VEX to merge with SN?

[LUM]

From La Libre: "Difficult to say, things being still very moving, some evoking even a possible dead end. In-house at Virgin Express, one in any case puts certain questions about the African SN strategy Brussels Airlines - considered to be too ambitious compared to the means available - but also about the choice of the Hasson/Gutelman tandem like partner. But it will be finally to Richard Branson - who still did not pour the 25 million promised euros with SN Brussels Airlines! - to decide. And with him only!". .The final decision is awaited today.

[sabenapilot]

Seems the idea of a merger is no longer a must from SN side as can be deducted from the way in which they set out their stategy without taking to VEX (new name, livery, fleet, routes,...).. .We all knew a possible merger would never really be out of 'love', yet now it seems SN thinks they are able to survive on their own as they are currently doing better then expected at this early stage. (load factor stayed above 50% for the whole last week for instance). With this in mind they may expect to break even in August already.

Still I think that in the end they will work together, but then not as 2 equal carriers going together as VEX hoped for for a long time, but as one carrier (SN) taking over the other (VEX)...

[Flying_Tuur]

I have the same Idea as you Sabenapilot: Sir Richard Branson was planning something like a 'hostile takeover' to expand his own carrier in Brussels. With the excellent start-up results for SN, SN is no longer in a weak position, especially after the start-up of their African network.. .In my opinion SN should continue some codesharing with VEX on some destinations, but NEVER on the LHR route as SN has done.. All the aircraft to LHR can be filled by SN on their own, with te high quality a SN pax expects to get. SN has to be very carefull not to make the same mistake as Sabena did, to put high yield pax in a Virgin aircraft with a Virgin coke and a rubber sandwich (if not peanuts).. .The only thing that prevents a possible successtory (finally) in Brussels is the partnership with one (North) American and one Asiatic partner. SN may not have the ambition to be known worldwide, but has to have the ambition to be a very strong Euro-African player.. .And for VEX, well let them go in competition with Ryanair, easyJet and Go, since that's the market they are playing on...

[sabenapilot]

You're absolutely right Flying_Tuur,

SN must focus on becomming a higly reputated carrier for Europe and Africa only! Apart from the basic "Brussels aspect" so to say, they have to become a synonym for flights to Central Africa once again, just as TAP/Iberia would be a natural choice if you wanted to go to South America.

SN needs a strong European network because it's important for Belgium to have good medium haul connections and besides, with EU, NATO and more HQs then any other city in Europe I don't see why there wouldn't be room for a medium sized Brussels based airline focussing mainly on European business pax.

Africa because SN was traditionally one of the 2 strong players on this continent. Beside, now that Air Afrique is out of business, it would be a pitty to let this very profitable niche market over to Air France. This lucrative intercontinental branche would also give SN the change to strenghten its European network through feeder flights and would make the company less dependant from the generally low-yield European market. Note that these feeder flights would not have to be offered for virtually free as Sn had to do in the past, since the onward flights to Africa have a much higher yield then onward flights to the USA or Asia for instance.

With this route structure SN has everything it takes to get 2 good intercontinental partners in the USA and Asia, which could be very interested in SN's European network + its African market. American airlines and any Asian partner with good connections in the Pacific region would make perfect alliance parnters.

I think the management at SN is on the right track now that the Swiss and their silly ideas about a strong global network are gone.. .There's nothing wrong with being a nice medium sized intercontinental flag carrier like TAP, CSA, Icelandair etc... it might even be easier to get stable and profitable results that way!

[Belgian Sadness]

According to Financieel Economische Tijd: They stopped talking. Commercial coöperation remains...

[Belgian Beauty]

Have just heard on the radio this morning that SN Brussels airlines and Virgin will definately not be merging.

[janpieter]

In a company statement, Virgin says the decision to end the merger talks was mutual after both companies decided it is not in their interests on financial and cultural grounds.

The official decision came a few days after Sir Richard Branson negotiated with Etienne Davignon, one of the Belgian bankers who raised the capital to launch SN Brussels Airlines from Sabena's ashes.

"After two months of detailed discussions, both companies have decided that it is not in their mutual interests to merge, both on financial and cultural grounds," the Virgin Express statement said.

Brussels-based Virgin Express has been successful in the low-fare end on the market while SN Brussels wants to centre its strategy on the business traveller.

The two airlines started talks in December and had said then that they wanted to finalise a deal by the end of February because they wanted the new airline to be fully operational by the summer season.

The airline emphasised that it still expects to show a breakeven operating result for the full year 2001.

It expects a profitable second quarter in 2002 following the first quarter's usual seasonal loss.

The Belgian airline has 6,000 employees and flies to 35 destinations. Virgin Express, a budget carrier, has 800 staff and flies to 14 cities. It has been a money-loser in recent years.

[Flying_Tuur]

Since when has DAT (I know, it's SN Brussels Air....) 6000 employees? I guess less then 2000.. .You probably mess up figures: After the Sabena bankruptcy about 6000 people of the group kept their job, but they were divided at Sobelair, DAT, ground handling, ...

However, I believe it's a good thing SN did not merge with Virgin. Virgin says it had an increase of pax the last months, but that was only because they had little or no alternative out of Brussels. SN will give the high yield pax wath they want: a good service where they want to pay that little extra for.

PS: Is Virgin Express capable of CATIII approaches?

[Filip146]

In REPLY To CAT3 question...... .Real story:. .In the beginning of the DAT operations (november 2001), there were no code-share flights between DAT and VEX. So, both airlines operated flights to e.g. LHR at the same times. I was F/O one a DAT flight one morning on a flight LHR-BRU. We took off just after the VEX to BRU. BRU METAR: vis 050 RVR25L :175. We did a CAT3B approach and landed, as well as the other DAT flights. . .The VEX ended up in Ostend as well as many other airlines. Charleroi/Brussels South was bad as well, so RYANAIR would also have been a very bad choice to fly with that day..... . .Anyway, SN Brussels Airlines AVRO RJ Fleet are approved for CAT3B RVR 150 at BRU. . . :) :) :) . .If VEX is CAT3, I don't knwow, but my guess is NO.

[FL310]

Filip...this is a COMPANY INTERNAL CAT 3 B thingy...ICAO wise this is still CAT 3 A

If you read your FOM you will find that CAT 3 A is granted after the checkflight and that you can go below the 200 mtrs after some time AND if lower minimas are granted.

[wardeep]

Well Filip146. .VEX is certainly CAT3 with the exception of 1 aircraft.