If there is going to be a European LF airlines "Blood Bath", who wont survive?

[eoinok]

If the above happens, as MOL and the "analysts" are predicitng will happen this Winter, who do you think is gonna go bust??

Viewing this list might help people see a list of so called LF Airlines.... http://www.discountairfares.com/lcosteur.htm

[LatviaCalling]

Well, it's hard to say for the others, but airBaltic, 48% owned by SAS, I would say, will tough it out despite the competition.

It already has to compete with BA on the London route, and it will have a new arrival via Ryanair in November which will be going to Stanstead instead of Heathrow, plus some darn place 120 ks outside of Frankfurt and about 130 ks north of Helsinki. The next arrival will be EasyJet (don't know exactly when) which will be going to Gatwick.

I don't know about that site calling airBaltic a low-cost airline. Like most, they advertise one price without taxes, dues, security, etc. and if you don't book way ahead of time, you end up paying only about GBP 5 less than BA.

They'll have a tough road ahead with the real low-cost airlines coming in, but I think that they will survive, since the government owns just a little more than half of it and if things really start looking bad, then they will really make it a low-cost airline. The site failed to include their direct London, Dublin and Milan routes.

[smallpilot]

Its the ones with poor cashflow and/or lack of cash reserves that will struggle... Ryanair + Easy should be ok on that basis. Those owned by flag-carriers may be able to survive if cash reserves are strong. As for the others... well, if they have a strong local market/niche service (eg Flybe) then they have a chance if the big boys dont muscle-in on their territory, otherwise it could be very tough. My guess is carriers in Germany, eastern Europe and Scandinavia are most at risk, together with full-fare airlines that get dragged into a routes/price battle.

[eal401]

I agree that FR and EZY should weather the storm well enough. Those that might struggle may be the ones that are subsidiaries, e.g. bmibaby & My Travel Lite, particularly if the parent companies feel any financial squeezes. But that's just my own speculation.

[Jetavia]

Here is the view of www.czechaerospace.cz:


In our recent survey of Low Cost Carriers (LCC) Brands, we rather call them Low Fare Airlines, as low cost seems negative from the consumers opinion side.
The winners in the LAA market will be those carriers that have the strongest brands, now we group those brand requirements into :

1 ability to consistently deliver on the cutomer promise
2 customer service quality
3 clarity of customer promise
4 product/service offered
5 consistency of message and brand
6 employee commitment
7 brand values
8 knowledgeable management
9 advertising/marketing
10 vision and mission
11 logo/identity
12 internal communications
13 company name

From these requirements we rated each LCC and how well they address these key requirements and our list of Low Cost Carriers that we believe will survive into 2006 and beyond in Europe are :

1 Ryanair
2 EasyJet
3 Helvetic Airlines
4 Sterling European
5 ThomsonFly
6 My Travel Lite
7 Germania Express
8 Virgin Express
9 German Wings
10 Volareweb
11 Air Berlin
12 Wizz Air

The LCC we beleive will NOT survive into 2006 as they are not in our opinion adhearing to a proper long term strategy/branding that will sustain them in the long/medium term, especially once competition heats up between LCC's, these carriers in our opinion will fail :

1) Snowlflake
2) WindJet
3) EU Jet
4) Iceland Express
5) Sky Europe
6) Fly BE
7) Norwegian
8) Air Scotland
9) Air Polonia
10) Hapag Lloyd Express
11) Smart Wings

The jury is still out on the following, as they seem to be putting their strategy/brand in order yet their future is very much dependent on what their competitors will do:

1) BMI baby
2) Jet 2

[eoinok]

Cheer's Jetavia, interesting list you have there!

The biigest surprise to me on the list that you have mentioned of Low Cost carriers that you think wont survive, is Sky Europe and Flybe.

But obviously, you have analysed this in a far more detailed and scientific method than what I would.

[egnxema]

Another surprise is that you think Hapag Lloyd Express will sink, but Thomsonfly will stay - they are sister companies with the same parents - why the difference?

[pwalhx]

I too am surprised about HLX and Thomsonfly being viewed seperately, surely it is in TUI interest to either make them both succeed or maybe merge the two at some point.

As for FlyBe they have strong support in the UK market I think they have a good chance, They have carved a niche where other airlines such as BA and maybe BMI don't want to go.

[LGS6753]

Jetavia's approach is certainly interesting, but many of his criteria, though relevant, leave room for subjective judgements.

My own subjective judgement is based on three criteria: the clarity of an airline's strategy - I feel that airlines that pick up and drop routes quickly, or carry out their strategy in a half-hearted manner are in danger; the extent and commitment of its financial security; and finally the strength and effectiveness of its total marketing strategy (including livery, identity, name and visibility).

On this basis, my survivors are ( of those with which I am familiar):

1. Ryanair
2. Easy Jet
3. Jet 2
4. Wizzair
5. Monarch Scheduled

The almost certain failures are:

1. MyTravel Lite
2. FlyBE
3. Air Polonia
4. EU Jet

The questionable ones are:

1. Volare
2. Sky Europe
3. BMI baby
4. Thomsonfly/Hapag Lloyd Express


And those about which I don't know enough are Air Berlin, Helvetica, GermanWings, Virgin Express, Sterling, Germania, and the others on Jetavia's list. It does seem inevitable though, that at least one of the German operators will fail sooner or later.

[FlyLowCost]

On this basis the sure survivors will be only the airlines with a stong domestic or hub market that offer cash cow routes:

1. Ryanair (routes DUB-UK or STN-Europe)
2. Easyjet (strong in UK domestic market and first choice for UK resident price sensitive).
3. AirBerlin (leader on leisure routes from Germany)
4. Monarch Scheduled (very strong brand)
5. Volareweb (large domestic operations in Italy)
6 Germanwings (dispite they are still a small carrier they are moving well in the market).

The questionable ones are:

1. FlyBe
2. BMI Baby
3. SkyEurope
4. Jet2 (too small even if they offer a good product. Their future at this stage is too connected with Big Boys strategies)
5. WizzAir and Air Polonia (east european market is not so strong to support both. I see Air Polonia in a better position mainly due to the marketing agreement with HLX and VAweb)
6. HLX and Thonsonfly
7. Norwegian

The almost certain failures are:

1. EUjet
2. Vueling
3. Helvetic
4. Smart Wings
5. Iceland Express
6. Snowflake

[colegate]

Jetavia's posting is very interesting. To their list of criteria I would add:
unit costs
cash management
distribution cost per passenger
load factors ( because thsese are a measure of any excess capacity on routes or in the market generally.)

Jetavia did not include Monarch but they have a very clear strategy, clear branding, competitive prices and clear product differentation. They have a limited route network but it is clearly orientated to the largest sun destinations and they have not got embrioled in Northern Europe mixed business/scheduled routes. I am certain that they will survive and expand. They are attracting a very loyal customer base.

I agree with the points made about brand confusion. Flybe has changed strategy seemingly many times andit is not clear to me where they stand. This confusion is made worse by their fleet strategy. How the 146 and Q400 can compete in the low fare markets is beyond me.

bmi baby is a very confused brand and has what appears to be an experimental route strategy.

To suggest that MyTravelLite is going to be a survivor when their parent has recently announced that they are cutting their UK aircraft fleet from 31 to 20 aircraft defies reason. Is it really likely that supporting Lite against growing competition at BHX is the best use of their seriously depleted funds and of those aircraft? Surely they will want to protect their core business of tour operating?

