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davidjohnson6
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 1:16 am

Brussels Airlines as a company produces a reasonable quality product, the staff seem competent, and charges prices that are broadly similiar to its competitors. It provides a product which is in demand and which is likely to remain in demand for years to come. Yes, somebody out there might have had a terrible experience but as companies go, it's not a complete outlier compared to its rivals. However, we have an airline that struggles with profitability.

Anyone have any thoughts as to what areas of SN are causing the lack of profits ? Does the company have too many staff ? Are the staff paid significantly more than at other airlines ? Are there certain routes which never make money but are run for "prestige" ? Is the fleet too large ?
 
dstblj52
Posts: 408
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 1:35 am

davidjohnson6 wrote:
Brussels Airlines as a company produces a reasonable quality product, the staff seem competent, and charges prices that are broadly similiar to its competitors. It provides a product which is in demand and which is likely to remain in demand for years to come. Yes, somebody out there might have had a terrible experience but as companies go, it's not a complete outlier compared to its rivals. However, we have an airline that struggles with profitability.

Anyone have any thoughts as to what areas of SN are causing the lack of profits ? Does the company have too many staff ? Are the staff paid significantly more than at other airlines ? Are there certain routes which never make money but are run for "prestige" ? Is the fleet too large ?

The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland faced, their not big O/D markets so they have a higher percentage of connections than other hubs but because there is a lot of competition on going from A to B with a stop their not able to charge more, but their planes have a lower number of people paying the higher price that can be charged flying from A to B with no stops, without enough of those higher yield passengers the flights in total are unprofitable. The Africa market I suspect used to be more profitable before emirates came in and started competing more on what were once expensive flights because while the competition was flying two stops you can charge a premium for one-stop flights now those one stops are standard the pricing has had to come down to match but the costs are lower than industry standard but not so low a primarily connecting hub can work.
 
ADL14
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 1:47 am

SCQ83 wrote:
Jetty wrote:
MrBren wrote:
BRU should be closed and the Belgians should use AMS and CDG instead (both linked with TGV to Brussels).

This would make sense. BRU is at a good location for urban development and probably worth more that way than as an airport. People in Belgium can fly low cost Europe from CRL and all around the world with a short train ride to AMS or CDG.


Lol you must be trolling.

In any case, Brussels is historically a weak (and cheap) real estate market. If Paris real estate market could be, let's say, New York and Amsterdam could be Boston (AMS is small but very expensive), Brussels would be... Cleveland? Nothing fancy or expensive or desirable about it.


That's really low...leave Cleveland out of this!

But I get what you're saying. When thinking of all of the great EU cities, I always forget about Brussels.
 
Blerg
Topic Author
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 5:23 am

According to this link, SN Brussels has until the end of the month to find a solution or file for bankruptcy. One of the biggest problems seems to be the negotiations with the pilot union. Personally, if on Thursday the mess at LH is not resolved, then I don't see what other solutions SN has unless the government takes them over.
Seems like SN doesn't want to cut jobs while the Belgian government wants growth guarantees. Not a good mix for an airline that has been struggling for a while now.

https://www.lecho.be/entreprises/aviati ... 34287.html
 
Blerg
Topic Author
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 5:26 am

dstblj52 wrote:
davidjohnson6 wrote:
Brussels Airlines as a company produces a reasonable quality product, the staff seem competent, and charges prices that are broadly similiar to its competitors. It provides a product which is in demand and which is likely to remain in demand for years to come. Yes, somebody out there might have had a terrible experience but as companies go, it's not a complete outlier compared to its rivals. However, we have an airline that struggles with profitability.

Anyone have any thoughts as to what areas of SN are causing the lack of profits ? Does the company have too many staff ? Are the staff paid significantly more than at other airlines ? Are there certain routes which never make money but are run for "prestige" ? Is the fleet too large ?

The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland faced, their not big O/D markets so they have a higher percentage of connections than other hubs but because there is a lot of competition on going from A to B with a stop their not able to charge more, but their planes have a lower number of people paying the higher price that can be charged flying from A to B with no stops, without enough of those higher yield passengers the flights in total are unprofitable. The Africa market I suspect used to be more profitable before emirates came in and started competing more on what were once expensive flights because while the competition was flying two stops you can charge a premium for one-stop flights now those one stops are standard the pricing has had to come down to match but the costs are lower than industry standard but not so low a primarily connecting hub can work.


