[j1ceasar]

SO if Thai airways decided to start flying from Norway to America – I guess it would be okay to pay their pilots and steward Thai wages ?

[canucklad]

hi Alex

Just a Thursday quickie, any idea how Westjet are getting on with their venture, and would Air Canada’s “Rouge” flighys be comsidered as an LCC operation?

[AMcWhirter]

Hello canucklad

I’ve no experience of Westjet so cannot comment. As for Air Canada Rouge I would say it’s not a LCC in the same mold as Norwegian.

[transtraxman]

Published today 3rd July 2014 in CAPA.
“Jet Naked. Another ULCC for Canada – how will Air Canada and WestJet respond?”

http://centreforaviation.com/analysis/jet-naked-another-ulcc-for-canada–how-will-air-canada-and-westjet-respond-175543

[BigDog.]

Alex –
The FT is running a headline :
Lufthansa Plots Another German Winner
Airline’s New Chief Focuses on low cost long haul service.

Unfortunately the FT link for further detail is incorrect. (some unrelated LH press release)

What is the story Alex?
Do you see AF/KLM IAG following suit?
If so will they be totally separate new brands, or could say IB (or indeed Vueling) morph into the loco and BA the premium brand.

[Ab0dache]

AF is already acting in this kind of way, at least on the type of “low-cost” service rendered to some of its passengers.

The B777-300 ER configured for 468 passengers (only 14J) once mainly only operated on the 8 to 11 hours domestic services to the French overseas departements (as the obligation of territorial continuity to Paris), then proposed on the so called international leisure routes such as Bangkok, are now -this current summer 2014- seen on one of the two daily flights to Beijing or to Lima for instance.

For sure it is not a specific low-cost organistion from AF but you have less crew in proportio of passengers taking those services.
And on those flight, to the contrary of the other international economy services, do not expect champagne as an aperitif. Those aircraft do not have the capacity to cater champagne to the economy passengers. Ewen worse; it seems like on the domestic flights (the 8 to 11 hours ones) that there is only one choice of meal and the aperitif is already on the tray served and choosen in advance by AF.

That sounds like a low cost proposal without paying for the meal. But I beleive you rather like on those flights to buy one of the proposed meal sold in advance for a fee. What BA seems to start offering from now.

[AMcWhirter]

Hello BigDog

Am not in the office at present so cannot access the FT piece.

But I suspect it refers to Lufthansa’s plans for low-cost, long-haul which were announced last month.

The general media make a big thing of it but, really, it’s believed that Lufthansa will develop Sun Express (a low-cost carrier which both it and Turkish Airlines jointly own).

The general media forget that Lufthansa used to operate a budget long-haul carrier called Condor. The latter, which specialised in holiday charter flights, was sold to Thomas Cook.

Lufthansa is very much a business airline. It would not wish to canabalise its bread and butter traffic. So if, for example, Sun Express were developed into a larger carrier I believe it would limit its operations to both holiday and low-yield long-haul destinations like Bangkok.

But can conventional carriers like Lufthansa successfully run long-haul, long-haul airlines ?

The boss of Air Asia/Air Asia X, Tony Fernandes, has already advised Lufthansa against this venture.

http://www.cnbc.com/id/101838256#.

As for AF/KL following … well AF already operates some B777-300ERs in a high density configuration, as Ab0dache notes above.

In addition they have two other carriers, Martinair and Transavia, which could be converted into low-cost long-haul divisions.

What about IAG ? I don’t know enough about Iberia to comment but, as for BA, I believe it has enough experience of the UK market to know that such a scheme is a non-starter.

What must be noted is that years ago BA did have a low-cost airline called BEA/British Airtours which operated cheap flights on both long and short-routes out of Gatwick.

BEA Airtours used redundant planes from both BEA and BOAC. In the early ’70s I took several flights with this carrier, including Amsterdam-Gatwick in a Comet 4B and Gatwick-Bangkok in a RR-engined B707.

The latter couldn’t fly non-stop so the flight was routed via Dubai (in those days Dubai’s terminal was smaller than that of LCY !) and Colombo.

In BT dated October 2013, paywall applies, I wrote an in-depth article about the viability of low-cost, long-haul.