EU Jet will have a massive problem in competing afrom probably Britain's least known and arguably worst located airport.

[Barbara Cassani]

I agree. There is no way Flybe will survive. They have no direction and to think a Dash 8 is the answer to there problems they are grossly mislead. I don't think they will go to the wall, they probably will be bought out by a non UK carrier. In a statement from the board they said that a new jet was out of the question, so it looks like its an all prop operation for the forseable future.

As for BMI baby they aint going to survive either. Yes they have a mega rich owner but just like flybe there is a limit to how much money they are prepared to put in. Again I think they will be bought out, probably by Ryan Air.

Easy are not as secure some make out. There value is a quarter of what it was and many of there routes are running at a loss. The only thing keeping them afloat is there expansion. Stop that and thats curtains for them.

How about a moderator organising a vote??

[Cyrano]

Barbara,
I recall that a couple of weeks ago you were convinced that flyBE and bmibaby were going to merge, so I gather you've changed your mind.

Are you familiar with Dash 8 operating economics? I have to say that for short routes like Birmingham to Scotland, the Dash 8 (especially with the deal flyBE got from Bombardier on their initial crop of them) is probably better than any competing aircraft, including the 737. The fact that no-one else is operating the aircraft in the UK market means that flyBE if they choose can go after routes that are too thin to justify a daily 150-seater.

The international routes are where things are a bit tougher for flyBE. They're carving out a little niche on regional UK to regional France, but their Avro RJs/146s are not well so suited to the long sectors down to the south of Spain (range and speed). Then again, I wouldn't rule the type out completely - the operating cost position also depends on what kind of lease rentals they've got them on.

C.

[Avman]

Interestingly, none of you "experts" have included V-Bird in your predictions. So, just how much do you really know about "LF" airlines? :*

[carbootking]

can any one tell me why iceland express will fail when half the pax who leave bags for the day at luggage deposit are from iceland express .so it seems their flights r full .

[ALLMCC]

Seems as though these are more likely to be "wish lists" rather than predictions - strange that both Easyjet and Ryanair are predicted to survive yet both have issued profit warnings in the past six months!

It matters little how big the bubble is, it can still burst! The bigger they get, the more unwieldy they can become and the harder they will fall!

[prob30]

...yes but easy's £440M in the bank may help take the edge off for a while!! Flybe have £2.50 from the bottom of the drinks machine to play with...

[Nil further]

prob30

you are wrong about the £2.50 from the drinks machine being available , that cash was short term working capital injection from the trustees and will be sent to JER very shortly (along with the money for the LHR slots)

NF

[prob30]

the drinks are free at EXT HQ so there isnt £2.50 after all...

[Wycombe]

....and since when have BE had any Avro's Cyrano?

Most of their 146's are quite early models AFAIK (with the possible exclusion of the ex-Thai 300's).

If performance at SOU is anything to go by (now their largest hub I guess), they seem to have carved out that niche pretty well and are going for the BACX jugular by launching GLA and MAN soon.

[Electric Sky]

Sounds like SAS have today announced that Snowflake will be no more.

ES ;)

[bmibaby.com]

Just some inside information from within the SAS Group, there are no plans for the Snowflake brand to disappear, but instead Snowflake branded service is being rolled out across the SAS mainline (and some SK Commuter) flights. The idea is that SAS can offer business class, full-fare economy, and budget class (snowflake) on all flights, and therefore being able to attract the business passengers in business & full-fare economy, and the budget & leisure travellers Snowflake has attracted in the new budget cabin. All-Snowflake flights will remain on routes with strong leisure traffic, like AGP. This is no different than to what Air Canada did to their Tango brand.

Personally, I doubt that we'll be left with just two no-frills airlines. Europe is far too big for just two. I think it'll be left to six.

Most likely, EasyJet & Ryanair, as the big Pan-European major no-frills airlines. Air Berlin/Niki serving the German/Austrian market. Wizz Air or SkyEurope in Eastern Europe. FlyBe as a hybrid no-frills/regional. And then a big no-frills airline owned by a major or group of majors. My guess ... a merger between WW/4U.

[Runway 31]

With the way things have been going over the last few days, is it possible that the demise of low fare carriers is the last thing that people should be worried about.

The high fare carriers are having problems and some of them are the ones that people should be worrying about.

[Navajo8686]

Not to long ago a Lo-Co was very easy to identify - they had a fares structure that was very (clearly) considerably cheaper than the main operators.

Now that does not appear to be the case - EZY and FR are exceptions but they can still be quite expensive - but many of the other Lo-Co's have very odd fare structures.

There are some I never fly with as the fares are to high - the difference between their cheap fare and a getting a decent normal fare journey is not enough!

The usual Lo-Co trick is to advertise a cheap fare but on checking further it is at such stupid times that no-one could ever want to take it up (i.e last one out of BHX and first one back so you are out of the country for 8 hours which is pointess for sight seeing!) so it's worthless OR the outward fare is 49p (and advertised as such) but the inbound fare is £160. This is not Lo-Co - it's variable fares some of which are cheap!

For many of the Lo-Co's to survive they are going to have to clearly differentiate themselves as the mainstream offer cheaper fares. I'm off to Frankfurt in a couple of weeks with Lufthansa for £104 all in - FR from STN worked out at nearly that (£90) by the time I'd added in the shuttle bus - That does not include the parking st STN. The difference was not sufficiently high enough to have the hassle of the inconvenience!

Bernie

[Jetstar81]

I hadn't forgotten about V-Bird, unfortunately it's another one that's destined for failure due to a lot of low yielding traffic and a fiar number of routes with low load factors.

Easy and Ryan will survive long term. They may well have issued profit warnings, but they have enough money in the bank and investors to afford a re-structure if it's needed in the future. FlyBE will survive longer term than 2006 but not much longer, last years profits were due to their engineering business and the sale of the LHR slots. The biggest battles are now where low cost airlines are starting to directly compete against each other and this will determine who survives.

Abeam Points - BACX aren't in the low fares arena and don't have to pay Franchise Fee's to BA as they're a wholly owned subsidery so have plently of financial backing from their parent company.

[Ryanmurphy]

Hopefully BMI will last the course,they have a convenient schedule out of EICK to various UK destinations :uhoh:

[LGS6753]

According to ATW online, HLX is launching a 'major expansion' in November by adding 18 flights a week into Salzburg.

They expect to break even in the third quarter, but their CEO acknowledges that there will be a 'brutal price war' this winter and some LCCs won't survive.

HLX plan to add 2 East European destinations next year. They operate 11 737s.

Comments:

It will have taken them 2 years to break even.
Their 'major expansion' equates to less than one additional aircraft.
They have obviously been haemorraging money for two years. They will continue to do so this winter.
One (peak) quarter at 'break even' is not enough.
Their strategy has changed (from inter-city to leisure destinations)

I wonder how long TUI will bankroll them?

[TwinAisle]

One of the things that my studies have shown is a marked (and early) differentiation between the low cost carriers.