I think SN's biggest problem is not only a limited home market but the fact it has to fight for it with LCCs that operate out of CRL. As for Africa, I don't think SN is directly competing with EK on many routes. I think airlines such as Ethiopian, Egyptair, RAM... which all grew in Africa in recent years affected them much more. Now we even have a new entrant, Air Senegal, which is trying to build a transfer hub.
 
oldannyboy
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 9:17 am

Jetty wrote:
oldannyboy wrote:
DDR wrote:
Based on the country size and geography, there is no reason for a Belgium to have a flag carrier. There are enough flights from other carriers to Brussels to satisfy demand. Although I will always miss SABENA.


Really.?.
Same goes for Holland, Luxemburg, Austria, Switzerland, Hungary, Croatia, Slovenia, and even Denmark I would suppose then??. Not to mention weaker economies like Moldova, the Baltics.... Heck even all of Portugal then should be flying on IB via MAD. And whilst we're at it, how about Ireland and EI?? Better have the Irish fly via LHR on BA. And they even have FR after all.

Big difference is that Belgium is right in between the 4 largest hubs in Europe, and Brussels already has a lowcost airport at CRL. BRU had the opportunity to become a major European hub but that ship sailed with the demise of Sabena.


There's really zero logic in what you are saying.
Mere geography without taking into consideration local catchment needs means very little.
How can you expect a city like Brussels to be served by a smallish low-cost airport, or else having people schlepp for hours on trains, coaches and cars to reach hubs that are in other countries?
And having no crystal ball anyone on here, we don't really know what the future might hold for BRU.....
For all we know a less integrated [into LH] SN might be able to provide better and lower cost feed for their intercontinental network...who knows...

As an aside, LH group tried its best to kill SN, treating it like the proverbial rotten apple, when in fact the real rotten apple of the group was always EW. Now that is a real basket case, but because it's a German entity...blah blah blah....well, we all know the usual old story....

Funny how Brussels, Belgium and a perfectly functioning hub&airline get treated over this forum, solely based on the utter incapacity of the LH group to indicate a strategy where " SN would be profitable as a hub airline WITHOUT CREATING COMPETITION to LH's [far too many] already existing hubs"... now, this is the real question here....
 
Blerg
Topic Author
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 9:48 am

What perfectly functioning airline? From what I remember both Sabena and SN Brussels chronically suffered.
 
Jetty
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 11:08 am

oldannyboy wrote:
Jetty wrote:
oldannyboy wrote:

Really.?.
Same goes for Holland, Luxemburg, Austria, Switzerland, Hungary, Croatia, Slovenia, and even Denmark I would suppose then??. Not to mention weaker economies like Moldova, the Baltics.... Heck even all of Portugal then should be flying on IB via MAD. And whilst we're at it, how about Ireland and EI?? Better have the Irish fly via LHR on BA. And they even have FR after all.

Big difference is that Belgium is right in between the 4 largest hubs in Europe, and Brussels already has a lowcost airport at CRL. BRU had the opportunity to become a major European hub but that ship sailed with the demise of Sabena.
There's really zero logic in what you are saying.
Mere geography without taking into consideration local catchment needs means very little.
How can you expect a city like Brussels to be served by a smallish low-cost airport, or else having people schlepp for hours on trains, coaches and cars to reach hubs that are in other

From Brussels CDG and AMS are 1.30 by train, that ain’t hours. And only about an hour extra from Brussels main station than BRU. Local catchment has a big overlap with the main hubs of Europe. Take Antwerp, the second largest city of Belgium: an hour to AMS with many more destinations and frequencies, and 30 minutes to BRU.

Funny how Brussels, Belgium and a perfectly functioning hub&airline get treated over this forum

SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.
 
MIflyer12
Posts: 7778
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 11:44 am

dstblj52 wrote:
davidjohnson6 wrote:
Brussels Airlines as a company produces a reasonable quality product, the staff seem competent, and charges prices that are broadly similiar to its competitors. It provides a product which is in demand and which is likely to remain in demand for years to come. Yes, somebody out there might have had a terrible experience but as companies go, it's not a complete outlier compared to its rivals. However, we have an airline that struggles with profitability.

Anyone have any thoughts as to what areas of SN are causing the lack of profits ? Does the company have too many staff ? Are the staff paid significantly more than at other airlines ? Are there certain routes which never make money but are run for "prestige" ? Is the fleet too large ?

