BestWestern
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Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 1:45 am

Sky Europe seems to be cutting some key routes in the face of the onslaught of competition.

These routes go from the start of the summer season

WAW BGY
WAW BTS
WAW SZG
WAW STN

STN BUD also gone from the June
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Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 1:52 am

This is because of their new base in Prague. Other flights affected were Krakow-Bologna, Krakow-Stockholm and Poznan-Amsterdam.

Shame that Sky knew they were not going to fly those routes but up until yesterday they were selling tickets for it.
 
BestWestern
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 2:08 am

Quoting Danny (Reply 1):
This is because of their new base in Prague

No - the new PRG base is simply down to a badly performing Polish market, and a badly performing London market.

The writing on the wall of Sky's WAW base was on the wall for a while....

http://www.airliners.net/discussions...general_aviation/read.main/2476118

http://www.airliners.net/discussions...general_aviation/read.main/2289108
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Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 2:16 am

Polish market is the quickest growing market in the world. And for example tickets for AMS-POZ were selling great. But the base in Prague was established on demand of their new Czech investor. Since they need money to survive they had to make investor happy.
 
Chiguire
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 2:38 am

Quoting Danny (Reply 3):
And for example tickets for AMS-POZ were selling great.

I heard exactly the contrary.

Quoting Danny (Reply 3):
Since they need money to survive they had to make investor happy.

Well, this is for sure.....if you add all the losses they have hosted you come to the conclusion that the money will run out by the end of the year (latest).

But the decission for PRG I think is a good one.

And the official reason why they cut the WAW services is the capacity at the WAW terminal and the high costs there.....
 
BestWestern
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 2:40 am

Quoting Danny (Reply 3):
example tickets for AMS-POZ were selling great

Carriers dont cut profitable routes. Hacking WAW will make marginal costs there even higher.

Quoting Chiguire (Reply 4):
.....if you add all the losses they have hosted you come to the conclusion that the money will run out by the end of the year (latest).

There simply isnt the room for all the low cost carriers in Europe. New Investor or not.
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Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 2:57 am

So why do they cut KRK which seems to be one of their main bases so far?
 
Chiguire
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 3:07 am

Quoting Danny (Reply 6):
So why do they cut KRK which seems to be one of their main bases so far?

Maybe it is their best base. But this does not automatically mean that they can fly everywhere from there. Maybe Bologna and Stockholm didn't perform well.
They start BRU from there and increase other destinations e.g. STN, BGY.
 
Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 3:12 am

These routes were not even started! As I said - the aircraft was moved to PRG and whole rotation of that aircraft was cancelled. Sky says that these routes will not be launched at this time. So they still may start them once they get more aircraft.

But obviously you are right when you say Sky is loosing market to Wizzair. Wizz carried 1,23 mln people from Poland last year while Sky only 470k.

[Edited 2006-02-14 19:14:20]
 
Humberside
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 4:26 am

Is PRG very good teritory for a based LCC? Smartwings havent been doing exceptionally well and seem to be chopping routes more often than adding them and certainly not adding capacity. Do SkyEurope really think they can do much better?
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adamlaskiewicz
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 6:51 am

Quoting BestWestern (Reply 2):
No - the new PRG base is simply down to a badly performing Polish market, and a badly performing London market.

The writing on the wall of Sky's WAW base was on the wall for a while....

As already mentioned, Poland is the world's third fastest developing aviation market after China and India so I wouldn't say the market is "performing badly" especially any route from Poland to London. London has to be the top international destination from Warsaw and indeed from practically every Polish airport. I think it is more a case of SkyEurope performing badly and there being a lot of strong competition.
 
BestWestern
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 6:08 pm

To clarify - A badly performing polish market for Sky Europe. The huge growth in the polish market is partly down to stupidly low fares that are not sustainable. First, Air Polonia and now SkyEurope have reduced capacity in the market. High loads doesnt equal profit.

For me Sky Europe is doing a BmiBaby on route developments - they are all over the place, taking every tactical route over a steady growth concept. For a carrier their size they have way too many bases, the majority without the density to be dominant. They are finding out that this isnt the way towards profitability.