If you go back just a few years, your choices for flying around Europe were pretty limited -

- Major carrier (BA, AF, LH etc)
- Second tier (BD, Air Inter etc)
- Charter

What we have seen develop quickly is a three tier low-cost sector - with increasing blurring between the tiers:

- Major carrier (BA, AF, LH etc)
- Second tier (BD, Air Inter etc)
- Charter
- Wannabe low cost (eg flybe)
- Quality low cost (Go, easyJet, bmiBaby)
- Bargain basement (Ryanair)

My take on this is that there will always be space in the market for the lowest price. Ryanair are therefore pretty secure (barring, god forbid, any accidents, but that applies equally across the industry)

The qualities, I think, will start pushing more and more upmarket, as an air ticket becomes a more and more commoditized product. I think you will see a major squeeze on the wannabes and the second tier carriers, making the likes of flybe and bmi mainline more vulnerable than they would like to believe. I think you are also going to see a scrap in the quality section - but not for a few years yet; they will have enough on their plates as they improve the product and take on more and more of the established players.

So - short term, I'd be worried for flybe (their niche status won't help them, the locos have proved adept at developing the most unlikely bases and city pairs - Bournemouth to Hahn, Cardiff to Prague!!?!) and the likes of bmi regional.

Medium term - there will be a cleaning out of the quality sector - likely to be by acquisition and withdrawal, rather than bankruptcy - although acquisition has been an issue - easy still seem to have major indigestion with Go (the best loco by far, for all sorts of reasons - well done to BC, my role model!), and I can't see any of them swallowing up any of the others without pain. Jet2 is pretty vulnerable I would guess, due to its size.... they will disappear smallest first.

Barbara Cassani's comment (is that really you??) about easyJet not being as secure as you'd think may well be true. They are building capacity at a phenomenal rate, and I have seen loads of businesses going tango-uniform like this. Hope that RW knows what he is doing, but at $50 a barrel for oil, he may be in for a tough time.

Ryanair is already showing signs of going a bit upmarket (no, don't laugh) - but provided they stick with their strategy of "never undersold" they will be fine.

The likes of Wizz should be fine - for a bit - since they are on virgin territory to a large degree. I tend to agree about ThomsonFly, who seem to have an identity crisis (charter or loco?) and MyTravelLite (who again seem to want to be charter when it suits them).

TA

[beauport potato man]

wow!!

after that damning verdict, as i belong to a company that, in everyones opinion is at best "unlikely to survive" and at worst "going under next year" i'd better dust off the ol'CV.

Now where's that large queue of MyTravel pilots, i'll go wait behind them.........

[terrier21]

I cant understand all this talk about fly be getting axed. I remember them as jersey european and british european and i can see the massive differences they have made to them selves since those days.
I think they will survive this time round because they serve a different variety of destinations than EZY or RYR, I think this suits them because they fly to areas that passengers want to travel to for other purposes than buisness and holidays, like second home destinations and quieter short brakes. Hey but what do I know:E

[unwiseowl]

I think EasyJet and to a lesser degree, Ryanair, have painted themselves into a corner with their massive aircraft orders. They have no choice now but to keep expanding. Each new aircraft is a liability! In the whole history of European aviation, has any airline ever planned to expand at this rate and survived?

[In trim]

unwiseowl,

I would actually argue the opposite.....that in the newly enlarged EU and with the freedom to operate anywhere within Europe (unlike other carriers in the past such as Air Europe which were in a different era!), then it is the size which will 'carry the big boys through' the tough market at present. It's the smaller airlines which are likely to suffer by not having a critical mass in a given market.

[Flightmapping]

Unwiseowl,

Isn't the problem with massive expansion having the cash to pay for all the new equipment? That shouldn't be a problem for EZY & RYR, with the cash reserves they have. These markets will only open up once, so first mover advantage really counts.

I agree with terrier21 about flybe. Their strategy may appear muddled, but they do have a clear niche in smaller airports, where either the market, or facilities, is not big enough to support larger aircraft / airlines. Surely, they will maintain a stronghold at JER, GCI, EXT, SOU & BHD? Their only other major presence at BHX might not be so secure, but here they can offer frequency to appeal to business pax, which baby can't.

[averytdeaconharry]

In trim, you are right about critical mass. But critical mass in markets like Exeter means nothing. What does matter is critical mass in big markets because it is only those markets which can generate the traffic to fill all those future aircraft orders. RYR and EZY are both big in London which is the largest air transport market in the world. That does not guarantee success but it sure helps. Dominating Exeter, for example, is a niche which may or may not be profitable but in overall terms it is irrelevant.

The rules that have workred for decades are that dominance works, so do niches. Try to jump out of a niche and get into something bigger is almost always a disaster. RYR is probably the only European airline that has succeeded at this. But it has had two advantages. It dominates the important Irish Sea routes ans it got unlimited access to STN when that airport was empty and desperate for traffic.

[terrier21]

Thanks for agreeing flight mapping.
But Flybe have seen their success at Brs grow recently and will hopefully continue to grow all of that along side easyjet who now have the largest uk presense in britain outside of london here at Brs.

[JB007]

FlyBe - 3rd largest low-cost carrier in Europe - it's official! (http://www2.flybe.com/news/0408/13a.htm)

[fimbles]

Terrier21

A quick jump to the piccy on the following home page will show that you might just be a little premature with your statement....
www.nwan.co.uk

[FlyLowCost]

FlyBe claims to be the 3rd largest European low fares carrier, but only because they consider for their statistics only the Air Berlin City Shuttle service.
AB will carry about 12m pax this year, I doubt FlyBe could carry half of AB pax....

[Trislander]

What many people fail to realise (including the so-called "expert" analysists on this thread) is that flybe aren't trying to compete with the likes of easy-ryan. Anyone can see that, if you look at their routes and the markets they are aimed at, mainly 2nd home-owners who live in Southern UK who are not short of a few bob. They have also opened up Europe to the regions at not necessarily the cheapest, but still reasonable prices considering the convenience of flying from a local airport. Their other market of course is linking the regions of the UK offering better prices and more convenience than catching a train (e.g. SOU-EDI).

Flybe are beginning to send back some of their 146's, but this does not mean the end of their jet ops. My bet, and rumour is that when they have sent back the old leased ones and sold off those remaing that they own, they will be in a prime position to ask Mr Airbus for a deal, before getting rid of the 146 altogether.

An "expert" mentioned earlier in this thread that the Bombardier Q400 is not the a/c for a low-fare airline. On the contrary- the Q400 is so cheap to run that it only has to be half-full to break even, based on each seat being £75 (They are often more expensive than that, too). Every other seat filled after that is pure profit. On most of the sectors operated by the Q400, 97% of the seats are filled.

The Q400 flies almost as quick as a jet, and can operate comfortably to/from some of the smaller airfields in France they fly to with full loads in hot n' high conditions.

Using the Q400 on regional UK routes means that they only have 78 seats to fill instead of a 737's 150+ seats, and again making profit after the 50% load factor mark. Buying the Q400 wasn't a stupid idea, it was an intelligent one.

Analyse that, "experts"!:p

[beauport potato man]

Fimbles,

i think terrier was just saying that flybe have grown in bristol (which they have) operating on different routes to easy.

I don't think he was suggesting to flybe being BIGGER than easy at bristol.

So why the link to the picture on www.nwan.co.uk?

Everyone with a brain knows that Easy are the biggest operator at BRS.

Many thanks for pointing it out though.

[terrier21]

very true. I wasnt suggesting Flybe are looking to take on Easy which wouldnt be the wisest move, I was just suggesting that Flybe are holding their own.

What has always suprised me is that Ryanair have not decided to introduce more routes from bristol other than there Dub service 3 times a day which is often full, especially after Ba stopped the service and Ei put on a once a day service.

[MerchantVenturer]

terrier

I must admit that I misread your earlier post as saying that easyJet's BRS presence was the largest in Britain outside London, and I believe that fimbles is suggesting that LPL is.

