FOXTROTS*

What worked; what didn’t. Airlines in Europe in 2017

An excerpt from our monthly Travel Business Analyst newsletter.

 

Our summary of traffic results for the leading airlines (not airline groups, where relevant) in Europe, over January-December. Seat sales (RPKs for British; our estimates for Ryan): Air France+Hop +3%; British +1%; Easyjet +10%; Lufthansa +6%; Ryanair +10%.

 

Notes (on notable details; on whole-group for Air France, British (=ICAG), Lufthansa):

 

-Air France. KLM’s +8% is about best among Europe’s biggest (above 30k seat sales). We thought Transavia would bring constant good news, but growth has been seriously slowing in recent months. Its all-year +11% is not good, particularly as it is still a small airline; its 15mn seat sales are only half those of, say, Wizz.

 

Is more effort going to launch Joon (yes, that’s its name)? When will the group follow the Singapore Airlines group and merge its two NFAs (no-frills-airlines)? Two years?

 

 

-British (=ICAG). All the group’s airlines finished the year strongly – except the biggest, British, just +1%! Barcelona-based Vueling had a bad year, +4%, but blame that on the city’s Catalan crisis; seat sales actually fell in two months, and were flat in two others. AerLingus growth is also slowing.

 

As at AF-KL, is ICAG focussing on its new medium-haul NFA (Level; yes, that’s its name)? As we have long forecast, ICAG’s Open Skies (yes; ICAG is good at giving weird names to some of its airlines) is shutting down. And it lost its bid for Niki, a failing Vienna-based NFA that original owner Niki Lauda will now make his third airline loss (Lauda Air, Niki 1, Niki 2). He was good at running F1 racing cars; no good at running airlines.

 

What’s next for ICAG’s rationalisation? Merger into one groupette (names will not be lost) of AerLingus, Level, Vueling?

 

 

-Easyjet. Same growth as Ryan! That’s Ryan’s relative slowdown , not just Easy’s growth; all-2016 was +7% for Easy, +15% Ryan .

 

 

-Lufthansa. All-group sales were +18%; stunning yes? Well no, because the group does not compare like with like; not including its new subsidiary Brussels in 2016, for instance. According to our apples-apples calculations, that +18% is actually a mundane +5%.

 

That said, its Eurowings is growing at super speeds – +28%. It was already bigger than Austrian; now it is also bigger than Swiss. And it is steadily becoming what we call a low-cost-airline (not an NFA), and taking-over or taking-on, routes from the FSAs (full-service-airlines) in the group at a lower cost .

 

 

-Ryanair. See Easy above. Note also that Easy improved its seat factor from 90% to 92%, and Ryan 95% to 96%. Despite the different numbers, these growths are equally impressive; Any growth above about-92% is hard.

 

However, we suspect Ryan finds a way to count everyone so that on some flights the paper seat factor would be above 100%. Indeed, we would not be surprised if it manages to count those from cancelled flights!

 

 

The Fox

Remember, I’m an industry expert in the parallel world.

 

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

 

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