Australia’s new low-cost airline Bonza aims for mid-2022 launch

The ambitious startup plans to fly all-economy Boeing 737 MAX jets across a network of regional destinations.

By David Flynn, October 11 2021
Australia’s new low-cost airline Bonza aims for mid-2022 launch

  • Startup to be “Australia’s only independent low-cost airline”
  • Network will focus on regional leisure destinations
  • Bonza will fly Boeing 737 MAX 8 jets with all-economy seating

Starting an airline is a risky business decision at the best of times, and even more questionable while the world remains in the shadow of Covid-19.

But Australian startup Bonza intends to ride a post-pandemic wave and soar into the skies as the country’s only independent low-cost airline by the middle of 2022.

And they’re crowded skies – Bonza will not only be taking on Jetstar, and by extension its muscular parent Qantas, but it could also draw the ire and fire of both Rex and Virgin Australia.

However, Bonza founder and CEO Tim Jordan tells Executive Traveller the airline will focus on a network of regional leisure destinations rather that the east coast ‘triangle’ of Sydney, Melbourne and Brisbane, including point-to-point routes “where travel is now often limited to connections via major cities.”

It’s a different way of thinking about the Australian market, and one which could bring welcome competition to regional routes, including to cities and towns where business travellers must often choose the lowest fare of the day.

“When you look at the largest 15 domestic aviation markets in the world, Australia is the only one that has no independent low-cost operator,” says Jordan, a low-cost alumn whose career has included operational and management stings at Virgin Blue, Cebu Pacific and FlyArystan.

“We’ve seen an opportunity in the marketplace, and one which is very complementary to existing operators.”

Blue skies ahead for Bonza?

“As for why now? The light shines brighter every single day in terms of heading out of this revolting pandemic, and the opportunities in terms of executing Bonza with appropriate cost levels is now.”

Jordan plans to tap staff made redundant by domestic and international carriers, and woo airports and towns “who will hopefully see that we can develop brand new markets for them and allow the tourism industry and the aviation industry to recover a lot quicker than otherwise would be the case.”

It’s also the best time to be shopping for aircraft, Jordan believes, with Bonza’s deep-pocketed backers – Miami-based investment firm 777 Partners – “able to acquire aircraft at rates probably not previously seen, or at least not seen in a very long time.”

Bonza’s fledgling fleet will be a handful of new fuel-efficient Boeing 737 MAX 8 jets, fitted with economy seats from tip to tail.

So, about that name… Bonza was chosen for its Aussie resonance in signifying something which is simply yet unquestionably great. The Urban Dictionary goes as far as to assign it a meaning of “good and well executed”, a definition which Jordan fully embraces.

“That for me is exactly what we want to be. We want to be good, in fact we want to be great, and well executed. I'm a firm believer that whether you pay $10 or $1,000 (for an airfare) you deserve a great product.”

Low-cost champion

To Jordan, who is an unabashed champion of the LCC model, low-cost doesn’t mean – in fact should never mean – low quality.

“It upsets me when certain low-cost carriers don't deliver a quality product. You deserve on-time performance, and safety always goes without question.”

“So yeah, low-cost is my thing and there’s no hiding it,” he laughs candidly. “That's who I am and that's a natural extension of everything that I've been doing over the last 20 years.”

“I love the leisure traveller., and I love what we (low-cost carriers) do, taking people on holidays and to new places they haven't been, getting families back together more often… and that's exactly what we plan to do with Bonza.”

“Australia has some wonderful airlines that are very focused on the business traveller, and they execute wonderfully.”

“But we will be for all Australian travellers, whether it's for teachers, tradies, kids or carers – that's our market.”

And those travellers will pay only for their seat and a single carry-on bag – in keeping with the LCC religion of ancillary revenue, everything else will be come with an additional price tag.

“I'm a massive advocate of choice, and I don't believe in people subsidising the person sitting next to them,” Jordan elaborates.

“If someone wants to choose and buy something to eat in the airport, that's up to them – if someone wants to buy something on board from us, then that's absolutely fantastic as well.”

“We're about personal choice and people putting together their own product, which suits them and their family.”

