? get real, and listen to Jander on this one. it is patently obvious that he knows a heck of a lot about this subject. if he felt it could work, why would he not say so? do you think he has a hidden agenda to sabotage the company, and ,if so, to what end?

dred this is a small airline startup,..... around the world there has probably been 10 others this month ....there are big rewards if you hit it,just like a casino....and those fly guys cant get it out of their blood

casino is the word. personally, i would take the money to Foxwoods or atlantic city. at least there you could get lucky. but in the airline environment, FUEL PRICES are not coming down anytime soon! i personally would get a statistician to calculate the odds between the casino and the airline before spending the money

everybody pays the same for the fuel....as everyone knows its labor that is the big variable in airline business

Dear Mr Dredlocks
Just a couple of observations. When you call yourself Dreadlocks expect to hear Rasta man or call yourself something else.
Best time to buy real estate in the US is in about 1-1.5 years when there is a lot of blood in the streets. Same thing would go for airlines. This is nothing more than common business sense and in a market that goes in cycles. It is just low in the cycle now but will cycle up again as it always does
What has 72 austrailian airlines gone south have to do with the price of eggs?

I have made a lot of money in real estate. One time when I was trying to tell a friend that it was a good investment he replied, "If it was such a good investment why doesn't everyone buy it". I wrote him off as a complete idiot for not even having imagination.

People are still flying and Jet blue makes money at high prices and they are even higher than American and Continental for the same routes.

When the US economy takes a crap so will the price of oil

a senior 747 pilot with Fed Ex makes a quarter million a year......hes like a bus driver with bennies

Escott, what exactly do you mean when you say that the US economy will take a crap? do you think that a severe recession is on the horizon, or that it will bounce back real soon? if it goes into the tank, what do you see for the future of airline travel to recreational destinations?

second residences dred second residences not recreational destinations

for some, they are one and the same.

dred you will be happy to learn that at 5pm comrade Raul lifted the ban on tourist aparthied in cuba .....the days are numbered ...how do you say glasnost in cuban?

were i you, i would be a little more restrained in lavishing glee: look at russia today. trust me, when the next revolution hits russia, it will be irreversible!

it is interesting to note dred the russian people never had the concept of private property even under the tsar. They were ripe for marxism

personally, Gouletcolonial, i am not a dyed in the wool supporter of everything fidel did and stood for. i never understood why the little ice cream cart i used to buy from was owned by the state. there are situations which are just too extreme for my tastes. however, i do not subscribe to the idea of privatising water, either!!

dred do you remember an airline called Prinair? It was quite large ...I was on the very last flight also near the last flight of Antilles Airboats the worlds largest seaplane airline at one time....owned by the beauteous Maureen Ohara

and Charlie Blair the famous pilot

Goulet, do not disclose too many of these tidbits. we will be able to triangulate your real age!

I moved first to la isla encanta P.R. our soon to be 51st state in 1974 ....ok sherlock

dred I am sure you are a sincere person in your beliefs and you have gained my grudging respect .

i always told you to give us the benefit of your knowledge and leave the humor to seinfeld. Oh jeez: this is beginning to sound like a love fest.

Well, well well, seems like many have much to say about the airlines. I would like to add my two cents. Based on my schooling, Currency, Social class , entrepreneurialism, free markets literacy rates and......National airlines play a major role in the future of a nation. A national carrier is significant because it gives the perception of growth, stability and advancement. I also cannot remember the texts but do remember this in most of my college classes. It serves as a marketing and branding tool to the world. It signals the world and would-be foreign investors that the country is viable and has capacity. It exudes national pride and above all "confidence" in the stability of a nation and its ability to support bigger enterprises..........

above comment is from ladronazo:

.....And yes an airline can be profitable, very profitable if it is managed properly. As one stated here American Airlines makes money hand over fist on its routes to the DR. It does so not only on its passenger space, but its cargo space. Why is it that now you are limited to 50 lbs on the airlines. Why do your bags get bumped from the plane? Because this allows more space for precious cargo that pays premium rates. Cargo produces higher profit margins than passengers. Cuba in its dire economic state has Cubana Airlines why can't we.