The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland ... [quote]

I see your point - and substantially agree - but I think the Memphis and Cleveland references are low... in O and D traffic. Not every hub in the U.S. is ATL or DFW. There's room in Europe for more than London, Paris, Frankfurt and Amsterdam. (The idea that Brussels O and D should just take a train to CDG or AMS is utterly ridiculous. Lots of cities worldwide support fairly short-duration flights. BRU is no different. )

If BRU can't get a consistent fare premium from its O and D destination set (reference Africa), and has to compete with 1-stops, it needs to focus on cost productivity, and that means wage rates and work rules. Good luck with that.
 
sabenapilot
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 11:56 am

Jetty wrote:
SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.


Ah, the generalisations of the internet...

The airline has been profitable 3 of the last 5 years, despite getting hit extremely hard by a deadly terror attack on its hub, effectively locking it out of BRU for almost a month (a sort of pre-Corona event) in the sping of 2017; it subsequently lost tons of money on a forced and ultimately failed integration project with Eurowings, which made no sense whatsoever and which Lufthansa halted last year after having costed some €200M (you can accredit 1/4th of that bill to SN).

Taking out this apocalyptic exceptionals of the past 5 years, it's a decent airline and with a bit of restructuring it can be set on a more stable footing: what this airline needs most is some stability in the way it is let to operate. If you're constantly being forced by both shareholder and external factors to radically overhaul your operations short notice, it's difficult to demonstrate your full potential through impressive profit numbers.
 
MIflyer12
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 12:02 pm

sabenapilot wrote:
Jetty wrote:
SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.


Ah, the generalisations of the internet...

The airline has been profitable 3 of the last 5 years, despite getting hit extremely hard by a deadly terror attack on its hub, effectively locking it out of BRU for almost a month (a sort of pre-Corona event) in the sping of 2017; it subsequently lost tons of money on a forced and ultimately failed integration project with Eurowings, which made no sense whatsoever and which Lufthansa halted last year after having costed some €200M (you can accredit 1/4th of that bill to SN).

Taking out this apocalyptic exceptionals of the past 5 years, it's a decent airline and with a bit of restructuring it can be set on a more stable footing: what this airline needs most is some stability in the way it is let to operate. If you're constantly being forced by both shareholder and external factors to radically overhaul your operations short notice, it's difficult to demonstrate your full potential.

So, you mean it's been profitable for five years out of 97? :)

Any carrier not making good money over the last eight years given the strength of the market is obviously impaired. LH has run out of patience and has the cover of COVID to walk away.
 
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lightsaber
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 1:19 pm

MIflyer12 wrote:
sabenapilot wrote:
Jetty wrote:
SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.


Ah, the generalisations of the internet...

The airline has been profitable 3 of the last 5 years, despite getting hit extremely hard by a deadly terror attack on its hub, effectively locking it out of BRU for almost a month (a sort of pre-Corona event) in the sping of 2017; it subsequently lost tons of money on a forced and ultimately failed integration project with Eurowings, which made no sense whatsoever and which Lufthansa halted last year after having costed some €200M (you can accredit 1/4th of that bill to SN).

Taking out this apocalyptic exceptionals of the past 5 years, it's a decent airline and with a bit of restructuring it can be set on a more stable footing: what this airline needs most is some stability in the way it is let to operate. If you're constantly being forced by both shareholder and external factors to radically overhaul your operations short notice, it's difficult to demonstrate your full potential.

So, you mean it's been profitable for five years out of 97? :)

Any carrier not making good money over the last eight years given the strength of the market is obviously impaired. LH has run out of patience and has the cover of COVID to walk away.

Agreed. Any losses over the last 8 years are difficult to explain. Were the profits high those 3 profitable years as those were the years to fund 2021, 2022, and into 2023.

I do think the comparison to low O&D US hubs is valid. The US partially rationalized the hubs post mergers. It is time for LH to do so. BRU isn't a strong enough market to maintain the brand. I'm not saying LH group will abandon the airport, I'm saying other brands will likely do the flying.

I would expect BRU to maintain a good fraction of the Africa routes. I would expect Munich to take up the slack.