And it should go without saying that Bonza won’t indulge in frequent flyer programs, airport lounges or anything that’s a distraction from the core mission of “having the lowest cost we possibly can for our operations, because those low costs will allow us to deliver the lowest fares.” 

Regional destinations with a leisure focus

Jordan doesn’t see Bonza as going toe-to-toe with Jetstar, or any other airline for that matter, “because our focus will absolutely be on routes which currently today are not operated by any incumbent airline.”

“This is about opening up new routes and new markets, so the majority of the routes that we serve will not be operated by existing carriers.”

While there will inevitably be some duplication with other airlines, Jordan believes that will pit them against “business-focused carriers that are offering high frequency and all of the necessary bells and whistles for business travellers. We will offer a low-cost alternative which will stimulate a new market.”

Bonza’s playbook will be about coupling its lower fares with fewer flights, given that leisure travellers have a more flexible timetable and want to spend at least several days at their getaway destination.

“We will be about offering a generally low-frequency service – maybe two or three times a week – at a very low price. That's our mode of operation.”

To build put that network, Jordan will this week begin approaching “about 45 airports across Australia” –  and saying, ‘Hey, would you like Bonza service to your airport?’”

“Clearly we've got some ideas of our own, but we want to hear the airports’ ideas, and based on that response, our network will take more of a firm shape.”

“A quarter of our costs are actually airport costs and that's just too much, especially when we're talking about trying to stimulate brand new markets for these airports and to support economies in a post-pandemic recovery situation.” 

Bonza won’t be Virgin Blue 2.0 (or Ryanair Australia) 

Despite his roots at Virgin Blue, Jordan says Bonza won’t set out to replicate the Branson-backed airline which let went full-service as Virgin Australia before settling into its latest mid-market hybrid incarnation.

“Virgin Blue was a fantastic place to be when Virgin Blue was Virgin Blue, but there’s no intention to recreate that in any shape or form.”

“I think what we will do is build our own Bonza brand and culture. Will there be similarities? Possibly, over time, but if people see any hint of that, it's an unintended consequence and maybe it's just part of the Australian culture which is coming through.”

Bonza will be a sibling of sorts to Canadian low-cost carrier Flair.
Bonza will be a sibling of sorts to Canadian low-cost carrier Flair.

Nor will Bonza be an Aussie take on Ryanair, perhaps the world’s most famous – or perhaps infamous – ultra-low cost carrier.

Jordan sees more similarities with North American’s Allegiant Airlines, Europe’s Jet2 and especially Flair, a Canadian ‘ultra low-cost carrier’ also backed by 777 Partners.

Like Bonza, Flair – whose slogan is ‘Plane and Simple’ – flies only Boeing 737s, and mostly the MAX 8, launched in 2017, all-economy class, promotes itself as “the pioneers of ultra-low fare travel in Canada” and “an airline for everyone.” 

Bonza will fly the Boeing 737 MAX 8

Those factory fresh Boeing 737 MAX 8 aircraft, leased through 777 Partners, will be another element of Bonza’s fresh approach – and it’ll make them Australia’s first airline to fly the 737 MAX, a full year ahead of Virgin’s planned mid-2023 delivery of the MAX 10.

The MAX 8s will arrive in an all-economy configuration that’s expected to be 186 seats – a dozen more than Qantas’ two-class Boeing 737-800s – although Jordan confirmed this isn’t the high-capacity ‘737-8200’ model which Boeing developed for low-cost carriers such as Ryanair.

And Jordan doesn’t believe that extensive media coverage of the MAX’s two fatal crashes and 20-month worldwide grounding could deter passengers from flying on the troubled aircraft.

“There are hundreds of MAXs flying around this world at this very minute. The aircraft is approved by Australia’s authorities for airlines currently operating into Australia and regulators around the world have certified that the aircraft is absolutely very safe to fly.”

By the time of Bonza’s launch in the second quarter of 2022, Jordan expects to have “only two or three” jets in the hangar, “but depending on how we execute and regulator permitting, we’d expect to grow quite quickly thereafter.”

But even with only three jets at launch, Jordan believes Bonza could offer a relatively large network due to the lower frequency of flights.