This site software is buggy, on occasion it does not post names of users.

i agree with all you say about the imagery. what does it signal the to the world about a country's ability to support bigger enterprises if it goes belly -up in a year? or drowns in a sea of red ink? in this day and age , i hardly believe prospective investors care if the country has a national airline. that may be true of 40 years ago. the economic realities have mutated. there has been a paradigm shift away from showcase projects towards projects with a really good chance of success. most airlines fail.

You're very right, but as stated "if managed properly" Though I do not support any politician, I must admit that Fernandez has changed the Business environment in DR. The airport at Las America's and Santiago 10-15 years ago were disasters, and now they are very profitable enterprises. DR does not need to be AA or UA or Delta. It needs to serve only niche markets, NY, Miami, Panama, Venezuela, PR. There are more than five U.S. airlines Delta, American Jet Blue, Continental, Spirit Airlines flying into the DR not to mention Copa, ATA, Iberia Happag-LLoyd from Germany. A 45 minute flight from PR cost $300-500 minimum. From Miami 1.5 hours $400-700 depending on season, I have flown in Oct, Feb, May and middle of summer and have yet to fly on a flight that is empty. If Flights were not profitable AA would not be there. Delta which has always been conservative airlines purchased route rights to DR. Again this is a chance to learn from previous administrations and do it right.

I am sure back June of 2007 no one was thinking of 100+ for a barrel of oil.
They were to launch this month but still no website to book online.
This may be over already?
However the big difference is the Government has a minority share .
Well lets hope the foreign investors are patient and can sit on this until the economy turns.

Middle income Americans will be taking vacations closer to home, that is if they still have one.
It's not pretty out there and now the UK's economy is looking to go the wrong direction.
It just doesn't add up and for that I think the timing is bad.

From Travel Weekly:
Air Dominicana, a new charter airline in the Dominican Republic, will launch 737-800 service to and from the East Coast of the U.S. from its hub in Punta Cana in April 2008. Future routes will include intra-Caribbean flights as well as service to Central America. A second 737 will be added in June 2008, and a 767-300 in October 2008. The Dominican government is a minority p

By having more airlines reaching DR, AA and others will have to lower their price, making tourism in DR all the more attrative.... simple economic equation.

I understand those who see it as dumb idea, but this gives the country independence and much more...

Gouletcolonial -
About Concorde, it did run at a profit. The French had financial trouble with theirs, however British Airways made profit. Concorde was about more than money though. It was about showing the UKs close relationship with the French, who have always had a Love/Hate relationship. It was also about showing the Americans who ruled the sky. To this day, the craft is still very advanced. How it stretches and changes shape in flight is amazing. Even now we still don't use Supersonic passenger airlines. In its 25 or so years it never had a fault. There was one bad accident, but that was due to debris on the runway, not the aircraft. It was capable of beating anything at the time and set many records, upon its maiden flight to NYC the Americans made such bad press of it. Using pollution as an excuse. Can you imagine that? Americans concerned about pollution. More angry about being upstaged.
Concorde is an aviation icon.

show me a link where it says the concorde made a penny english or french it does not exist...its safety record is no big deal based on the number in service and miles flown....it was a TURKEY in aviation....you cannot eat National pride....the US scrapped their SST because they saw the limitations...It never made a penny. the concorde yes an expensive icon

correction ..apparently it finally started turning a profit for BA but overall in was money in the toilet

This may be in poor taste for the very seious ones here but for the rest it is just too funny to not share.

http://www.gringo-times.com/artic....ir-dominicana-buys-new-airbus.php

Again not my opinion of the DR but If you live here you should chuckle

http://www.gringo-times.com/artic....uild-new-Dominican-motorcycle.php

The Concorde was a flying symbol and that is the motive it was flying for so long. Retirement was imminent and the only used the excuse of the accident to push the aircraft out of service. As already told here, the Concorde had an excellent reliability history, with only the fatal crash that occured in Paris, which was allegedly caused by debris left from the previouse aircraft takeoff. Before that, it was considered the safest operational commercial aircraft in history with zero deaths per traveled km.