Quoting Adamlaskiewicz (Reply 10):
any route from Poland to London

I understand that yields on LON WAW are so low that only one airline is currently profitable on this route. Sky Europe cutting capacity will help yields.
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Pe@rson
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 10:33 pm

Quoting BestWestern (Reply 11):
For me Sky Europe is doing a BmiBaby on route developments - they are all over the place, taking every tactical route over a steady growth concept. For a carrier their size they have way too many bases, the majority without the density to be dominant.

I agree. What I think what they should have done was to stop and slow down. Choose 1 base with lots of potential. Really develop it. Become extremely well-known. Maximise brand recognition. You'd have a large pool of loyal passengers. You'd be well-known for your existence. You'd have a fort-like ability to defend yourself from attacks. Moreover, you'd be bound to get far better deals which would thus enable you to have lower costs. Additionally, you'd have few problems regarding staff and MX scheduling - unlike if you're everywhere. Then choose another base with lots of potential, ideally to precisely the same places as from your first one (to take advantage of the excellent deals you could get). Develop that. Etc.

[Edited 2006-02-15 14:42:04]
"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
 
cornish
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:06 pm

Quoting Pe@rson (Reply 12):
I agree. What I think what they should have done was to stop and slow down. Choose 1 base with lots of potential. Really develop it. Become extremely well-known. Maximise brand recognition. You'd have a large pool of loyal passengers. You'd be well-known for your existence. You'd have a fort-like ability to defend yourself from attacks. Moreover, you'd be bound to get far better deals which would thus enable you to have lower costs. Additionally, you'd have few problems regarding staff and MX scheduling - unlike if you're everywhere. Then choose another base with lots of potential, ideally to precisely the same places as from your first one (to take advantage of the excellent deals you could get). Develop that. Etc.

Yes and no - I agree with you pretty much, although I'd argue that they needed a second major base VERy early on due to Bratislava being less than ideal to grow on a dramatic scale. There is so much growth there, but not never-ending.

They had to get a second base up quickly somewhere close to a large market with a lack of or weak competition. Budapest wasn't a bad choice given Malev and Wizzair are weak and the city has a very large population and a big catchment area.

That was a good idea - but then as said, it increasingly became a scatter gun approach with aircraft based all over Eastern Europe. - yet their passenger numbers are still rather small so they are clearly spreading themselves too thinly. It can't last.
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
 
Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:19 pm

They are being invaded in their main bases KRK and BTS by Ryanair (in KRK also by other low cost carriers). They lost BUD to Wizzair. They struggle in WAW which they say is too expensive so they picked PRG. Now PRG is very saturated with services to the destinations they picked. Each of their new routes have two or three carriers already.

I don't think they can survive, especially when lease payments for new 737NG start. Perhaps EasyJet could take them over?
 
HBDAN
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:20 pm

Check first Wizzair's breaking news on wizzair.com offering free tickets to SkyEurope's pax, and then SkyEurope's answer on skyeurope.com...

The war between those 2 LCC in eastern europe goes on... and it is stronger than before!

Regards,
HBDAN
Next flight: hopefully soon...
 
Pe@rson
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:24 pm

Quoting Cornish (Reply 13):
although I'd argue that they needed a second major base VERy early on due to Bratislava being less than ideal to grow on a dramatic scale

Then the simple solution would have been to have set-up elsewhere. Yes, a Slovakian airline, but they didn't have to be. WAW or BUD would have offered terrific potential (and still do, to a certain degree) when they first started. They could by now have 10+ aircraft (ideally 733 machines, as they're easy and quite cheap to source) based in WAW and could have a growing BUD base (ideally to the same destinations as from WAW)...

[Edited 2006-02-15 15:26:14]
"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
 
cornish
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:30 pm

Quoting Pe@rson (Reply 16):
Then the simple solution would have been to have set-up elsewhere. Yes, a Slovakian airline, but they didn't have to be. WAW or BUD would have offered terrific potential (and still do, to a certain degree) when they first started. They could by now have 10+ aircraft (ideally 733 machines, as they're easy and quite cheap to source) based in WAW and could have a growing BUD base (ideally to the same destinations as from WAW)...

Well as they were going well before 2004 it wouldn't have been that simple....

only post EU could they start opening bases elsewhere and have free traffic rights within Europe.


And regarding WAW, they certainly would have faced a LOT of opposition from errr LOT (no pun intended) with plenty of govt support....
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RJ100
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:32 pm

They are under pressure, also in BTS. Just booked a daytrip BTS-Bergamo-BTS.