“I would see us having quite a broad route coverage on a low frequency basis. We will probably fly more routes (per aircraft) to more destinations than would normally be the case.”

Qantas - Qantas Frequent Flyer

18 May 2011

Total posts 232

I guess there was an embargo on reporting on this 4 year old business starting operations next year because news of it come up everywhere all at once.

I wish them all the best and hope they are successful because what the competition could mean for service and price in the Australian marking is exciting and I take heart from reading they want to be more like 'Allegiant' than 'Ryan Air'. I wish they'd be more like JetBlue with Mint.

However, I can't but help feel I'm seeing another lamb to the slaughter.

01 Jul 2021

Total posts 17

Oh dear the 737 MAX this won't end well also if Australia needs or wants another low cost airline bring back Virgin Blue

Virgin Australia - Velocity Rewards

08 May 2014

Total posts 49

I wish them all the best too, but won’t the 737MAX be too big for regional routes?

A220’s or E2’s may have been a better fit?

Delta Air Lines - SkyMiles

16 Oct 2017

Total posts 133

Reviews of Allegiant are 50/50 love them and hate them. Poor customer service, cramped seats and flight cancellations are the main criticisms.  Perhaps not the best carrier for Bonza to cite as a comparison. Also I wonder about so few aircraft and such infrequent service. It looks like a recipe for trouble when there is a cancellation for weather, tech etc. Even so, I wish them well and might give them a try.

Air New Zealand - Airpoints

21 Jan 2016

Total posts 202

I would say, Bonza will be more like Flair in Canada.

30 Aug 2013

Total posts 445

Well Bonza certainly is about the most Aussie name they could think of!

His comparison to Allegiant is interesting. They have a dreadful reputation in the US for flying very old aircraft they picked up for next to nothing that constantly break down and they skimp on maintenance to almost dangerous levels. Delays and cancellations are the norm, not the exception.

What I assume he means with the comparison is that Allegiant mostly only fly routes that no other carriers serve nonstop, and only fly them when there is sufficient demand. It might be weekly, only on Saturdays, from a random city you've never heard of to Las Vegas or Florida because enough people from that small city want to fly nonstop on Saturdays. The aircraft can sit idle the rest of the week because they were acquired so cheap.

In theory, for that model to be adopted in Australia we would suddenly see all sorts of routes that have never had direct service before. Devonport - Gold Coast, Avalon - Alice Springs, Newcastle - Broome, Sydney - Kangaroo Island, Albury - Mt Gambier. The reason this model works in the US is because they have well over 10 times the population of Australia and the planes were bought so cheap they don't need to fly very often to make money.

Buying/leasing new, expensive 737MAX aircraft need to fly multiple flights a day to justify their cost. I cannot see 200 passengers a week on any of those routes I've mentioned above, let alone 200 per day. If they could have bought A220s cheaply second hand that might be a good plane for this business. I could see Bonza quickly giving up on their 'underserved' market idea and just throwing their planes onto popular leisure routes like Melbourne - Gold Coast, flooding the market with cheap seats and trying to outlast their competition (like Tigerair tried to).

Ryanair has hundreds, if not thousands of routes across Europe. Their CEO Michael Leary once said 'people will pay to fly from somewhere to nowhere, and from nowhere to somewhere, but not nowhere to nowhere'.

03 May 2021

Total posts 30

Albury-mount gambier are you sure?

Can Albury handle a B738 without weight restriction ? A b733 can.

bmc
bmc

Virgin Australia - Velocity Rewards

22 Aug 2013

Total posts 172

If they can keep to an on time schedule then I'll fly then for family trips. 

Qantas - Qantas Frequent Flyer

01 May 2019

Total posts 35

Tar and feather me but 737 MAX's...? They are still having issues and fixes. This alone would cause me to fly with another carrier. 

30 Jul 2015

Total posts 131

I think the MAX might be too big of a plane for the market they are seeking to get into. Maybe the A220 or E190 might be a better fit. 