As you know BRS has 6 based easy a/c and I believe that LPL has 7 or 8. However, this is only part of the picture because a glance at the easyJet web timetable shows LPL as having 13 destinations and BRS 20, but some of LPL's routes are higher frequency than BRS. Even this has to be broken down because BIO and CPH are to be discontinued from BRS in the winter and MAD, BUD, CIA and GVA will replace them, giving BRS 18 winter destinations.

Furthermore, 7 of BRS's weekdaily return services are operated by easy a/c based elswhere, viz BFS x 3, NCL x 3 and SXF x 1 which is the equivalent of two based a/c.

So whether BRS or LPL is 'larger' depends on what criteria are being used.

As for Ryanair I will not be surprised if the three daily rotations are reduced to two when the 738s replace the 732s.

The overall subject of this thread will doubtless have even more of a bearing on future plans than might otherwise have been the case.

[Baron rouge]

How can EASYJET and RYANAIR people be so sure that the money in the bank will be used to support the company's operations ?

Just remember SWISSAIR and all parent companies;)

[Runway 31]

What are they going to do with it then Baron.

[TwinAisle]

Trislander

An interesting thought

What many people fail to realise (including the so-called "expert" analysists on this thread) is that flybe aren't trying to compete with the likes of easy-ryan.

- but the problem is that it won't be up to flybe in the main to decide who they compete against. If the second home owners in the South West suddenly find themselves with the choice of flybe and easy/Ryan (who may well start looking for more and more "odd" city pairs as the market starts to saturate), flybe could be in trouble. If the likes of EZY appear at EXT, doing TLS, flybe will just HAVE to compete - whether they want to or not - or just surrender the route....

TA

[averytdeaconharry]

Several of the postings in this thread have referred to cash and the cash piles of EZY and RYR. British readers will know of a company that used to be called GEC and which was run by Lord Weinstock. That company had a cash mountain of around £1billion for a decade or more. In their case that cash was surplus to investment requirements and was not needed for working capital. It was genuinely there on top of all business needs. Cash of that sort can genuinley be classed as an asset.

In the case of EZY and RYR and any similar airlines the cash is mainly derived from advanced ticket payments. As such it is a liability until the relevant flight has been flown. It includes advance payments for taxes which have to be paid after the flight has been flown.

That cash has to be used for progress payments on aircraft, leases, etc.

If you look at the cash in relation to capital spending committments you will see that it is small. It will certainly be enough cash to ride out any short term problems but you have to look at the wider picture.

At the moment both airlines are growing far faster than average industry growth over any period in the last 50 years but itf that growth falters or stops then that cash will rapidly dissipate unless they abandon their growth plans. It was always thus in the airline business and I submit that it will always be thus. It was mathematically proved by an academic study called Simplistic Airways in the early 1970's

You can certainly say that EZY and RYR would enter any downturn period in a position of strength and that certainly means that they would outlast weaker competitors.

[MerchantVenturer]

.If the likes of EZY appear at EXT, doing TLS, flybe will just HAVE to compete - whether they want to or not - or just surrender the route....

Flybe's strategy re the smaller airports/secondary routes is well thought in my view.

For example, from EXT they fly to the sun spots of Malaga and Alicante using smaller aircraft (146s) than the normal low cost airlines' 737s/319s. They probably recognise that a 737 would be difficult to fill on these routes using the same schedules as the 146, although the loads so far appear to suggest that larger aircraft might be viable to these particular destinations from EXT.

Flybe also fly from EXT to such as EDI, GLA, DUB and BHD but not at the frequency that more traditional lowcost airlines do from larger airports(Flybe is usually once a day).

Flybe also recognise that there is a market in the south west for the likes of Toulouse, Bergerac and Bordeaux. However, they realise that EXT would probably not have enough pax in its catchment area so Flybe operate these destinations for south west pax from BRS instead. Even here a 737/319 would probably be too big so they utilise 146s and DH 8-400s for daily flights and loads (according to CAA) average 75-85%.

I cannot see easy or Ryanair trying to oust Flybe at BRS on TLS, EGC or BOD. There just would not be enough passengers to fill the daily flights at economic yields. After all easy have decided to withdraw the Bristol-Bilbao service from October yet this route carried 7816 pax in July (CAA provisional figures), an average load of 126 (85%), so presumably they can make more money on other routes. Would they get these kind of loads on daily TLS, EGC or BOD? I doubt it.

I think Flybe have a well thought out strategy. In addition to EXT and BRS, look at the burgeoning services from SOU where traditional sun routes and 'secondary routes' are both flown. I suppose easy or Ryan might look at SOU for sun routes although technical experts might tell me that the runway could be a problem in some conditions for 737s

[Arrowhead]

Old business saying "all markets eventually go to three"... which means upto 3 airlines on each European short-haul route.

Firstly, several of W Europe's incumbents will have to give up short-haul (SN/AerLingus/Swiss/Alitalia/AF). The money has to stop flowing to these loss makers, eventually.

Meanwhile, Easy and Ryanair (probably plus maybe one other) will eventually buy out their more successful competitors. Some targets will get reasonable prices, other will go for peanuts. But Easy+Ryanair (+1 other?) must ultimately end up at least as big as, or even bigger than, the old incumbents. Buzz and Go are early examples, but I suspect there are plenty more to come (particularly on the continent).

This also means most of the other small competitors will simply disappear, or remain very niche... Exciting times. Roll on the Ryan and Easy hoovers.

Ryanair to buy AirBerlin


>>---->

[Barbara Cassani]

Any runway can be limiting in certain conditions. In fact the 146 is limiting at SOU. Why do you think Flybe operate a 200 series out of there? There is no problems worth talking about with regards to a 737, Airbus or 757. How much runway do you want? I think you will find the problem is parking space. Back to the original thread now..... Further to the latest board meeting at Flybe the company will be sold as an all Dash 8 fleet. The first of the 146's are being returned at the end of the summer. That is fact. It is on the aircraft rotation plan for October. As for the Q400, one was stuck in Reykjavik day before yesterday tech! They are the future!

[MerchantVenturer]

Barbara Cassani

Thanks for that about SOU. The only reason I mentioned the runway was because I have read in other threads that it can be a limiting factor. I am grateful for your clarification.

I also read with interest your comments about Flybe's recent board meeting.

[colegate]

Thanks Barbara. It would certainly make sense for Flybe to be an all Q400 operator especially if it cannot afford a replacement jet for the outdated and old 146's. But that also means that is will be limited to short range routes. The likes of SOU-PRG and SOU-AGP will have to be scrapped.

But it all adds up to yet another strategy change for the company. It will have gone from Jersey European (dominated by Channel Islands business) to British European (intended to specialise in markets with strong financial services traffic) to Flybe ( a look alike low fare airline with the wrong aircraft for that role) to whatever as a specialist Q400 operator. And that all within five years. Incredible except that it has happened. To me it suggests that the company has been losing money heavily as Flybe and is being forced to retrench into some new core markets.

[Trislander]

Barbara Cassani,
----------------------
How do you know what flybe say in their board meetings unless you are in some way associated with the airline:confused:

Colegate,
------------
The Q400 is being brought in to replace some of the routes currently operated by the older 146's which would make more money for the company than running the 146 on those routes. The Q400 can do and has done SOU-PRG, but it would take just 10-15 mins longer than the 146.