It is interesting to note that two recent low-cost carriers, Norwegian and Air AsiaX, have either limited or cancelled their Europe-Asia routes.

Why ? Because as I have written many times, the Gulf carriers are such fierce competitors. By and large they are price competitive and. equally important, they serve many, many more routes.

The budget market is price sensitive. So why trek to Gatwick (for Air AsiaX) from Manchdester or Glasgow when you can fly Emirates (with better seating/free meals/baggage etc) for roughly the same price ?

So no wonder Air AsiaX quit the UK market and, according to Anna Aero, it has no intention of returning in the near future.

http://www.anna.aero/2014/07/23/airasia-x-still-heavily-reliant-australian-market-dropped-10-29-routes-started-since-launch-2007/

Likewise Norwegian started Scandinavia-Bangkok and later said it would conquer Asia. But nothing happened. All expansion since has been to the US.

[DavidGordon10]

Alex, an interesting and informative post, but may I comment on one point you make?

“Lufthansa is very much a business airline. It would not wish to canabalise its bread and butter traffic” – but that is, surely, exactly what it has done with German Wings? I have posted here before on the subject of “German Wings – never again”! The nature of German Wings is such that, as Star Alliance Gold and One World Silver, I choose BA between LHR and TXL rather than German Wings

[transtraxman]

I thought that Germanwings was to fly all non Munich and Frankfurt routes.

Do not knock Iberia. It is coming back little by little. Many people still like to fly the flag – even though it does not mean much these days. A very large proportion of the traffic between Europe and Central/South America is Hispanic who would not fly Air France, Lufthansa nor BA. They would only fly their national airline or Iberia and Air Europa.

[transtraxman]

The problems with Norwegian only go to show that you need back-up aircraft, which is a luxury for a small airline. The only solution seems to be that you concentrate your departures at only a few departure points and only fly to a few clustered destinations.

[BigDog.]

Thanks for the thorough analysis Alex.

There is a video clip of Carsten Spohr talking briefly on a range of subjects. His brief comment wrt loco short haul appears to be based on his belief that Lufthansa has one of the best (if not the best) global infrastructures from ticketing/service through to engineering which can be further leveraged using a separate loco brand without impacting the business brand

[MrMichael]

I avoid the low costs with two exceptions:-

1. If they are significantly cheaper than a full service carrier
2. If a full service carrier does not go where I want to go.

I have never booked a loco because it was cheaper, but have booked to go to Sharm El Sheik as no scheduled carrier from the UK flies the route. One can go on various airlines with a connection (often a poor connection) but not direct. Roll on October and my week in the sun with the delights of Easyjet to look forward to.

Back on topic, I think it unlikely I would choose Norwegian to go across the pond having read this forum. It is unlikely to be significantly cheaper, and it is not going anywhere I want to go that a full service is not.

The other issue is of course back up. My understanding of the loco model is that if things go wrong…..tough!

[canucklad]

Hi Alex, didn’t realize you had answered my question… .
Transtraxman’s attached article was interesting…. However doesn’t mention other failed attempts at creating a LCC in Canada. ….Examples that spring to mind are JetsGo, harmony and Royal if memory serves me . The good news is that Westjet has morphed from a LCC to a respected alternative to AC. When I’m back in BC I very rarely hear dissatisfaction with Westjet. As for AC Rouge, enough has been said elsewhere on the forum. And you’re right Alex….Rouge isn’t a real LCC.

However it does struggle with the same long haul challenges that face Norwegian and that AirAsia couldn’t overcome. …

Mr Michael , the secret of flying with LCC’s ? . Simple, it’s a question of setting your expectations ….
My toleFRance level is EDI – ALC, with a charged up tablet. And good company beside me! Oh and a few beers in the bar before boarding : )

[MrMichael]

Canucklad, I agree on all fronts especially the beer bit. I really just do not find the loco,s cheaper.

Strange, my last three posts have all involved beer, I must be obsessed!

[canucklad]

Mr Michael , You’re right about the cost…. To this day, the most expensive flight (£’s per mile/ time in the air) I’ve ever taken was a 20 minute hop PIK- Derry with ehmmmmm …… Europe’s self-proclaimed “ Low fares champion “ ….. No change out of £300 …To be fair, it was a return ticket.

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