03 May 2021

Total posts 30

This airline is not going to survive, starting an airline is a very ambitious task

01 Oct 2020

Total posts 5

Not a good day to be a Rex shareholder. The competition is already strong and this just adds to it. Rex management really needs to be more innovative to gain and retain customers. However having Bonza come into the market is good news though for travelling Australians. 

Bonza won't be on golden triangle, but there are plenty of routes that could handle nonstop up to 3 or 4 times a week & no more. Guys at Wellcamp Toowoomba would welcome any airline flying jets to lots of ports nonstop, on a low frequency basis. If cheap, they could pull passengers from Ipswich & even western Brisbane. Those who have learnt to fly with less luggage can save. Could they fly trans-tasman perhaps ? Plenty of low frequency routes there would work.

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 676

I can see and understand the need to avoid having lounges as a passenger amenity, especially if you're flying to regional (small) airports on a once every second day or once a week basis. 

However, the idea of not offering a ''Frequent Flyer' program is - to me - curious. Look at the companies that wrote the (successful) LCC book - Southwest, JetBlue, GOL - and it is clear that each of these offer some form of incentive return for repeat travellers. They don't have lounges but they do have incentive programs. The difference being that these are generally not in the style of 'alliance' programs, and nor do they work on complicated status and mileage points. Often they're as simple as a 1 freebie for 10 flights. And Australians - like most people - absolutely love the idea of something that is (perceived as) free. One only needs to look at the penetration and sign-ups of the QFF and Virgin Velocity programs.

Also, if 'regional' is to be Bonza's focus, I agree that B737 sized frames are overkill. If Wagga Wagga to Sydney or Orange to Sydney currently support DHC's, it's gonna be one helluva battle to attract more than a handful of people on a route like Albury to Lorne (VIC) or even Port Lincoln to Ceduna on a thin schedule. Filling 186 seats? Perhaps not. 

Here is the reason that flexibility is the key. Within the Australian market, new (and even old) B737's are the domain of capital and major regional hubs, not unserved or even underserved small towns and communities. Just ask Rex, Virgin, Jetstar and Qantas. You could also find some further believers within the prior managements of Compass, Compass2, OzJet, and a myriad of others.

Final point that is also curious: no announcement of total available startup capital. That, in itself, seems a bit telling. Oh, and absolutely no mention of maintenance, or catering, or station staffing etc. You know, those things that small carriers need to outsource. Gee, I wonder about AOC details ?

03 May 2021

Total posts 30

I think when they say regional they don’t mean regional like connecting two towns under 50000 population, what’s likely is connecting bigger cities to smaller cities/tourist areas which don’t have as many flights.

01 Apr 2014

Total posts 100

Albury NSW to Lorne VIC? Good luck on that route Kimshep, you may be in a holding pattern over Lorne for a while....... while you wait for them to build an airport anywhere close.

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 676

.... which is exactly my point, born2fish LOL. You get a prize for being the only one to pick this up !

For those of you who have not looked at the 'bonza' website, you're in for a real treat. 

  • No information about fleet.
  • There is not a single destination or route listed on the very thin website. 
  • In fact, Bonza is asking it's website visitors to suggest where they think Bonza should fly. I've seen this sort of management approach be embraced before in the USA. All it does is generate a bit of short-term interest from hopefuls living in small, unserved communities. 
  • At least with my Lorne suggestion, it is a recognised, well attended and well-respected tourist destination (without a real airport) which is ~ 73 klm to Avalon or 123 klm to Tullamarine. This theoretically is the type of destination which would appeal to Tim Jordan, apparently. And no, I haven't suggested it ROTFLMAO.
  • There is no business case or justification for Bonza on the website. No information about the backers or any affiliated bodies.
  • The only 3 pages I could find were the Home page, a Careers page, and a FAQ page with 6-7 questions on it, none of which reveal anything about the carrier.
  • It's full of enthusiastic hype and little more. David's article contains more information on the carrier than their website does.
  • The final interesting part is that its headquarters will apparently not be based in a capital city. That is, in my opinion, a very odd choice.

18 Sep 2015

Total posts 101

On your last point - conversely I applaud companies that set up headquarters beyond the capital cities. There is far too much concentration in the major capital areas as it is.

