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Memorial Day air travel set to boom as a rapidly expanding airline industry rises to meet demand

Two new airlines launch, offering low fares
Two new airlines offering low fares to smaller airports launch 02:52

American air travel is set to make a comeback with 60% more people expected to travel this Memorial Day weekend, compared to last year.

For some of the more than 37 million Americans likely to travel, an expanding airline industry now means a selection of new, cost-effective options. 

"$19 flight — doesn't really get any cheaper than that," says Memorial Day traveler Dylan Herrera.

That's how Avelo Airlines CEO Andrew Levy is trying to boost demand for his new low-cost airline. 

"We're trying to go out there and give customers choice," Levy told CBS News' transportation correspondent Errol Barnett. "We have wonderful people, great low fares. And, yeah, we're just excited to be out in the marketplace."

Avelo's hub is based in Burbank, California, and currently services 11 small airports in the West and Midwest.

"There may be other ways to get to these airports in the Western U.S., maybe through LAX, maybe through a connection. But we're trying to offer something that's different to the customer, to the traveling public," Levy said.

The company is already expanding, with a second hub opening in New Haven, Connecticut. 

The airline industry lost more than $370 billion last year because of the coronavirus pandemic. Boeing's CEO declared at the time that at last one airline would be pushed out of business.

Instead, two new ones sprung up — Avelo and Breeze Airways — with the goal of tackling tackle smaller airports across the country.

"By the middle of the summer we'll be in 15 cities," Breeze CEO David Neeleman projected.

Breeze is also testing a new market — 95% of the routes on its network are new, non-stop services including flights from Connecticut to Ohio and Rhode Island to Pennsylvania. Fares start as low as $39.

Airline travel expert Henry Harteveldt thinks the travel industry is bouncing back.

"It is recovering faster and better than many expected," he said.

Harteveldt credited an expanding market for the comeback.

"These are both budget-focused airlines, which means they'll bring more low-fare seats to more communities. And that helps make air travel more accessible and affordable for everybody"

The growth of budget airlines puts more pressure on larger carriers such as JetBlue, Southwest, American and Delta.

But while this upcoming weekend is a boom for these smaller airlines, it's an open question as to whether there are enough air travelers to sustain them long term. The last U.S. airline to launch, Virgin America, folded in 2018. 

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