BTS-Bergamo SkyEurope 15 Euros (plus taxes)
Bergamo-BTS Ryanair (0.1 Euro plus taxes)

And this is a relatively short booking (flying in the beginning of April).

Concentration on two or three bases is important now, they should try to establish themselves there first before opening new airports.

Regards,
RJ100
none
 
Pe@rson
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:39 pm

Quoting Cornish (Reply 17):
Well as they were going well before 2004 it wouldn't have been that simple....

only post EU could they start opening bases elsewhere and have free traffic rights within Europe.

I forgot about those countries not being in the EU then. Darn.
"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
 
Beaucaire
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Wed Feb 15, 2006 11:59 pm

The eastblock-countries have been over-rated in terms of potential since quite a while. Air Berlin is hesitating to boost opening new routes to the east since yields are not sufficient to support expensive introduction-campaigns.
There is a market-even a growing one -but traffic-volumes and high-yield business are just not there.
AUA will pay a heavy price sooner or later for their sole focus on the Eastern Europe market.Sky Europe,Wizzair ,Germanwings and Ryanair will eat away market-shares soon.
Budapest ,one of the larger markets in the east,makes about 6 M Passengers /year- about a quarter of Palma de Mallorca.
Prague about 9 M passengers -about the size of Alicante in Spain.
It's not that those destinations will not grow-but the hype is exaggerated.
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BestWestern
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Thu Feb 16, 2006 8:09 pm

Quoting Beaucaire (Reply 20):
It's not that those destinations will not grow-but the hype is exaggerated.

These markets are still relatively poor, which suits low cost carriers. However, there is too much capacity in these markets at present, and airlines are operating at a loss, and will cut further capacity.
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Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Thu Feb 16, 2006 9:04 pm

Quoting BestWestern (Reply 21):
However, there is too much capacity in these markets at present, and airlines are operating at a loss, and will cut further capacity.

I would not generalize like that. Polish market as said earlier experienced tremendous growth and that growth will continue. It will not be that dynamic as last year but definitely will continue to grow.

Although some routes indeed are oversaturated with services especially routes to London. KRK for example has Centralwings, Easyjet, BA and SkyEurope flying to London. Too much. On the other hand there are still airports underserved which have potential for new services.
 
Pe@rson
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Thu Feb 16, 2006 9:16 pm

Quoting Danny (Reply 22):
Although some routes indeed are oversaturated with services especially routes to London. KRK for example has Centralwings, Easyjet, BA and SkyEurope flying to London.

And FR twice-daily to STN with 738 machines.
"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
 
Danny
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Fri Feb 17, 2006 2:05 am

Quoting Pe@rson (Reply 23):
And FR twice-daily to STN with 738 machines.

Sure, forgot to write the most obvious  Smile So 6 daily Krakow-London  drool 
 
LOT767-300ER
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Fri Feb 17, 2006 4:54 am

I agree with Danny on this one.

I think that WAW is a particularly weird situation right now because of expansion there. The airport is not very shall we say "organized" and has high costs. This will of course change later this year with T2 opening.

I think the assault by Centralwings is gaining more steam week by week, and SkyEurope has no doubt been receiving the majority of that fling.

The dominating situation with AUA in Poland, Hungary and rest of Czech Rep is now pretty much gone. LOT has taken that over at the very least, but the LCCs have finished the job off.

Quoting Beaucaire (Reply 20):
Prague about 9 M passengers -about the size of Alicante in Spain.
It's not that those destinations will not grow-but the hype is exaggerated.

Possibly in some countries, but I dont think this is the case in Poland. There are 38 million people and everyone is starting to fly.
 
greenjet
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RE: Sky Europe Struggles In Warsaw, Hacks Schedule

Fri Feb 17, 2006 5:37 am

Quoting LOT767-300ER (Reply 25):
There are 38 million people and everyone is starting to fly.

Very true. Just over 18 months ago there were no flights at all between Ireland and Poland. This summer there will be over 60 per week from DUB to Poland, including EI A321s on DUB-WAW.

Quoting Danny (Reply 3):
And for example tickets for AMS-POZ were selling great.

From what I've heard this route was a shocker in terms of yield.

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