Lightsaber
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YIMBY
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 1:40 pm

Jetty wrote:
oldannyboy wrote:
Jetty wrote:
Big difference is that Belgium is right in between the 4 largest hubs in Europe, and Brussels already has a lowcost airport at CRL. BRU had the opportunity to become a major European hub but that ship sailed with the demise of Sabena.
There's really zero logic in what you are saying.
Mere geography without taking into consideration local catchment needs means very little.
How can you expect a city like Brussels to be served by a smallish low-cost airport, or else having people schlepp for hours on trains, coaches and cars to reach hubs that are in other

From Brussels CDG and AMS are 1.30 by train, that ain’t hours. And only about an hour extra from Brussels main station than BRU. Local catchment has a big overlap with the main hubs of Europe. Take Antwerp, the second largest city of Belgium: an hour to AMS with many more destinations and frequencies, and 30 minutes to BRU.

Funny how Brussels, Belgium and a perfectly functioning hub&airline get treated over this forum

SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.


There is certainly O&D traffic to Brussels, and the airport is often at the limits of its capacity, as every major European airline flies there. It is also expensive. Compare (pre-COVID) prices from almost any airport, by almost any airline, to BRU and AMS, to find that BRU is significantly more expensive, often >100 €. What is the root cause for that?
 
Jetty
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 1:42 pm

sabenapilot wrote:
Jetty wrote:
SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.


Ah, the generalisations of the internet...

The airline has been profitable 3 of the last 5 years

Yet if you take the total of the last 5 years they are still losing money, and this is true for any period of 5 years of Sabena and Brussels Airlines. Reality is Belgium doesn't care much about aviation and this is what is needed to have a successful flag carrier in a small European country. They sold the airport, have no longterm aviation policy, air traffic controllers like to strike regularly and the airport is even the subject of a fight between some of the many Belgian governments with Brussels imposing high fines on airlines for merely using the airport.
 
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Revelation
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 3:50 pm

ADL14 wrote:
When thinking of all of the great EU cities, I always forget about Brussels.

Prepare for incoming...
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
FlyingElvii
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 4:35 pm

TC957 wrote:
Sabena take two.

Was just thinking that....
Sabina became a jobs and political favors program, Rather than an airline.
 
Coexstud
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Joined: Sun Mar 16, 2008 9:48 pm

Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 4:36 pm

TC957 wrote:
Sabena take two.

Five or 6 actually lol
 
Conti764
Posts: 62
Joined: Tue Dec 11, 2007 2:09 pm

Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 7:43 pm

Jetty wrote:
sabenapilot wrote:
Jetty wrote:
SN was losing money over its lifetime even before the involvement of LH, and on time performance and loadfactors have never been good.


Ah, the generalisations of the internet...

The airline has been profitable 3 of the last 5 years

Yet if you take the total of the last 5 years they are still losing money, and this is true for any period of 5 years of Sabena and Brussels Airlines. Reality is Belgium doesn't care much about aviation and this is what is needed to have a successful flag carrier in a small European country. They sold the airport, have no longterm aviation policy, air traffic controllers like to strike regularly and the airport is even the subject of a fight between some of the many Belgian governments with Brussels imposing high fines on airlines for merely using the airport.


Belgium in a nutshell: a mess.
One can wonder if Belgium will even still excist in, let's say, 3 to 5 years...
 
Conti764
Posts: 62
Joined: Tue Dec 11, 2007 2:09 pm

Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 9:00 pm

Blerg wrote:
What perfectly functioning airline? From what I remember both Sabena and SN Brussels chronically suffered.


SN Brussels Airlines, despite being founded in very stormy conditions, was profitable when it merged with Virgin Express into Brussels Airlines. Brussels Airlines not so much, of course.

But you need to look at the cloudy history of SN as well...

In its second year of operation, the world was hit with the economic crisis. They've had the Western African Ebola outbreak, a devestating terrorist attack on its home base and all this when its owner changed captain twice, each with his own ideas and vision. As a minority stakeholder LH did nothing but keep SN afloat. Not surprising since the financial performance of SN influenced the eventual price LH had to pay for the remaining shares. And after bouncing back up after the March 22 attacks it was forced into a strange construction with Carsten Spohrs pet project Eurowings. Not so easy for a young company, dragging along a history of (political) mismanagement which is so typical for good old Belgium.

And on top of that, other airlines within the LH Group tend to forget about SN when offering options to Brussels or e.g. Africa, they'd rather advertise other Star Alliance airlines or even other airlines outside Star than SN.

And in the meantime the board back in the days made the mistake to set upon on a path of unsustainable growth, stepping into a battle with LCC's which are better at doing so.