12 Oct 2021

Total posts 1

I for one will certainly not be buying a ticket from these fellas. 777 Partners must have dough to burn.

They say they are not going to go head to head against Qantas, Jetstar, Virgin or Rex (who will no doubt be laughing at Bonza rather than cowering in fear...).  Bonza will not court the East Coast "Golden Triangle" which in normal times includes the worlds 

third highest density passenger routes (Melbourne to Sydney) in the world...which seems the first act of folly.

They are going to fly high density aircraft on low density routes. They are going to develop new routes between unproven regional centers with 186 to 200 seater Boeing 737 MAX.  I wonder how those regional centers will be equipped in terms of accommodation and visitor infrastructure?

My money is on Bonza not even getting off the shelf. But good luck to the entrepreneurs and I expect they will manage to extract as much coin out of the investors deep pockets while they can.  If they do take off then put me down for a cheap tradie fare from Coffs Harbor to Moree.

24 Dec 2013

Total posts 100

ET's audience of business and premium travellers aren't exactly Bonza's target market so I doubt anyone here will actually fly with them. I'm surprised it has even been covered on this site. Good to see some variety in content though.

sid
sid

07 Jan 2011

Total posts 46

The reason we have covered it is because they intend to fly certain routes where there may be the only or one of two carriers. Therefore, if you have to travel to these destinations Bonza could be a viable option.  

It's easy to forget that plenty of business goes on in "leisure" destinations, the least of which is catering to the tourists. 

09 Aug 2015

Total posts 92

Very good point Sid, my brother runs his business out of the NSW north coast, there are a lot of businesses around there, eg Port Macquarie and Coffs Harbour, it's not as if there's nothing but beach shacks there. Plus there'd be more people these days who can run a business from home there instead of being in say Sydney or Brisbane but they'll still need to fly to those cities for clients. I think Bonza has its work cut out but best of luck to them, always like to see some competition and especially when they appear to be 'thinking differently' like Bonza is doing.

06 Feb 2021

Total posts 37

As noted by others, 737-Max seems too large a type of aircraft for regional services,  and the service schedule is going to be a couple of flights a week ?  The former are still going to have fuel, maintenance and staffing costs even if they can get a good leasing deal, and the latter is hardly going to be attractive to potential passengers, irrespective of the price.  It sounds like they are obviously hoping they can get rural airports desperate for traffic to stump up the money for the additional infrastructure that would be needed to service these planes over the typical smaller ones used at such locations, rather than using any cash of their own.  And a lot of the equipment needed for 737 Maxes won't be suitable to use on smaller aircraft flown by other operators,  so in financial viability terms, everyone else is carrying the risk if it goes belly up after a short period.  Sounds a lot like a dud deal to me.  

09 Aug 2015

Total posts 92

Fair point that the 737 MAX could be too large for many of these routes between smaller cities and towns, but then if it's only flying 2-3 days a week there's a better chance to get higher loads compared to a daily service. I think the key to this will be Bonza avoiding the big  cities as much as it can and just connecting these towns point-to-point, although Canberra is classified as a regional airport and you'd think it could stand a lot more services to places other than Sydney and Melbourne, eg Newcastle or Coffs Harbour or Noosa.

04 Dec 2017

Total posts 71

Another doomed 4th Australian carrier wannabe who chose the ill conceived 737 Max to boot....not a good start for any new venture.

Qantas - Qantas Frequent Flyer

01 Apr 2011

Total posts 44

Haven't we heard all the same old stuff trotted out before - right back to the days of Compass.  Australia is too big a country with too little population to support five airlines.  They might all operate at slightly different price points, but the market is just not big enough.  I am all for competition to stop price gouging, but it is just not practical here.  

The focus on regional airports fascinates me.  How many people want to fly to Mt Gambier for example for a holiday?  Not many on a weekly basis to justify the route I suspect.  Brad and Sharon and the kids want to go to the Gold Coast for their holidays.  No beaches and theme parks in Mt Gambier or Oodnadatta et al.  I might be wrong about this, but...  Business people on the other hand sometimes need to get to those regional towns.  But are they going to put up with 29 inch pitch, narrow seats,  over priced, buy-on-board  junk food, paid bags etc etc.  I think not.

