Avatar Airlines doesn't have any aircraft yet, or sufficient operating capital to get approval from federal agencies to fly, but that's not stopping company executives from touting its plans as the next big thing for the flying public.

Previously based in Las Vegas, Avatar recently relocated corporate offices to Boca Raton as it ramps up outreach to find investors to fund its operations.


"We've had our first meeting with the FAA and have filed our intentions with the DOT, and the next step is to raise funds," president and COO Marvin Ruthenberg said during a press conference Thursday.

Avatar hopes to raise $300 million through a private placement memorandum to purchase aircraft and fund operations.

If at least $150 million is raised and federal approvals are granted, Avatar should be in a position to launch new low-fare service to select cities across the country, Ruthenberg said. "We can't start up until we're funded."

Avatar was once known as Family Airlines, which was founded by Barry Michaels in the 1990s, but failed to gain federal approval to take flight. The U.S. Securities and Exchange Commission filed a suit against Michaels and his wife Holly in June 1996 for fraudulently offering $5 million in unregistered stock in the airline. A federal judge then ordered them to return $363,306 to investors and pay civil penalties.

Barry Michaels no longer holds a management position with Avatar, company documents filed last month with the Department of Transportation show.

Avatar plans to use Boeing 747 jumbo jets with 539 seats in economy class and 42 in business and offer "everyday" fares that are 50 percent or more below the lowest fares available in the markets it'll serve.

Ruthenberg said they were in negotiations for two 747's that were "parked in the desert."

Cities on its radar include Miami, Las Vegas, West Palm Beach, Orlando, New York and Los Angeles.

Based on early projections, an example of an everyday one-way fare from Miami to New York could be $49; Miami to Los Angeles $79 and Miami to Orlando $19, Avatar said.

Industry specialists say Avatar will have its work cut out for it.

"They will need an enormous amount of money and a very, very sound business plan to start up and succeed in the airline business," said Henry Harteveldt, travel industry analyst and founder of Atmosphere Research Group in San Francisco.

Others say its choice of Boeing 747s could be problematic.

"The operating costs of an old aircraft (assuming they're buying used ones) with four engines are rather high," said Seth Kaplan of Fort Lauderdale-based trade publication Airline Weekly. "High costs and low fares don't generally lead to profits."

asatchell@tribune.com, 954-356-4209 or Twitter@TheSatchreport.