The fact their is no similar replacement alternative now that the Concorde is out of service only indicates that although spectacular, it's not profitable in economical terms. At least not with the current technologies, and specially not with the fuel consumption the Concorde had while carrying only a mere 100 passengers.

Dominican Space Rocket Launch Set for April 30th
More Astronauts Required...

http://www.gringo-times.com/artic....dominican-space-rocket-launch.php

More articles from 2007-8
BMW To Build New Dominican Motorcycle

The Bush Interview

Santa Caught in Coke Scandal

United States Bans Coconuts

Disney to open in Puerto Plata

Paris Hilton Interview

Submarine Found in Dominican Bay

Trump Buys US$56 Billion Plot in Sosua

Air Dominicana Buys New Airbus

Kryptonite Found On Cabarete Beach

Dominican Police to use new Speedguns

Dominican Space Launch set for April 30th

some posters in this forum are so filled up with nationalistic pride that they invent the most ridiculous justifications for developments in the country. case in point; Carlos Franco asserting that competition from air dominicana will force american to lower prices. does he really believe that an airline with two or three aircraft is of any import to an airline with 750 planes? actually,Carlos, it is the other way around. if they want air dominicana out of the way, they can reduce their prices to a level that air dominicana cannot match and stay viable. it is like saying the opening of a pica pollo nextdoor to McDonalds will force them to lower their prices. people, please understand that airlines cannot offer willy nilly low price fares and stay operational in the world economic climate. even jet blue is no longer the bargain it used to be. reality triumphs over hope most of the time.

Mr Dreadlocks,
The economy of the US has been in the crapper for a while. That hasn't affected travel to the DR and won't in the future. It is a addiction plain and simple.

I expect the real estate problems, subprime/bubble to be over in 1-1.5 years. I will then go back and buy in either the Atlanta or Palm Beach Country Florida and hold for 2-5 years. Big money to be made when there is a lot of blood in the streets. Real Estate while a little different than Airlines runs in cycles and so do Airlines. Best time to get in is when the business cycles down and is going to cycle up again.

Hope I have made myself clear.

BTW haven't seen Belial here to bad mouth the US. Maybe the case of Rabies got the best of him! LOL

Escott, while i understand your reference to the business cycle, you cannot possibly equate real estate and airlines. real estate has no operating costs. once you buy the property, it can sit for centuries without maintenance. sure you will have to clear the brush if it is in a residential neighborhood, and protect it from squatters who seek to acquire it through laws of adverse possession. airlines, on the other hand, have to consider the costs of leases, the cost of fuel, cost of insurance, landing fees, c-check annual maintenance checkups at 8 million per plane, routine maintenance, and the unthinkable possibility of a flight going down. as to your contention that oil will fall in price: do not hold your breath on that. the USA is not the only country with a high demand for oil. 30 yrears ago, all you saw in the streets of beijing was bicycles and oxcarts. today we have traffic jams. Tata of India just bought Britain's largest auto maker. the demand shift is to the eastern

world. with vietnam and cambodia waiting in line to become the new powers, we are talikng a major shift in oil demand patterns. then we have to consider the former soviet republics ,which are themselves becoming consumer societies. no sir: the price of oil may fall, but very minimally.

Oh wow! Oh! ummh! Yeah! uh uh sooooooooooo What makes the DR gov. think that AA will simply let you guys have a successful airline oh yeah! since when have the AA body became so nice? So you think that AA will not do everything in their power to keep that plane on the ground? Come on we have already been checkmated a long time ago all we can do now is try to settle for a draw. If you want to know what will happen to Air Dominicana take a look at what happened to Air Haiti i think that;s what it was called anyway you get the point unless AA owns a cool 97% of Air Dominicana it will not fly and thats a fact.

Gouletcolonial -
Most of what I know about Concorde was from a tour I did. You can visit one at Manchester Airport in the UK. The tour was pretty impressive and covered all aspects, design, marketing, politics and business.