Today LH doesn't exactly know what to do with SN. Into Eurowings, back out. Reboot program, Covid-19,... Some here suggest of just letting go and some even think of closing down BRU since Belgians can go to AMS or CDG by train :roll:

In those cases LH would just surrender everything West of Germany on the European mainland to AF/KL. They'd be better off defending at least SN's home turf and also have SN steal whatever revenue they can from AF/KL... The francodutch have destinations, mainly to overseas territories, where they fly at (a near) monopoly. With the right fares SN can undercut AF/KL fares and still make money. It would not bring AF/KL down of course, but there is money to be earned. After all, even with all AF destinations in Africa, SN still flew heaps of pax from France to Brussels to connect to Africa.

And from many places in the Southern Netherlands, getting to BRU is juts as easy or even easier as getting to AMS.
 
dstblj52
Posts: 408
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Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 9:24 pm

MIflyer12 wrote:
dstblj52 wrote:
davidjohnson6 wrote:
Brussels Airlines as a company produces a reasonable quality product, the staff seem competent, and charges prices that are broadly similiar to its competitors. It provides a product which is in demand and which is likely to remain in demand for years to come. Yes, somebody out there might have had a terrible experience but as companies go, it's not a complete outlier compared to its rivals. However, we have an airline that struggles with profitability.

Anyone have any thoughts as to what areas of SN are causing the lack of profits ? Does the company have too many staff ? Are the staff paid significantly more than at other airlines ? Are there certain routes which never make money but are run for "prestige" ? Is the fleet too large ?

The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland ...

I see your point - and substantially agree - but I think the Memphis and Cleveland references are low... in O and D traffic. Not every hub in the U.S. is ATL or DFW. There's room in Europe for more than London, Paris, Frankfurt and Amsterdam. (The idea that Brussels O and D should just take a train to CDG or AMS is utterly ridiculous. Lots of cities worldwide support fairly short-duration flights. BRU is no different. )

If BRU can't get a consistent fare premium from its O and D destination set (reference Africa), and has to compete with 1-stops, it needs to focus on cost productivity, and that means wage rates and work rules. Good luck with that.

I think what needs to happen is that brussel will become more of a focus city where routes that can be filled with profitable fares on an O/D basis are operated connections may be available and if they work great but fundamentally it's about serving the local market and connection heavy flights need to be cut. This is complicated of course by the national branding of these airlines but considers in the US the average hub is in a city of 5.5 million people while the average hub in Europe serves a city of 2.4 million (1.8 million if you exclude London and Paris). So your right not every hub is ATL or DFW but the average hub looks substantially more like ATL or DFW then it does CLT or SLC the only two US hubs with populations below that of the average european hub. Essentially europe has 5-10 more hubs then it needs and they need to disappear at some point and I suspect brussels will be on the hit list.
 
wenders825
Posts: 372
Joined: Thu Sep 29, 2016 7:29 pm

Re: Reports: LH might let SN file for bankruptcy

Wed Jun 24, 2020 10:12 pm

Conti764 wrote:
Jetty wrote:
sabenapilot wrote:

Ah, the generalisations of the internet...

The airline has been profitable 3 of the last 5 years

Yet if you take the total of the last 5 years they are still losing money, and this is true for any period of 5 years of Sabena and Brussels Airlines. Reality is Belgium doesn't care much about aviation and this is what is needed to have a successful flag carrier in a small European country. They sold the airport, have no longterm aviation policy, air traffic controllers like to strike regularly and the airport is even the subject of a fight between some of the many Belgian governments with Brussels imposing high fines on airlines for merely using the airport.


Belgium in a nutshell: a mess.
One can wonder if Belgium will even still excist in, let's say, 3 to 5 years...

this thread is absurd
 
Conti764
Posts: 62
Joined: Tue Dec 11, 2007 2:09 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 6:32 am

dstblj52 wrote:
MIflyer12 wrote:
dstblj52 wrote:

The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland ...

I see your point - and substantially agree - but I think the Memphis and Cleveland references are low... in O and D traffic. Not every hub in the U.S. is ATL or DFW. There's room in Europe for more than London, Paris, Frankfurt and Amsterdam. (The idea that Brussels O and D should just take a train to CDG or AMS is utterly ridiculous. Lots of cities worldwide support fairly short-duration flights. BRU is no different. )

If BRU can't get a consistent fare premium from its O and D destination set (reference Africa), and has to compete with 1-stops, it needs to focus on cost productivity, and that means wage rates and work rules. Good luck with that.

