Following a dearth of activity in the late 1990s, the US start-up scene is off to a flying start in the new millennium. The latest entrant is Tampa, Florida-based Crystal Airways, which intends to launch a low-fare, all-business-class service in the first quarter of this year.

Availability of capital, it seems, is not a problem. Crystal says it has raised $160 million, surpassing the $130 million raised by New York-based JetBlue, which plans a launch early this year. It remains to be seen, however, whether impressive fund-raising will be sufficient to keep these airlines afloat.

While analysts are impressed with JetBlue's business plan and its experienced management team, some question how easy it will be to operate a low-cost airline from New York's Kennedy Airport. "We've looked at the figures and we could not make them work," says one Southwest Airlines manager.

Crystal intends a non-stop, coast-to-coast, all-business operation, beginning with flights between Baltimore Washington Airport on the East Coast and San Diego or San Jose in the West. Such long-distance services by other entrants have historically been doomed to failure.

Source: Airline Business