There is a little information here
http://www.concordesst.com/retire/faq_r.html
I'm sure Wiki goes into more detail.

It was profitable, but was becoming more and more difficult to run at a profit. Times changed.
It couldn't possibly be called a turkey though. The Americans gave up theirs because they were developing a dead goose. The same when they were trying to develop a plane with vertical take off capabilities, they kept screwing it up and had to get the British to finish the Harrier.

Even down on the ground Concorde still makes a profit, with people like myself going to visit it.
I remember being a kid and being told if you fired a rifle at it, the bullet wouldn't be able to catch it in flight. Amazing.

Some fanatics even get married on it!

Goulet, i see where you wrote the sentence" you cannot eat National Pride". could it be that we think more alike than we display in this forum.? this is exactly what i have been trying to explain to those who say that a national airline will lead to National Pride. what the heck does that mean ,anyway? heck, does anybody in their right minds believe that when people choose to do business in a foreign country they have a checklist of required qualities which include " ownership of national airline"?. do they think that if air india went into receivership ,software companies would look elsewhere for products??

I have video of the plane on its maiden flight from DR to Japan!!!
http://www.youtube.com/watch?v=B8ZOk7d4qS4

duane the SST that the US abandoned was dumped because they knew it could not turn a profit...france/england continued with concorde out of national pride it was a turkey....the harrier was bone throne to UK national interest as an ally.....do not rely on Wiki for your info particularly when you are researching controversial subjects like the turkey it is very unreliable......PS keep up the good work with Rolls Royce and Jaguar

dred you are correct about this issue " national pride cometh before the fall ".... however there are some different spins in this aviation equation ...........We as an island need as much lift meaning seats as we can get.....anything that takes price pressure off the seats to the DR is welcome.... If I am wrong I can hear your voice saying" I told you so "

the free market will dictate the outcome....if the crooks dont get em first

Goulet, i hope you are not wrong, because anything that benefits this country is joy to my ears.what is not a joy is $3.45 per gallon for jet fuel which sold for 65 cents less than 2 years ago!

All of you guys have good input into this forum
I am taking dreadlocks side and agree with all his stament in this forum. Specially with the cost of jet fuel at US$3.45 per gallon at present and to stay competitive with 4 planes against 750 AA.

Besides the cost to maintain these equipments and pay some one to maintain them for you are enormous since you don't have the technical know how or have to invest millions on equtpt & hangars that you don't have. A good example was Colombian AVIANCA had to be sold to Brazil due to the maintanance cost at the hangars.There is where all the big co get you.ex.Luftansa,air France & AA.

People can't compare realestate to airlines ,If that were the case why didn't Donal Trump invest in
it and would have gotten more than the 350 millions?. Forget about national pride,specially now days where we live in a global economy. Again i ask every one of you, if you were to invest in Dominicana de aviacion at the present, would you?Gvt 30% is a subsidy !

thank you, Mr Rancier, for introducing the issue of hangar costs: i forgot that one. if your plane breaks down at JFK, and is laid up a month for repairs, you do not get the hangar space for free. it is not like leaving your yamaha 100 at the local bike shop and having the repairman return it without charging storage. hangar fees are enormous, just one more massive expense in the airline equation.

Dreadlocks, you are a wealth of knowledge. Keep up the good work.

everybody pays the same AA does not get a discount .....AA does not have 750 planes in the DR serving only the DR.....AA pay scale will be far far higher than air dominicana subject to union approval .....Air Dominicana should target the weakest link in chain and there are many.....with local orientation this will be a competitive force and help keep AA honest in their pricing structure....the only thing I fear is fraud and mismanagement ....which are two things that do not exist in the DR [ouch]

thank you very much for your kind remarks, JOHNUSA. the cheque is in the mail.

dont cash that check it is written on Baninter

my, my, Goulet. aren't you up a little early? does this mean we both are serious about posting, or have nothing better to do?