I think what needs to happen is that brussel will become more of a focus city where routes that can be filled with profitable fares on an O/D basis are operated connections may be available and if they work great but fundamentally it's about serving the local market and connection heavy flights need to be cut. This is complicated of course by the national branding of these airlines but considers in the US the average hub is in a city of 5.5 million people while the average hub in Europe serves a city of 2.4 million (1.8 million if you exclude London and Paris). So your right not every hub is ATL or DFW but the average hub looks substantially more like ATL or DFW then it does CLT or SLC the only two US hubs with populations below that of the average european hub. Essentially europe has 5-10 more hubs then it needs and they need to disappear at some point and I suspect brussels will be on the hit list.


Why do you think United flies three widebodies a day (amongst them their flagship 787-10 for one route and before Covid they planned a second one) to BRU? For its O&D market? Before the March 22 attacks they were even looking at a daily second EWR rotation.

The same matters for ANA. Without BRU's hubfunction they'd never fly the route.
 
dstblj52
Posts: 408
Joined: Tue Nov 19, 2019 8:38 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 7:22 am

Conti764 wrote:
dstblj52 wrote:
MIflyer12 wrote:
The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland ...

I think what needs to happen is that brussel will become more of a focus city where routes that can be filled with profitable fares on an O/D basis are operated connections may be available and if they work great but fundamentally it's about serving the local market and connection heavy flights need to be cut. This is complicated of course by the national branding of these airlines but considers in the US the average hub is in a city of 5.5 million people while the average hub in Europe serves a city of 2.4 million (1.8 million if you exclude London and Paris). So your right not every hub is ATL or DFW but the average hub looks substantially more like ATL or DFW then it does CLT or SLC the only two US hubs with populations below that of the average european hub. Essentially europe has 5-10 more hubs then it needs and they need to disappear at some point and I suspect brussels will be on the hit list.


Why do you think United flies three widebodies a day (amongst them their flagship 787-10 for one route and before Covid they planned a second one) to BRU? For its O&D market? Before the March 22 attacks they were even looking at a daily second EWR rotation.

The same matters for ANA. Without BRU's hubfunction they'd never fly the route.

No I agree those planes likely have a decent percentage of connections but if SN cannot be profitable due to the limited O/D market in Brussels it's going to get cut and Brussels turned into a focus city for someone there just reality. Regardless of how much people in Brussels like their hub status if the local yields are not strong enough the hub needs to be cut.
 
eamondzhang
Posts: 1729
Joined: Thu Sep 23, 2010 8:23 am

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 7:53 am

Conti764 wrote:
The same matters for ANA. Without BRU's hubfunction they'd never fly the route.

Not from what I heard. The flight is predominantly O&D (or few flight connections to be more accurate) on BRU end for ANA from my source.

Michael
 
Jetty
Posts: 1284
Joined: Wed Nov 11, 2015 12:27 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 9:21 am

Conti764 wrote:
dstblj52 wrote:
MIflyer12 wrote:
The problem of Brussels airlines is the same problem that hubs like Memphis and Cleveland ...

I think what needs to happen is that brussel will become more of a focus city where routes that can be filled with profitable fares on an O/D basis are operated connections may be available and if they work great but fundamentally it's about serving the local market and connection heavy flights need to be cut. This is complicated of course by the national branding of these airlines but considers in the US the average hub is in a city of 5.5 million people while the average hub in Europe serves a city of 2.4 million (1.8 million if you exclude London and Paris). So your right not every hub is ATL or DFW but the average hub looks substantially more like ATL or DFW then it does CLT or SLC the only two US hubs with populations below that of the average european hub. Essentially europe has 5-10 more hubs then it needs and they need to disappear at some point and I suspect brussels will be on the hit list.


Why do you think United flies three widebodies a day (amongst them their flagship 787-10 for one route and before Covid they planned a second one) to BRU? For its O&D market? Before the March 22 attacks they were even looking at a daily second EWR rotation.