They make too much money out of the Spanish routes to drop them. They are retaining a smaller number of 146's to operate these routes until an alternative jet is implemented. Don't you think that the company has thought all this through?!

Twin aisle,
-------------
Point taken but I have to agree with Merchant Venturer that there is a demand for the routes flybe operate on, hence high pax loads - but not enough for 150 seat operators to make enough money out of. That's why flybe use smaller a/c on these routes such as the Q400 which is highly economical and brings in the £££'s, on a totally different scale to easy-ryan but then it is a smaller company.

The likes of easy-ryan do not have the equipment to compete!

Tri:ok:

[beauport potato man]

Barbara Cassani

Very interesting info about the FlyBE board meetings, as i have the minutes to the most recent ones.......

Get rid of all the jets? Doubt it.

Regards

[Martino]

As a founder of one of Europe's largest budget airlines directories (low-costs, charters, etc.), I found this discussion really interesting. In my opinion, flyBE is nowhere near bankruptcy. These guys are innovative and flexible and have been changing their marketing strategy with time. They might eventually remove themselves from the low cost market, but they'll just move into something else.

Martino
www.whichbudget.com (http://www.whichbudget.com)

[TwinAisle]

What an interesting thread this is turning into!

Just to clarify a few thoughts tho.... I don't think I, or indeed anyone else, implied that flybe were on the brink of death. They seem to be, as stated, a well run, niche operator, flying some interesting, and seemingly viable, routes.

My point still remains tho.

The two largest players in the market (RYR and EZY) are piling on capacity like there is no tomorrow. They have to find somewhere to fly these seats;

There are only so many "rich" city pairs in the UK and Europe. As I said, some of these pairs looked odd when they started, but they are doing very well; however, there actually is a finite number of both viable city pairs and pax;

If you are building capacity and are maxed out on your existing city pairs (can you really see bmibaby doing a FOURTH daily rotation CWL-EDI for example?) - then you will have to start looking around for other city pairs - and if you find a pair which is lowish capacity, and you can undercut on price, it will be VERY tempting. Into this bracket has to go the routes of:

1. flybe
2. Air SouthWest
3. Air Wales
4. Eastern
5. well - you get the gist

No-one is singling out flybe, I don't think. It's just that they are big, expanding, high-profile, and, like it or not, liable to be squeezed by the ambitious growth plans of some of the other lo-cos.

Beware looking solely at loads, people..... load is almost irrelevant compared to total revenue and yield! Yes, flybe may be at 80% on a 146 to ALC, which translates as perhaps 50% ona 737.... but if the opcosts of the 737 are lower per ASK, then you may find that running the 737 makes more sense, even with the same number of pax!

TA

[Martino]

"... liable to be squeezed by the ambitious growth plans of some of the other lo-cos" ... or "eaten by", as was the case with Go and Buzz!

Martino
www.whichbudget.com (http://www.whichbudget.com)

[TwinAisle]

Martino has a point, that I confess to have omitted...!!

Having said that, easy still seems to have indigestion from Go, and Ryan is still (I think) in court over some aspects of its Buzz buy.... would they want to do THAT again, especially with an airline with a strong brand identity and culture as flybe?

TA

[Martino]

EZY or RYR might not be ready for another big takeover, but some of the other European low-costs might see it as an excellent opportunity to expand into the UK (+ France) market. Air Berlin seems to have an eye out on expansion.

Martino
www.whichbudget.com (http://www.whichbudget.com)

[Flightmapping]

Are we forgetting the size of the European market when we talk about saturation? Look how Air France still dominate French domestic routes and see the possibilities there if their stranglehold on CDG & ORY slots can ever be broken.

OK, so Flybe have very limited exposure to operating routes outside the UK, but the economics of a machine like the Q400 opens up many city pairs which a 737 is too big for. If the "rich" city pairs are for argument's sake cities with populations of 1m+, and the "niche" pairs are cities with popluation of less than 1m, then there are always going to be many more niches than rich pairs.

Looking at the UK, most cities in England seem well served relative to their populations, except perhaps Norwich? In Scotland, BAA's handling fees seem to be an obstacle to further growth of routes to mainland Europe, whereas the network of routes from Belfast is at last starting to expand without having to go through London first.

Think of other European cities outside the major capitals and tourist resorts - there still seems to be plenty of opportunity out there.

[TwinAisle]

I didn't actually use the term "rich" in terms of catchment area.... I was thinking more in terms of yield.

TA

[beauport potato man]

Barbara Cassani

you must have access to much better information than me about FlyBE's sale and all Q400 fleet, because all FlyBE staff today received a letter from the boss about the company's situation - stating that the company WILL NOT BE AN ALL Q400 FLEET, and that a new jet is being evaluated and a decision announced at the end of the financial year.

You, of course, know about other dealings at board meetings that i don't. Can you enlighten me so that i can challenge the management?

thanks

[Whispering Giant]

Barbara Cassini,

I am left wondering who you actually are - i have reviewed your post's on here and most them appear to be knocking flybe and forecasting the death of the company, are you a disrgruntled employee or ex employee of the company who is spreading rumours to cause unrest in the aviation community or are you just working for one of it's competitors and doing your best to knock the reputation of this company and trying to bring about it's demise ???
Working for flybe myself i can tell you for a fact that we WILL NOT be a all Q400 fleet and that various jet fleet replacement options are being evaluated at the present time.
Our speciality is to offer low cost city centre to city centre air travel in regional markets where the likes of RYR and EZY are unable to go due to the types of a/c they operate and a suitable replacement for the 146 that can offer the same level's of performance to get into the smaller airfields that we operate too that are nearest to various city center's.
We actually like to operate to the places we say we operate too and not to somewhere 50-60 miles away or even in another country like a certain airline.
I would very much like to know how you know what is discussed in our company board meetings and how you have got that information - as i'm sure that every thing discussed is confidential and would not be released to the likes of yourself.

brgds
W.G

[TwinAisle]

WG

For what it's worth, I would be amazed if "Barbara Cassani" is the great lady herself; I would further be amazed if they knew anything about the internals of flybe. I think someone is either trying to sound more important than they are, or are just trying to stir up a debate/trouble.

Good luck to you all in Exeter.

TA

[loveJet]

This hasnt been added to for a while.

VBird & Snowflake have already gone bust.

Survivors/mergers:

easyJet - they may overtake Ryanair in pax and profit
Ryanair - they will find it more challenging though than EZY to find airports and routes for the 125 B738's, especially during unhedged operations
Bmibaby and Jet2 may merge before either of they fail (or get sold off)
Virgin Express - continue to be propped up over the winter
Flybe- used to think they would go tits up but now changing my mind if they concentrate on regional low fares with DH8-400's.
Germanwings - deep pockets with eurowings
Thomsonfly & HLX, possibly merge in future
Basiq air- will continue but could merge with another
Wizz Air - its expansion and strategic moves seem well thought out, it also has deep pockets/large investors
Volareweb

Complete failures:

EUJet (sorry!)
AirBerlin/Niki (how many times have LCC succeeded in offering rock-bottom fares with full service!? come on guys! - oh and Southampton-Paderborn, what the hell were they thinking?!)
Globespan (enough said) - possibly merge with Jet2 (?)
Air Polonia (wont be able to stand the heat of wizz)
Norwegian.no (i feel it in my bones)
mytravel.lite (enough already)
Iceland express
Helvetic
Flyme
Air Scotland
Windjet
Zoom (is this really a true long-haul low cost?)