actually, Goulet, when i make reference to the 750 planes, i use it to emphasise economies of scale. because of volume, there is a lower operating cost per unit. let us say you have one car in the family. you pay 1000usd to insure that car. if you have a fleet of 10, you do not pay 10,000. there is a progressive sliding scale which gives a discount to each successive addition to the policy. so, with ten cars, you might end up paying 7000, which effectively works out at 700 per unit. the same applies to all other ancilliaries: maintenance, food service, etc. also, if anyone can afford to cut fares and survive, they are the ones who can do it. that is why there are no Mom and Pop pharmacies left in the USA: big players, such as Rite Aid and CVS used economies of scale to run them off on a rail.

one other observation Goulet: i am sure you are aware of the risk/reward equation. even if airlines do not go into premature receivership, they do not make any worthwhile profits.the fly boys who really make money are those who use scruffy old planes to fly cargo for outfits such as DHL in jungle outbacks. passenger airlines have too much risk. the risk/reward ratio is stacked more toward risk.

no mom and pop drugstores but plenty small airlines....but do the Milton Friedman on the labor costs forget about any advantage AA has..... and thats the killer labor costs.....not fuel

DHL and Fed Ex and UPS are the biggest airlines in the world.....along with Executive Jet rental may actually be the biggest, their corporate name is Net Jet

Goulet, you know the travel business, so you should be more cautious when you express optimism.(just as i should be cautious with my pessimism). one of the issues with airlines is that they need superlative management personnel to stay alive. mediocre guys cannot run an airline. look at malaysia airlines: it was haemorraging money, until the new CEO rescued it with sheer brilliance. it is too much of a roll of the dice. i am sure that if you talk to some of the guys in the circles in which you move, every last one of them can tell you personal stories of failed startup airlines.

yesGoulet, and i guarantee you there is not enough tea in China to persuade DHL, FED EX or UPS to switch from cargo to passengers!!!

like I said the only thing I feared was fraud and mismanagement two things that do not exist in the DR.........ouch..........UPS...Fed Ex etc would love to be able to sell seats but their license does not permit....Imagine that price war on tickets

Fed Ex actually wanted to do joint cargo /pax government said no dice...you cannot play in that casino

precisely, Goulet. notice that they stayed with cargo instead of switching to passengers?

they had no choice ...government said no.....can you imagine selling stand by space on joint cargo/pax aircraft

that is not what i mean, Goulet. i was stating that they had a choice of passengers or freight, and chose freight over passengers.

very interesting thread...dread, are there any books on economics that you would recommend to someone who wishes to expand their knowledge on the subject?

dreds books all came from Moscow and are a little out of date........................................................................sorry I could not help myself,with that cheapshot

yes dred they were already in freight and wanted to do both with the same planes slightly adapted and yes they stayed in freight

wow 106 comments...it's a new record!!!
By the way check out the video of Air Dominicana's maiden flight!!
http://www.youtube.com/watch?v=B8ZOk7d4qS4

LOLOL...that was great Edward..

you guys who are doomsayers will all be sorry ....As I said once before Air Dominicana was once a famous name in Caribbean aviation.....and now the phoenix flies again....good luck to them

a famous name, Goulet? by what criteria do you adjudge it to have been famous, or is this yet another tongue in cheek remark? and cibaeno, thank you for asking about economics textbooks.i have no idea what your formal training in economics is, and am scared to recommend a particular text. my advice is to google Economics Textbooks and select from the bibliography. or ask Frank the Tank what the current texts are. i studied this stuff a long time ago, and thinking on the subject is very diversified. for example, classical economics is based on the presumption that consumers act rationally. new schools of economics are debunking some of the old thinking, based on the contention that consumers, in the main, do not act rationally, and many times in a manner contrary to their interests. that contention is borne out in part by my usual post, that the poorest segment of our society owns the most expensive cellphones!!

Mr. Cibaeño, I would recommend the writings of Robert Barro, as he is truly a genius.