UA used to fly more planes to AMS with very few connections and a similar catchment population. Thus it might very well be for the O&D market at BRU as well.
 
davidjohnson6
Posts: 804
Joined: Mon Jun 20, 2016 10:10 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 9:27 am

Brussels is the headquarters of NATO and the European Union. I would have thought both these organisations would generate significant levels of traffic to Washington
 
dstblj52
Posts: 408
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Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 9:35 am

davidjohnson6 wrote:
Brussels is the headquarters of NATO and the European Union. I would have thought both these organisations would generate significant levels of traffic to Washington

Most government travel is low yielding crap (because it's high volume and they use that to negotiate significant discounts) with a lot of headaches attached the money is in government contractor and lobbyist traffic which generally doesn't flow between centers of power like that where the money is in walk up fares and business class tickets.
 
vinniewinnie
Posts: 728
Joined: Mon Nov 28, 2005 4:23 am

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 10:24 am

Focusing on brussels airlines profitability on its own rather than comparing it to its peers is nonsense.

Aviation is generally speaking a low margin business unless obviously competition is weak (US domestic market anyone?). By asking such a rate of return, LH has put itself in a bind.

I truly believe smaller carriers can never be as profitable as big carriers. However they have a role to play, especially when it comes to helping the mother company . By being in the market they stop competitors from the mother company from getting bigger and stronger. They also feed the mother company hubs. Finally they can offer something different. In the case of SN it is a large African network.

Therefore, I believe there is a case to be made for keeping SN in LH group, providing more realistic profit targets are set.

SN is not a particularly good airline (inflight product is mediocre for example), but it has a role to play within a bigger group.
 
RvA
Posts: 375
Joined: Tue Sep 15, 2015 12:37 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 10:28 am

SN isn’t going anywhere. They have a role to play as many have already said. It will be very interesting (provided things stabilise) where the Lufthansa Group will be in 5 years time and how each of its entities are performing.
 
BrianDromey
Posts: 2663
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Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 11:00 am

RvA wrote:
SN isn’t going anywhere. They have a role to play as many have already said. It will be very interesting (provided things stabilise) where the Lufthansa Group will be in 5 years time and how each of its entities are performing.


They have a role to play, but the issue when part of a larger group is that it is difficult to justify investing in a business unit where the returns wont match, or be less than investing in another. The LH board has the option to invest 5 x A320s in FRA, ZRH, VIE or BRU - the business cases have to stack up. On a smaller scale this is why we see ZRH dominate over GVA at LX and the closure of BSL, for example. It's a case of return on investment. At IAG, BA gets the lions share of capital investment too, because the returns from the LON market have been much higher, relatively.
 
Conti764
Posts: 62
Joined: Tue Dec 11, 2007 2:09 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 2:53 pm

Jetty wrote:
Conti764 wrote:
dstblj52 wrote:
I think what needs to happen is that brussel will become more of a focus city where routes that can be filled with profitable fares on an O/D basis are operated connections may be available and if they work great but fundamentally it's about serving the local market and connection heavy flights need to be cut. This is complicated of course by the national branding of these airlines but considers in the US the average hub is in a city of 5.5 million people while the average hub in Europe serves a city of 2.4 million (1.8 million if you exclude London and Paris). So your right not every hub is ATL or DFW but the average hub looks substantially more like ATL or DFW then it does CLT or SLC the only two US hubs with populations below that of the average european hub. Essentially europe has 5-10 more hubs then it needs and they need to disappear at some point and I suspect brussels will be on the hit list.


Why do you think United flies three widebodies a day (amongst them their flagship 787-10 for one route and before Covid they planned a second one) to BRU? For its O&D market? Before the March 22 attacks they were even looking at a daily second EWR rotation.

UA used to fly more planes to AMS with very few connections and a similar catchment population. Thus it might very well be for the O&D market at BRU as well.


I doubt it since Brussels is nowhere near the market Amsterdam is. Its touristic industry is much bigger and The Netherlands has more major companies than Belgium, which essentialy relies on Brussels as the de facto European capital and NATO.
 
dstblj52
Posts: 408
Joined: Tue Nov 19, 2019 8:38 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 3:45 pm

vinniewinnie wrote:
Focusing on brussels airlines profitability on its own rather than comparing it to its peers is nonsense.

Aviation is generally speaking a low margin business unless obviously competition is weak (US domestic market anyone?). By asking such a rate of return, LH has put itself in a bind.

I truly believe smaller carriers can never be as profitable as big carriers. However they have a role to play, especially when it comes to helping the mother company . By being in the market they stop competitors from the mother company from getting bigger and stronger. They also feed the mother company hubs. Finally they can offer something different. In the case of SN it is a large African network.

Therefore, I believe there is a case to be made for keeping SN in LH group, providing more realistic profit targets are set.