Undecided

SkyEurope
Germania express (not Germania)
smart wings

feedback please!!!!!!!!!!!!!!!!!!

Jet

[ALLMCC]

Just spotted this news thread


www.rte.ie/business/2004/1022/ryanair.html


Interesting?

[Powerjet1]

Crazy - but easyjet shares up 15% at the moment to 151p

[MerchantVenturer]

ALLMCC

I have ben watching this in the financial press all week. There have been various rumours as to why the easyJet share price has risen, including the Ryanair one.

This is the latest rumour.

"UK airline Easyjet surges 16% on Icelandic bid report

By Kabir Chibber, CBS Marketwatch.com 11:50:18 AM BST Oct 22, 2004
LONDON (CBS.MW) -- Shares in U.K. low-cost airline Easyjet (EZJ) surged 16 percent in late morning trade as speculation continued on a possible takeover of the airline. The Guardian reported that three Icelandic airline companies - Air Atlanta Icelandic, which owns U.K. low-cost airline Excel Airways, Iceland Express and Icelandair - are close to declaring a 3 percent holding in Easyjet."

[GOLDEN LION]

Watch out the Viking's are coming....

[Powerjet1]

With nearly 90m shares traded today against the usual 7m/9m daily, someone is definately doing the rounds.

[SOU-Bloke]

>AirBerlin/Niki (how many times have LCC succeeded in offering
>rock-bottom fares with full service!? come on guys! - oh and
>Southampton-Paderborn, what the hell were they thinking?!)

There is a fair amount of demand for this route because of the service personnel and families who are based in the Salisbury/Andover areas and who currently have to travel to Stansted to get to the Military bases in that part of Germany.

I don't what booked loads are like yet, but from what I've heard they're not too bad. Time will tell.

[terrier21]

The Vikings again!!!

Never mind just locking up your daughters put them in to long term storage!!!

[loveJet]

SOU-BLOKE

Paderborn flights from Southampton won't operate past March 17th Im afraid.

Jet

[Scottie]

RE: Flyglobespan

I currently work for the Orange Mob at a Scottish base but have used Globespan once. Great service providing a great product.

Allocated seating - I love it.

Onboard service - same as easy :ok:

I think they'll do really well and don't underestimate Tom Dalrymple. If they paid a bit more & offered a pension I'd leave easyJet tomorrow.

easyJet have missed the boat with GLA/EDI. While airlines are banging on the door trying to get slots at both airports BAA are not going to reduce their fees for easyJet. So we'll mirror image BA for the foreseeable future.

Even with direct services from GLA/EDI I'd fly Globespan with allocated seating everytime. Don't like an undignified scrum when I'm going on holiday.....

[Nearly Man]

Hmm, Scottie .. you getting bored with Sleazy?

[ATNotts]

LoveJet

Can't agree with your analysis that Air Berlin is going to fail in the LCC bloodbath.

AB & Niki are the market leaders in the German leisure market, and their Mallorca Shuttle, which is essentially the template for the City Shuttle was operating long before the term LCC was coined.

The German market isn't driven solely by price, Germans still look for quality and AB's honest pricing (all taxes included in the headline fare) and decent cabin service still counts for something.

I travel with them frequently between UK and Germany, and there is no comparison between their service and that of some of the UK and Irish competitors.

SOUTHAMPTON-PADERBORN

This route isn't necessarily ending on 17 March. In fact all the City Shuttle routes are not presently bookable beyond this date.

[loveJet]

AIR BERLIN/NIKI

I agree that quality service counts for something on a LCC, the only problem is that it jacks up cost, and when fuel is rising and competition from other LCC without the frills is intensifying there is one logical conclusion: It isn't long sustainable. You must agree?

SOU-PAD. All other Stansted and Manchester City Shuttle (try saying that drunk and fast) routes are on sale after March through to September 2005 apart from this one. Fares are still very low on the web, must mean one thing!?

Jet

[codpiece face]

What has not been mentioned about the icelandair buy in at easy jet is that it will be easier for them to prevent easyjet starting an icelandic service and so protecting their own interests whilst at the same time investing money. Now who is the smart one !!!.

It is very interesting to read this thread from start to finish as it has been running for a few months now, to see what developments have happened. The biggest in this regard being the 737's by flybe, read the thread and tell me who honestly saw that coming.

The next few months are when the heat will be turned up by the big boys and after christmas when the cash flow is lowest i would imagine some movements on mergers/take overs and bankruptcy.

[Robert Vesco]

loveJet: Survivors/mergers:

easyJet - they may overtake Ryanair in pax and profit
Ryanair - they will find it more challenging though than EZY to find airports and routes for the 125 B738's, especially during unhedged operations
Bmibaby and Jet2 may merge before either of they fail (or get sold off)
Virgin Express - continue to be propped up over the winter
Flybe- used to think they would go tits up but now changing my mind if they concentrate on regional low fares with DH8-400's.
Germanwings - deep pockets with eurowings
Thomsonfly & HLX, possibly merge in future
Basiq air- will continue but could merge with another
Wizz Air - its expansion and strategic moves seem well thought out, it also has deep pockets/large investors
Volareweb I heard that Volareweb isn´t doing too well these days... :ugh:

[ATNotts]

LoveJet

I'm by no means convinced of the early demise of AB. They have in Joachim Hunold a pretty shrewd businessman as CEO, and the tie up with NIKI, along with the new codeshare with Hapag Lloyd seems to suggest they have their eyes on the ball.

I would say a more likely scenario than AB going down, would be for them to pick up the remnants of some of the other German LCCs - notably GEXX whose network seems very fragmented. Time alone will tell.

SOU-PAD. When last I booked STN-NUE, a week or so ago, City Shuttle was not on sale anywhere beyond 17 March. As you say, the future doesn't look so good for this one route now, in light of the release of the rest of the UK program, including, I see, a return to a daily STN-PMI for the Summer.

[FLYboh]

Looks like the battle has commenced. This is from the Flybe website.


Air Price War: Flybe. says "Bring it on"
27th October 2004
FlyBE., Europe’s 3rd largest low cost airline, and the largest carrier at Belfast City Airport, has announced its lowest ever fares on services to London Gatwick, Bristol, Edinburgh, Glasgow, Newcastle and Liverpool.

Effective immediately, the lowest one-way fare on the six routes including all tax and charges will be £9.99.

Mike Rutter, FlyBE. Marketing & Sales Director, says: “It is no secret that Easyjet has initiated a fares promotion on all routes where we compete head-to-head. They are obviously feeling pressure on these routes as a result of our ever-increasing market share and the overwhelming success of our recently launched Belfast City Airport to Liverpool route. We should emphasise that unlike Easyjet, our fares promotion also includes London Gatwick, an extremely important connection for Northern Ireland.”

“We maintain that competition in the market is very healthy and excellent news for the travelling public.

“But unlike other airlines, we guarantee a great deal more added value. FlyBE. is the most punctual airline on these six routes. We offer pre-assigned seating, a flexible business product, including executive lounge access, 30 minutes less drive-time to the centre of Belfast and a check-in time 50% less than Easyjet, with the added advantage of check-in at the ticket desk for passengers carrying only hand luggage.

“We are confident that these fares at £9.99, combined with all the added extras is an unbeatable mix.

“FlyBE. is now providing 11 direct services from Belfast City Airport giving comprehensive connections throughout the UK.

“Our prices are the most competitive they have ever been and ticket sales show the travelling public likes what’s on offer.