Compass was a good airline, and deserved to succeed.  It had most of the right ingredients to make it work.  Given the right circumstances it still could have been flying today.

Mark my words, there will be tears before bedtime - yet again.   Qantas and Virgin won't sit idly by and let this little upstart eat their lunch.  As for Rex, they might as well start the fire sale now.  Yes, I am pessimistic, but we've seen it all before.

03 May 2021

Total posts 30

I’m excited and interested to see what route this airline will start, I’m thinking we could them running more flight from Queensland such as Townsville, Proserpine, Mackay, Sunshine Coast, and cairns. As well as possibly more flights from Broome, and flights from Busselton to Sydney and Brisbane.

Qantas - Qantas Frequent Flyer

22 May 2018

Total posts 43

I have held off commentating on this.. but one major question that has to be asked.. How many of these 120+ country towns that they claim to have been in contact with (on CH 7 news this afternoon), have a strip capable of taking a 737?? I have seen commentary regarding Mt gambier - having worked there at the airport that strip won't take a 737 and geographic features don't allow for extension. Here in Qld, apart from the coastal run serviced by Qantas/Virgin/Jetstar etc the only other to strips capable are Mt Isa and Longreach, with the first hardly being a tourist venue. Have also seen mentioned Adelaide to Broome, hardly a route that will fill a 737. Then there is pay extra for everything, cramped conditions etc. Start mid 2022.. belly up early 2023.  

12 Oct 2021

Total posts 1

@Executive Traveller

Would you guys consider doing a story - using route data, population statistics, airport statistics, etc to determine what type of routes Bonza would likely be looking at.

Breeze and Avelo have followed exactly this strategy in the US, along with Allegiant. They find the largest city pairs without a current non stop and go in mostly on weekends / high demand days. With a Focus on leisure destinations from mid sized cities

Examples for Bonza could be:

Newcastle > Cairns, Hamilton Island, Sunshine Coast, Proserpine

Canberra > Ballina, Cairns, Sunshine Coast, Hamilton Island

Hobart > Ballina, Sunshine Coast, Cairns

Avalon > just about anywhere

Adelaide > Ballina

 

24 Oct 2010

Total posts 2546

Hi Tim – an interesting idea but that sort of route analysis is not our bag, as we focus more on the traveller.

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 676

@TimAI - a starting point for a lot of what you ask is available on the Federal Government website by visiting the Bureau of Infrastructure and Transport Research Economics (bitre.gov.au). There are monthly analyses of International, Domestic air route(s) and passengers numbers, rail and road numbers etc. You can also research infrastructure capabilities of different towns, cities etc.

09 Aug 2015

Total posts 92

Yeah, I think Tim's idea would be really interesting to see a report breaking down all those numbers, possible routes etc, but it's what I would expect to read on a subscription-only aviation industry site like The Air Current due to how deep it would need to be and how much time and effort it would take to pull together. Also, the 'X Factor' here is which airports and LGAs will hand over money and maybe also reduced fees etc to Bonza, because those will be a higher priority for Bonza to consider servicing compared to airports and cities and towns which don't offer financial incentives.

Virgin Australia - Velocity Rewards

28 Nov 2018

Total posts 2

It would be good to see them servicing holiday locations not well serviced by the majors like Devonport, Wollongong, Toowoomba, Maroochydore, Norfolk Island, Uluru and Broome.

Virgin Australia - Velocity Rewards

24 Jan 2018

Total posts 517

Good PR for Executive Traveller on Nine News, David, you did a great job !!

Qantas - Qantas Frequent Flyer

24 Jan 2019

Total posts 3

I think Bonza will make a motza when skies reopen.  After that I wish them good luck based on history. 

Qantas - Qantas Frequent Flyer

21 Jun 2020

Total posts 4

Good Luck! you will need it

Sorry won't be flying with Bonza. they are going to use 737 MAX 8.

Wrong aircraft for this startup.

perfect aircraft for a start up. You obviously haven't looked at the Flair (Canada) business model.


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