Avelo’s Fleet Downsizing, Base Closures, and Exit from ICE Charter Sector Signal a New Era of Efficiency

HOUSTON, TX — In a sweeping series of manoeuvres aimed at fortifying its long-term financial stability, Avelo Airlines has announced a fundamental restructuring of its network and fleet. As of January 8, 2026, the Houston-based carrier is moving to retire nearly its entire Boeing 737-700 sub-fleet, shutter three operational bases, and, most notably, terminate its controversial charter contract with the U.S. Department of Homeland Security (DHS) for Immigration and Customs Enforcement (ICE) flights.

This "strategic reset" comes on the heels of a successful late-2025 recapitalisation, which CEO Andrew Levy described as placing the airline in its strongest cash position since its 2021 inception. However, the path to profitability in 2026 requires a leaner, more disciplined footprint.

Shifting Toward Commonality

Avelo is moving to simplify its operations by removing six Boeing 737-700 Next-Generation aircraft from its fleet. This reduction will leave the carrier with just two -700 variants and 14 larger, more efficient 737-800s.

The move is a precursor to a massive fleet modernisation plan. In September 2025, Avelo placed a firm order for up to 100 Embraer E195-E2 aircraft. These modern regional jets are slated to begin arriving in late 2026, offering superior fuel efficiency and the ability to operate out of shorter runways, critical for the airline's stronghold at Tweed-New Haven Airport (HVN)

Ending the ICE Charters

Perhaps the most significant development is Avelo's decision to cease all deportation flights operated on behalf of the Trump administration. Since launching these charters from a dedicated base in Phoenix-Mesa (AZA) in mid-2025, the airline has faced intense public scrutiny, protests, and legislative pressure, particularly in Delaware.

The airline, however, frames the exit through a purely economic lens. Courtney Goff, a spokesperson for Avelo, stated:

“The program provided short-term benefits but ultimately did not deliver enough consistent and predictable revenue to overcome its operational complexity and costs.”

All Avelo-operated ICE flights are scheduled to conclude by January 27, 2026, coinciding with the permanent closure of the Phoenix-Mesa base.

Network Consolidation

The carrier is consolidating its network around four primary "pillars": New Haven (HVN), Wilmington, DE (ILG), Charlotte/Concord (USA), and Lakeland/Orlando (LAL). Consequently, crew bases in Raleigh-Durham (RDU) and Wilmington, NC (ILM) will be shuttered by late January, though the airline will maintain service to these cities as “outstations.”

Despite the retrenchment, Avelo is already scouting its next frontier. The airline has confirmed it will open a new crew base at McKinney National Airport (TKI) near Dallas in late 2026, marking its first major foray into the Texas market.

Spring 2026 Expansion

While closing several routes, Avelo is doubling down on its "core four" bases with new services starting in February 2026.

A Mature Pivot

Avelo’s decision to exit the West Coast (completed in Dec 2025) and now trim its East Coast bases suggests a shift from "growth at all costs" to “profitable density.” By shedding the 737-700s and the operationally taxing ICE contract, the airline is clearing the runway for the arrival of the Embraer E2 fleet.