“We know that the NI Consumer want low fares and quality service and they already know the best way to guarantee this is to choose to fly with FlyBE., as they are already doing in droves.!”

[CaptJ]

Just the usual Flybe Bull.

Flybe hold the record for the single most expensive domestic flight that I have ever made. (£305 BTW) yet they get away with claiming that they were the original low fares airline.
the other porker they continually claim that there is 30 mins difference in travel time between BHD and BFS. If I can travel from Belfast to BFS in 25 minutes no sweat then they must be travelling via Ballymena!

ALSO, how come taxes are charges from BHD to LGW are now only £9.95 each way having ripped us off for £38 return before!

call in the ASA I say.

And as proof of the pudding that they are all mouth and no trousers, here are quotes for a trip to Gatwick I was considering making next month. (24/25Nov)
FLYBE £131.55
easyJet £45.98

I suppose you'd pay the extra £85 for the privilege of being forced to check in you bag :E

[ALLMCC]

No doubt prompted by this even bigger load of bull!!

www.easyjet.com/EN/News/20041026_01.html

[CaptJ]

perhaps

perhaps not, where is the catch?

What is conspicuous by its absence is any king of price guarantee from FlyBe:hmm:

[stagn8]

This thread is very interesting. Some questions spring to mind..

(a) where you have big capacity, why not do what they do in Asia and operate a 747-400 on a short sector, filled to the gills with pax, twice a day ? (eg HKG/MNL). this must be an efficient way to attract the price sensitive customer...

In the US (where I now live) the reverse is true and more and more CRJ type flights are filling the skies where 737's and 727's once plod. Frequency is one thing, price is another ? Which segment of which market represents the future growth ? Many LCC's have created new markets, instead of going to the pub or to the theatre you can now go to PRG for the evening... Maybe these airlines will focus on different market segments?

(b) Whose passengers are they anyway ? The airports or the airlines ? Or maybe the travel agents ? Does your average joe punter care which airline they fly on ? Maybe the airport or handling agent will run the booking engine and buy capacity just ahead of the flight from aircraft operators who can bid for the business on an ad-hoc basis, after all you don't get to see the airline or airplane these days in most cases until you step off the jetway (or climb up the steps)... maybe the future of the brand lies with the catchment area...

c) Interlining. This is what people pay money for in the full service airlines. LCC's generally do point to point only. I think the next very rich person will be the one who develops e-interlining for low cost carriers, maybe Mr Ambrose and the ERA?

d) As to the point of this thread, who will survive ? Easyjet looks most like Southwest, the grand-daddy of them all. But Southwest has a unique feature I don't see in Europe in that it operates a sprawling network that allows pax to be shunted from one hub to another to get from a to b, more like a coaster service than a ferry service....

good luck and success to them all !!

[Cyrano]

Stagn8:

c) Interlining. This is what people pay money for in the full service airlines. LCC's generally do point to point only. I think the next very rich person will be the one who develops e-interlining for low cost carriers, maybe Mr Ambrose and the ERA?

Check out www.openjet.com, who basically offer this service (for a half-dozen or so carriers including easyjet but not including Ryanair or flyBE) and also sell you insurance in case you miss your "connecting" low cost flight. I don't think they're very rich yet, though. ;)

CaptJ:

When airlines break out the taxes and charges, they usually based them on the published landing-fee tariff, not the deal they have. Thus the £38 you paid before may well have been based on the published BHD and LGW tariffs, but the airline wouldn't actually have been paying the airport operators anything like those levels. It's another way for an airline to pretend that they're charging you half nothing and that it's the greedy airports who are responsible for the costs - in fact the airline is typically pocketing a good chunk of the supposed "charges". But then competition comes along and flyBE can no longer get away with supposed £38 charges compared with the much lower charge base easyjet has at BFS... :)

[Edited to fix openjet URL]

[Trislander]

Hey Captain J,

Don't forget that the way the low cost models work is that as the a/c fills up, seats get more expensive, especially if you book just a month in advance. Most offers you have to book at least a couple of months in advance.

It looks from your above example of pricing that the flybe a/c are filling up fast while there are many easyTat seats left empty :ooh:

[CaptJ]

Trislander,

"filling up fast" my arse. The last return trip I made with Flybe the flights were half full. the last 4 return trips I flew easyJet I was "Sequence No" 145 or HIGHER. The truth of the matter is very simple, Flybe offer relatively cheap flights and some flights have no cheapies.

Lets just be clear about one thing. All my flights either come out of my own pocket or a very meagre departmental budget. I will always go for the cheapest, taking into account incidental extra costs. Its very, very infrequently I get anything close to the easyjet price out of FlyBe. It does happen, but not very often. I quite like the little Q300/400s, hate the 146s.
And just one other little point - I'm not a very demanding passenger, but I really can't fault the overall experience with easyJet in recent times. When GO was around I avoided easyJet like the plague and there were no cheap fares form the saviour of BHD then either.

It sometimes makes me feel guilty when I fly bmi or FlyBe, because without easyjet/GO and a much lesser extent Ryanair we would still be being ripped off for travel in a country where we have no choice but to fly.

I've been flying from BFS/BHD for 26 years now, so if you want a litany of horror stories you can have them. easyJet hardly figures there at all.

EasyJet's business model requires low fares to fill the planes. FlyBe only offers cheap flights when there is competition. there are routes with and without competion for you to compare. GO flights to STN did not go up in price when Flybe, then British European pulled out for example. Flybe flights to Birmingham shot up after Maersk pulled out and again after MyTravel Lite pulled out.

Remember too that easyjet is a public company whose facts and figures are available for all to see. Same does not apply to FlyBe or bmi.

rant over

[The_Bean_Counter]

Thought it was worthwhile resurrecting this one seeing as Volare have gone, whos next then ?

[eoinok]

Going from recent personal experience and personal observations (like 3 span new Airbus parked up in BUD for the day for example), WIZZAIR would be the favourite in my book....

[colegate]

My list of high risk airlines would include EUJet (with seemingly hopeless loads on all routes except Malaga), Air Andalucia, which appears dead before it has even hit the starting grid. Even if they had started Ryanair's plans to go into Granada would have killed them. Ihave always been doubtful about Wizzair. You cannot replace a viable business plan with a colour scheme however jazzy. They seem to have extreme over-capacity already and are very vulnreable to EasyJet competition in particular. I do not see any long term future for Jet2. But Meeson is a very canny character and it is my guess that he is plumping the beast for sale to Easy. Their operations would complement Easy very nicely. Congratulations Phillip you seem to have a profit making strategy at least for yourself. I think you will win it. My Travel Lite have effectively gone already. Flybe does not appear to have any strategy other than trying to imitate the Gadarene swine. They seem to hurtling towards the cliff at a frightening rate. Kidding themselves that they have made a profit when in reality they seem to be losing money is a fundamental problem. Expanding when you ought to be consolidating is exactly the sort of mistake that Laker made. I cannot divine the strategy of bmi baby. I think it telling that Tony Davis left just when they had announced their largest expansion ever. The animals leaving a sinking ship or maybe just deciding what ashtrays they are going to buy for the next voyage? And there are still another fifty or so so-called low cosr airlines out there, most of them seriously undercapitalised. In the meantime RYR, EZY, AB are getting stronger every day. New entrants beware. It is getting tougher every day.

But I do think that TOM will succeed. HLX probably will too. But what are Thomas Cook going to do? Some of their core business is being removed from them before their very eyes and they still have not made any response.