Frank, does he have a central piece of work, or is he more into writing articles? hows the weather? sub zero? sorry, i could not resist that , since i am so jealous of you up there at LSE. who the heck do you think you are? what, no invitation to join you? and you call yourself my friend? stay well, Frank.

hey again Frank: have you read Small is Beautiful, by EF SCHUMACHER? it is subtitled Economics as if people mattered. i have been made to understand it is a masterpiece. Cibaeno, get yourself a copy. mine has been ordered by the bookstore.

sorry to bother you Frank, but i wanted to ask your opinion of the Secularization Hypothesis, which states that as a society grows richer, it becomes less religious (except in the case of the USA). could it be that very poor societies are very religious because the political , economic and religious overlords fed them a steady diet of religion to give them hope and keep them tranquilised?

Mike, the minds that authored said work are above reproach, let alone my youthful banter, and the numbers are certainly hard to argue with; but I do, differ in opinion, I think they have failed to factor in, a key variable. That is the aging population in industrialized nations(mostly Europe, as u stated the US has for the most part has escaped this phenomenon), and the waves of legal immigrants(and illegal’s)from LDC(Less Developed Countries)which are needed to power these economies. These individuals tend to be incredibility religious in nature and some of their offspring border on loony (in religious fever) ,and this is the coming face of Europe. The funny thing ; it’s is precisely Economic incentives that have led to a religious renaissance in Europe (and the drop in population growth among “traditional” Europeans), because as countries become wealthier, the opportunity cost of peoples time rises.

Children take time to nurture, and because of that people choose to have fewer of them. Some countries(France) are using financial incentives to increase their fertility rate as an attempt to stop the current trends( too bad I cant put up a graph(as a model) instead writing so much, as it is not one of my strengths).

As for the less developed nations, the situations tend to be way too complicated, for me to even begin to explicate my thoughts on the subject at this time(because I would be posting non-stop for a few hours). This is conversationis better left for one my trips to the DR with a cold Presidente in hand.
Ps. I have not read the book u mentioned above, I will look into getting a copy.

maybe when you come to the DR next time, we can arrange to meet and flesh out some of these subjects. i hardly think one cold presidente will be sufficient: more like one case! try reading schumacher: one of his interesting hypotheses is that because of economies of scale, there is an unnecessary crisscrossing of the same product. let us say there is a bakery in liverpool, and one in london. in order to maximise economies of scale, they both produce large amounts of bread. the local market cannot absorb all the goods, so the guys in liverpool end up selling to the guys in london, and vice versa. their delivery trucks, loaded with the same product, pass each other in the opposite direction. simple, but true and interesting

as an aside, guys and dolls, another one bites the dust. ATA airlines ,just today , filed for chapter 11 protection: in other words, it is going bankrupt. it had 30 aircraft, 2300 employees, and flew mainly to vacation destinations such as las vegas and hawaii. it also flew military charters, but lost that contract. i tell you, fellas, this is a tough road to hoe!!!

Correction! I have read some SCHUMACHER,(one call, and the DAMD British and their large libraries lol) As I understand it the books are organized into a group of essays, I have read many(of his works) but not organized in such efficient manner, so I hear.

P.S my work has me in air to Miami, sometimes 4 times a week, I haven’t gotten use to the cold (lol)

not if they got that military contract ATA lost.....then Air Dominicana hits jackpot

air Italia is a bigger bust.....air france withdrew their bid yesterday to take it over

http://money.aol.com/news/article....l-operations/20080403062609990001

and yet another recent article the lends some weight to dreads arguments on here..

Goulet, i do not express negative opinions solely for the purpose of alarming people or being a naysayer. i have always advocated small assembly ( you started the wheelbarrow thing, not me, remember?) airlines are hell. the fuel prices make them virtually unsustainable, whether they are big or small.

hey Frank, hope you got a few stopovers for spring break in miami!! that will make you forget subzero in London! yes, Schumacher is more of an essayist and opinion spinner, rather than a theorist such as Barro.

Frank, while you are at it, read up some stuff by Steven Levitt, one of the new breed of brilliant rogue economists. i am sure you already have, but, just in case...

BTW thank you for the info Frank and dread...I will look into this Barro's work..