FOXTROTS*

 

Double WYSKs. What’s working, what’s not – airlines in Asia Pacific, Europe.

WYSK = What You Should Know.

 

Asia Pacific Q1

Our summary of traffic results for the leading airlines in Asia Pacific, excerpts from the current editions of the Travel Business Analyst newsletter, over January-March.

 

Seat sales at biggest FSAs (full-service-airlines) in Asia Pacific (whole-group results for all), in alphabetical order: Air China +8%; Cathay +3%; China Eastern +8%; China Southern +10%; Japan +2%; Singapore +5%.

 

Notes (on notable details):

 

Air China. International still growing faster than domestic, +11%. AC has usually been slower than its two control-freer rivals, China Eastern and Southern. Times are changing?

 

Cathay. That’s the two airlines. Which one is doing badly? What needs to change? Why do investors let the company get away with this deception?

 

Cathay says it wants to match the no-frills-airlines challenge without creating an NFA – a modernised version of its old phrase “intelligent misuse of our B747s”. That would mean low-low no-options fares and no-frills service in the same cabin. This won’t work. One passenger would say “I paid $1000 for this seat, and my neighbour paid $200 just for missing the dinner” – even if not completely true. And then the $200 passenger will demand a wine, because his $1000 neighbour got one. And so on. The Cathay Group has already made a mistake with having two airlines with the same level of service, just different routes. As at the Singapore Airlines Group (Silk folding into SIA) Cathay will eventually fold CDragon into CPacific. But, better, it should convert CDragon what we call a low-cost-airline, and create another airline as an NFA.

 

China Eastern. Rarely do CE’s figures match with the period one-year-earlier. Unusual in that international is slower than domestic.

 

China Southern. The biggest, and the fastest, of China’s top-3. And international is growing faster.

 

Japan. International growing twice as fast.

 

Singapore. Parent airline just +1%. Its NFA division, Scoot, +12%, taking it to half the size of SIA itself.

 

 

Europe Q1

Our summary of traffic results for the leading airlines (not, where relevant, airline groups) in Europe, excerpts from the current editions of the Travel Business Analyst newsletter, over January-March.

 

Seat sales (RPKs for British; our estimates for Ryan), in alphabetical order: Air France+KLM (from this year, no longer separated) +4%; British +2%; Easyjet +5%; Lufthansa +8%; Ryanair +6%.

 

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

 

Air France. Group +5%, which looks good, although we believe AF itself is well below that – +2-3%, with KLM possibly around +8%, and Transavia +14%. Transavia has an impressive seat factor – 94% for the month, 92% YTD.

 

-British (=ICAG). British is still the weak partner; Iberia, the group’s other FSA (full-service-airline), is at +8%. ICAG’s two NFAs (no-frills-airlines) are doing well – our estimates, AerLingus +13%, Vueling +18%.

 

Easyjet. Signs of concern? YTD at +5%, but March at +3% – is that the lowest-seen for an NFA in Europe?

 

Lufthansa is the region’s star performer; +13% and even +15% in March. But most of that is Eurowings; +41% YTD, +46% March. As we have noted before, EW is already bigger than most of other airlines in the group such as Austrian and Brussels. And now it has overtaken Swiss to become 2nd-largest. Its capacity is now about-20% the size of mighty Lufthansa.

 

Ryanair. Slowing growth, but seat factor 94%, squeezed up 1pt.

 

Others of note: Wizz, which gets fawning press coverage, is doing well, +24%. And growing faster than that fading-fawnee, Norwegian, +12%. By mid-year Wizz should overtake Norwegian in seats sold.

 

 

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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