[Doug the Head]

Air Polonia (http://www.airpolonia.com/kup_bilet.php?lang=en) just made the following announcement:

Dear Passengers,

We regret to inform you that from Sunday 5 December 2004, all our flights are suspended and tickets are not on sale at the moment. We inform you that SkyEurope Airlines has agreed to carry our passengers for free (excluding airport taxes and charges) on its network. You may use this option by rebooking on www.skyeurope.com.

Another one bites the dust...

[carlos vandango]

much as I hope it doesn't happen, I fear EUjet may fall off the edge of the world. In Europe I suspect Wizz may not last the pace, although apparently they got extra funding recently. As for Easy buying JET2..not so sure. Easy have had enough pain in the past with clapped out tractors..why buy another bunch of them?

[HOODED]

For access to their routes.They could always get rid of the clapped out tractors. Having said that I have to say I've flown on a few and they're well maintained and reliable so why get rid?

[Doug the Head]

For access to their routes.They could always get rid of the clapped out tractors. Good point HOODED. Hell, EZY has so many Scarebusses up for delivery that it would be good to have those extra routes, but I doubt if EZY would want to spend the money on any take over. With a long winter ahead and Ryanair expanding on their turf (LTN and LPL) they might need the cash for other purposes. :ooh:

[14 loop]

Would PM really want to sell the Jet2 bit of Dart Group? LS has become the predominant part of the aircraft operation side with the demise of the F27s and the growth of his squadron of 737s.

A look a Dart Group's share price for this year, a low of 121p ish to something along the lines of 345p shows that despite all those 'doubting Thomas's' that regularly posted on PPRuNe that Jet2 @ LBA would not work, have been proved wrong. A quick squint at their loads from LBA and they are making some serious money. On share price alone, PM if he was minded to sell ought to do now.

The aggressive expansion at MAN will drain resources and send the share price down. I get the feeling PM is looking at the long-term. The next set of route announcements will certainly be of interest and might be being timed specifically for effect.

[POL1W]

I could'nt agree more. The fortune they must have made at LBA will be wiped out at a stroke with a loss making MAN operation. All their recently announced routes from MAN are already covered, sometimes by several operators, and nearby at LPL. If the rumour of Easyjet at MAN becomes reality, then I think Jet 2 will find they have bitten of more than they can chew. EZY is a household name, Jet 2 is not. Therefore the average person will immediately look for flights with EZY before thinking of Jet 2. The charmed life they have had at LBA, creaming of all the loco work with virtually no opposition, and the profits to go with it, will not look as good in next years report to shareholders. There was and still is serious money to be made at LBA, and Jet 2 should remember this before any further money wasting plans are put into operation at MAN, otherwise someone else just may commence ops at LBA and blow them right out of the water.

[Curious Pax]

Not sure about the statement regarding Jet2 not being a household name - in the South Manchester/North Cheshire area they seem to have ads on billboards and the side of nearly every bus for miles!

[orangetree]

I think there is a misconception out there that Easyjet somehow don't know what to do with it's 120 airbuses. There are plenty of uses for them..but the logistics of hiring/ retraining more crews tends to slow the process down. Should the company wish to reduce its expansion targets, they can use the buses to roll over the UK fleet a little earlier. I really can't see Easy buying out any other LCC in the current market conditions. Although Jet2 has a robust operation at LBA..it's still surrounded by orange bases within 1-1.5 hours drive and in any case the Esteemed Leader reckons that all new roads point at the former eastern block.

[GOLF-INDIA BRAVO]

I think Jet2 is going to do very well out of Manchester as people I speak to not wish to travel to Liverpool anymore because they can travel locally loco from Manchester,
Their advertising has been second to none
and seems to be very well known even though they have only been operating 6 days out of Manchester

There is room for most of the locos as long as they don`t all go for the same routes
Good luck to them all and lets stop wishing airlines to fail

Golf India Bravo

[unwiseowl]

I heard a rumour that Monarch Scheduled are less than pleased about Jet2 moving in on their Manchester patch. Revenge will be in the form of a Monarch Scheduled base in LBA, allegedly.

[LBA]

Now that would be a turn up for the books!

Even though I am an LBA local, I wish Jet2 all the best from MAN, just hope they dont forget LBA. Allegedley new Jet2 routes from LBA are going to be announced once the ThomsonFly routes are announced out of Doncaster. Jet2s second birthday on Saturday, maybe could happen then?

I agree about the advertising BTW, seems impossible to get away from in the Yorkshire and Manchester area, they are even all over Liverpool!

[Doug the Head]

I think there is a misconception out there that Easyjet somehow don't know what to do with it's 120 airbuses. There are plenty of uses for them..but the logistics of hiring/ retraining more crews tends to slow the process down. I tend to disagree with you on that one. Expanding plus retraining and at the same time competing in today´s cut throat market will just burn money and needlessly eat into the cash reserve. Hence you see the Airbusses replacing the 737-300´s in STN and 737-700´s in ORY, instead of being used to open up new routes.

[Hudson Bay]

Fact. If you can fly from Manchester for a similar price as flying out of Liverpool the punters will travel from Manchester every time. Liverpool Airport is a pain in the **** to get to and when you do arrive there is nothing there. Manchester Airport is a day out for people with loads of cafes and shops. John Lennon Airport sadly lacks alot.

PPP

Hudson Bay - Your post has been edited because you have chosen to make your opinion of LPL known and then followed it up with a rather stupid and pointless remark about Liverpool and Liverpudlians. Fair comment is always appreciated but please keep your prejudices to yourself. Thanks, Blue Eagle, Moderator.

[10002level]

Hudson Bay,

You obviously haven't been to LPL in recent years, so why waste space with untrue comments?

[orangetree]

Yes Doug, but in the middle of the STN rollover will be another Eastern European base full of airbuses and plans for more in existing euro bases and probably another new base after that. Until recently BFS was in line for buses but got dumped in favour of a new base (still tba). I think you have a point about how costly this can be but if they were in the mood for rationalising then outstations such as GLA, EDI, NCL, EMA would be rolled over next year. Really don't see that happening.

[Firm Touchdown]

QUOTE:

Expanding plus retraining and at the same time competing in today´s cut throat market will just burn money and needlessly eat into the cash reserve.

I think you will find that much of the conversion training is provided by Airbus as part of the deal for the aircraft order.

[Doug the Head]

I think you will find that much of the conversion training is provided by Airbus as part of the deal for the aircraft order. From what I´ve heard through the grapevines, most of the Airbus ´freebie´ cources have been used up by now.

[unwiseowl]

I think the deal was that Airbus will pay for all training?

[Scottie]

Nobody knows what the deal was as it's a secret!

Doug the Head makes a good point. By placing the Airbus in STN and other 737 bases expansion is reduced.

Mind you with 40 Airbus coming next year they're going to have to put them somewhere. I'd heard BFS too.

[orangetree]

I heard that that '40' figure had been somewhat reduced..not sure if the deal allows for that though.

[Nil further]

Doug

Suggest you read the EZY,s annual report .All the fleet retirements and expansion are there in the public domain.

"eating in to cash reserve" the annual report states cash reserves of £512 million at Sept 2004 v £360 mill last year.

Heres a bit of the fleet stuff
A319 B737-7 B737-3

Sept 2003 1 27 46
Sept 2004 21 33 38
Sept 2005 55 32 21
Sept 2006 86 32 8
Sept 2007 117 32 0



Cheers

edited as i cant make the columns line up !
sorry.
NF