Zoom expansion plans take flight with Bank of Scotland funding
John Penman
6 August 2006
The Sunday Times

ZOOM Airlines, the low-cost transatlantic airline owned by Scots travel entrepreneurs John and Hugh Boyle, is targeting a significant expansion into America and the Caribbean.

The plans will be part-funded by the Bank of Scotland taking a 7.5% stake in the airline for just less than Pounds 6m through its Growth Equity arm.

The investment will provide additional funds for the start-up of a UK-based airline for the Ottawa-based carrier, as well as assisting with a rolling fuel hedging package.

John Boyle, who made his Pounds 60m fortune by selling Direct Holidays to Airtours, said he wants to use the Easyjet model to develop the company.

The move also means he has ruled out plans to float the company on the stock market. Zoom's turnover for the past year was just more than Pounds 100m. Boyle and his brother own 90% of the company.

"We are more comfortable funding our future plans without going to the market," Boyle said. "For such a prestigious organisation as Bank of Scotland to take an equity stake is a tremendous vote of confidence in the success of Zoom.

"The investment will assist in setting up Zoom UK, which will enable us to expand our operations from the UK to non-Canadian destinations."

David Wilson, director of Bank of Scotland's growth equity, who negotiated the deal, said: "We view Zoom as a successful and innovative carrier with a considerable reputation for quality as well as value for money. It is an exceptional growth opportunity."

Zoom currently operates flights from a number of UK airports and Paris to destinations in Canada. It has flown about 750,000 people since being set up three years ago.

Boyle would not talk specifically about the new destinations but it is understood Zoom is looking at America, Mexico and the Caribbean.

The new flights are likely to be from Stansted and Gatwick. Zoom has already forced Air Canada out of the Scottish market with its cheap deals.

"While the low-cost carriers have grown in Europe because regulations protecting legacy carriers have been lifted, the same is not true of transatlantic flights," said Boyle.

"For example, if you choose to fly in and out of different airports with the main carriers, they will charge a fortune. We allow people to do that cheaply.

"We've pioneered the same model as Easyjet on our Canadian flights and we plan to be the transatlantic Easyjet for the new routes."

Boyle and his brother Hugh made their mark in the travel business by starting Direct Holidays, which they built up before selling to Airtours eight years ago.

Boyle runs investment company Hamilton Portfolio and also owns Motherwell FC. He lost millions in an attempt to challenge the dominance of the Old Firm, which led to the club recently spending two years in administration.

I wonder which routes they'll hit up first...

Zoom takes flight: Hugh Boyle increases winter-getaway flights, adds aircraft with GO Travel handling 70% of its vacation bookings online
8 September 2006
Montreal Gazette

Direct and Zoom Airlines, said yesterday he is stepping up flights to winter getaways from Montreal and other cities, and will add a fifth aircraft to his fleet to step up regular service to London and Paris next summer.

Scottish-born Boyle and his brother sold their Direct Holdings, the biggest direct seller of vacation packages in Britain, to Airtours Plc in 1998 for $200 million and moved to Ottawa to set up GO Travel in 2000. GO Travel sells directly to the public via the Internet, saving the 10 per cent to 20 per cent commissions normally paid to travel agents.

When he found airlines, influenced by travel agencies, would not let him book seats, he set up his own airline Zoom in 2002, picking up pilots from former charter carrier Canada 3000.

Zoom now provides scheduled services to London and Paris year-round from Canadian cities, and in winter shifts several aircraft to carry GO Travel vacation passengers to Mexico, the Dominican Republic and Cuba.

Boyle said 70 per cent of bookings are now done online, giving clients maximum information and choice, and this will soon hit 80 per cent. Others can use the company's call centre.

He is basing one of his Boeing 767s in Montreal this winter to fly to Caribbean destinations. In May, he will add the fifth 767 to provide more frequencies on the key London and Paris routes. His aircraft offer more room, with 270 seats, and his flights are free of Saturday restrictions.

"We were profitable last year and 2006 has been fantastic," Boyle said. "Zoom wants to be a low-cost full-service transatlantic airline, with a seat-mile cost 30-per-cent below the competition. I'll double the fleet to 10 aircraft in five years and cover more markets."

Boyle has complained to the Competition Bureau that some large tour operators have pressured sun-spot hotels not to do business with GO Travel. Several travel firms in Quebec and Ontario are being investigated and some are co-operating.

"More court details may soon be released, but this matter may take a couple of years to resolve," Boyle said.

My wish list: New York, Chicago, Los Angeles, San Francisco, Miami. :)

My less-realistic wish list: Rio de Janeiro. ;)

Low-cost London flights arrive in New York

NEW YORK, June 21 (Reuters) - Zoom Airlines, a low-cost Canadian carrier, began non-stop flights between New York and London on Thursday, challenging major airlines on lucrative transatlantic routes.

Zoom, which began operating transatlantic flights between the United Kingdom and Canada in 2003, is offering daily flights between New York's John F. Kennedy International Airport and London's Gatwick Airport for as low as $199 each way, excluding fees and taxes.

That is significantly lower than fares generally available from major carriers such as British Airways Plc and Delta Air Lines Inc. . A round trip ticket in mid-July runs about $800, or $400 one-way, according to a search on travel Web site Expedia.

The savings Zoom offers are somewhat mitigated by its use of only one aircraft on the New York-London route, which make passengers more vulnerable to delays and cancellations, said Terry Trippler, an airline expert who operates travel club Tripplertravel.com.

"Under normal conditions, United (Airlines) or American (Airlines) would be a better deal," Trippler said.

Both airlines offer similar flights for $50 or $100 more.

Low-cost carriers have made a huge impact in the airline industry, with carriers such as Ryanair Holdings Plc and Southwest Airlines Co. taking market share and dragging down air fares. But they have generally focused on domestic or short-haul routes so they could increase frequency.

Traditional network carriers in the United States have in recent years expanded their international service in part to escape low-cost competition domestically.

Start-up transatlantic service has generally focused on all business class flights. And it remains to be seen whether the low-cost model can work for international traffic, where comfort plays a bigger role.

But Zoom claims it works.

"We've been successful in the Canada to UK (market), so we're bringing the low-cost, long-haul model into the U.S.," said David Clements, vice president of sales and marketing.

He said the carrier is able to offer lower fares because it makes sure planes fly at 85 percent to 90 percent capacity -- which is typically fuller than rivals.

Also, the relatively new company is not burdened with unions and other expenses like the "legacy carriers," he said.

Economy class tickets can run as high as $399, depending on demand and season, but 20 percent to 25 percent of the seats will be available for the base fare, said Clements.

Slightly roomier premium seats are available for an additional $179 one way. Premium passengers are also entitled to express baggage claim and check in and an open bar.

All Zoom passengers receive a meal, snacks and in-flight entertainment included in their fare.

The low-cost carrier is hoping to expand its routes in the United States to one or two other cities, such as San Francisco or Boston within the next year, Clements said.

It has now zoomed out of existance.

Funny, how the article states that Zoom plans major expansion--yet it went bankrupt and is now an airline of the past!

out of services

Funny, how the article states that Zoom plans major expansion--yet it went bankrupt and is now an airline of the past!

Not really when concidering allot of peope have lost their jobs. :ohno:

It was in the press here yesterday new invertors want to re-start Zoom Airlines so who knows what could happen....

they were offering $99 fares from Canada to England not too long ago

no way they could survive at that price

^ I think that is before the fuel surcharges, which would easily double the fare.

its zoomed out as fast as it's zoomed in :ohno: