Airline franchising question
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Airline franchising question
Just a quick point, which I'm sure can be answered very quickly, can anyone tell me how the major airlines appoint their franchise carriers?
For example, did British Airways find a need for a South African airline and approach Comair, or did Comair approach BA with the benefits of a franchise operation?
For example, did British Airways find a need for a South African airline and approach Comair, or did Comair approach BA with the benefits of a franchise operation?
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Shrouded in secrecy. I am sure though that in the past a number of airlines have approached BA in respect of the big 'F'. To suceed the respective airline is audited for fiscal security and is given a number of books with the required standards that have to be achieved. In the case of Comair much of the set up work was done by BA as Comair were not 'jarops' nor were they compliant and conforming to the BA standard. It was also an outlet to offload clapped out 737's. It used to be that BA picked up about 15% of the gross of all a 'F' took and in addition charged them for all other services i.e. audits and uniforms. It seems a lot but clearly suits both parties. Didn't the 727 look good in BA colours.
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Some ex-Maersk Air UK employees might have something to say about BA and franchises. Some thought they would do better as an independent carrier - ie Duo - but for a number of reasons that didn't work.
Franchising was the "in thing" a few years back with CityFlyer being a prime example - but then it was taken into the BA fold and merged with BA Regional to become BA CitiExpress. There was also the short-lived National Jets Italia which is best not mentioned....
Franchising was the "in thing" a few years back with CityFlyer being a prime example - but then it was taken into the BA fold and merged with BA Regional to become BA CitiExpress. There was also the short-lived National Jets Italia which is best not mentioned....
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Classically a franchise carrier was either:
(a) covering a geographical area that the major didn't, and providing feed (e.g. Comair in S Africa);
(b) flying smaller aircraft on thinner routes than the major.
In those circumstances, franchising has the potential to work. In other circumstances ("we want our brand to be global, never mind the synergy, let's franchise everywhere" or "oops, this franchisee is now in competition with a company we've bought, so we'll have to cut back on the routes we allow the franchisee to fly whenever we renegotiate the deal") it doesn't work so well.
And I think that's all I'll say...
(a) covering a geographical area that the major didn't, and providing feed (e.g. Comair in S Africa);
(b) flying smaller aircraft on thinner routes than the major.
In those circumstances, franchising has the potential to work. In other circumstances ("we want our brand to be global, never mind the synergy, let's franchise everywhere" or "oops, this franchisee is now in competition with a company we've bought, so we'll have to cut back on the routes we allow the franchisee to fly whenever we renegotiate the deal") it doesn't work so well.
And I think that's all I'll say...
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The only BA franchise that seems to have worked is that with GB. And that airline seems to be a puppet run by some ex-BA management. It also seems very likely that GB will face much tougher competition soon as their BA style cost base makes them vulnerable. GB's strongest and largest market has been LGW-AGP but their decision to slash capacity this winter has left them with underused aircraft and has handed their competitors particularly Monarch a real golden windfall.
Brabazon
As a slight aside (and I think the crews will be well relieved that it was so), CityFlyer was merged into BA and not CitiExpress.
The latter problem child was an amalgam of Brymon,BRAL & BAR but did get the surplus ex CFE fleet of Avros.
I think you'll find BA has little interest in expanding franchising in the UK (except perhaps as a way of getting out of CitiExpress in due course?). Like the GO experiment, franchising as practised by BA (especially of the ex mainline routes) was a convenient way of avoiding the reality that BA had to do something about its own costs, and came to an embarrassing end when BA had to pay hefty sums to buy back what was arguably its own branded business.
As a slight aside (and I think the crews will be well relieved that it was so), CityFlyer was merged into BA and not CitiExpress.
The latter problem child was an amalgam of Brymon,BRAL & BAR but did get the surplus ex CFE fleet of Avros.
I think you'll find BA has little interest in expanding franchising in the UK (except perhaps as a way of getting out of CitiExpress in due course?). Like the GO experiment, franchising as practised by BA (especially of the ex mainline routes) was a convenient way of avoiding the reality that BA had to do something about its own costs, and came to an embarrassing end when BA had to pay hefty sums to buy back what was arguably its own branded business.
Last edited by Max Tow; 20th Dec 2004 at 14:13.
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M T is well thought out I asked on a BACX thread recently about 'corporate plan' and future and they did not seem too positive. It could be that BA might ditch them as bringing all that group together has been difficult and has lacked direction. BMED has been a sucess. It may as someone suggested earlier that 'F-ing' may have had its dayand there has been little of it in the last few yrs. For BACX the saving may be who would want to purchase them ?