SN is not a particularly good airline (inflight product is mediocre for example), but it has a role to play within a bigger group.

I think SN needs to schedule itself pretty much exclusively for O/D and ignore connecting traffic, any routes that need connecting traffic needs to be moved to other hubs, but this needs to be downsized to the size of to something more like CVG or RDU cities with similar populations, small connecting hubs don't work but larger cities work just fine as focus cities but that creates all sorts of national prestige issues.
 
davidjohnson6
Posts: 804
Joined: Mon Jun 20, 2016 10:10 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 3:53 pm

Does SN have the cost structure to change its business model from a network airline to a point-to-point airline ? I suspect that there would need to be major surgery on SN to change its structure...
 
vinniewinnie
Posts: 728
Joined: Mon Nov 28, 2005 4:23 am

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 6:16 pm

dstblj52 wrote:
vinniewinnie wrote:
Focusing on brussels airlines profitability on its own rather than comparing it to its peers is nonsense.

Aviation is generally speaking a low margin business unless obviously competition is weak (US domestic market anyone?). By asking such a rate of return, LH has put itself in a bind.

I truly believe smaller carriers can never be as profitable as big carriers. However they have a role to play, especially when it comes to helping the mother company . By being in the market they stop competitors from the mother company from getting bigger and stronger. They also feed the mother company hubs. Finally they can offer something different. In the case of SN it is a large African network.

Therefore, I believe there is a case to be made for keeping SN in LH group, providing more realistic profit targets are set.

SN is not a particularly good airline (inflight product is mediocre for example), but it has a role to play within a bigger group.

I think SN needs to schedule itself pretty much exclusively for O/D and ignore connecting traffic, any routes that need connecting traffic needs to be moved to other hubs, but this needs to be downsized to the size of to something more like CVG or RDU cities with similar populations, small connecting hubs don't work but larger cities work just fine as focus cities but that creates all sorts of national prestige issues.


That is silly you don’t for example fill an African flight with OD traffic only! That is why no matter what SN will need to keep flights to destination that don’t warrant it on a purely OD basis (CDG, LHR being the prime example)

So yeah a pure OD strategy will not work. Lowering costs is probably the answer. Shrinking a little might make sense as well then again if you reduce frequency you may lose valuable customers!
 
dstblj52
Posts: 408
Joined: Tue Nov 19, 2019 8:38 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 6:37 pm

vinniewinnie wrote:
dstblj52 wrote:
vinniewinnie wrote:
Focusing on brussels airlines profitability on its own rather than comparing it to its peers is nonsense.

Aviation is generally speaking a low margin business unless obviously competition is weak (US domestic market anyone?). By asking such a rate of return, LH has put itself in a bind.

I truly believe smaller carriers can never be as profitable as big carriers. However they have a role to play, especially when it comes to helping the mother company . By being in the market they stop competitors from the mother company from getting bigger and stronger. They also feed the mother company hubs. Finally they can offer something different. In the case of SN it is a large African network.

Therefore, I believe there is a case to be made for keeping SN in LH group, providing more realistic profit targets are set.

SN is not a particularly good airline (inflight product is mediocre for example), but it has a role to play within a bigger group.

I think SN needs to schedule itself pretty much exclusively for O/D and ignore connecting traffic, any routes that need connecting traffic needs to be moved to other hubs, but this needs to be downsized to the size of to something more like CVG or RDU cities with similar populations, small connecting hubs don't work but larger cities work just fine as focus cities but that creates all sorts of national prestige issues.


That is silly you don’t for example fill an African flight with OD traffic only! That is why no matter what SN will need to keep flights to destination that don’t warrant it on a purely OD basis (CDG, LHR being the prime example)

So yeah a pure OD strategy will not work. Lowering costs is probably the answer. Shrinking a little might make sense as well then again if you reduce frequency you may lose valuable customers!

If you can't fill that flight with pure OD give it to Lufthansa who can run it through a much more powerful hub which drives down casm and creates more potentially high dollar connecting opportunities (if everyone else offers a two-stop you can charge a premium on a one-stop), yes Brussels has a lot of specialized people in Africa to make that market work give them a Lufthansa shirt and a new boss to report to and then it's done. Realistically the math on losing valuable customers is simple if you're in Brussels SN still has more nonstop routes then anyone else does and their likely going to have a better schedule then any connecting opportunity and if you're not in Brussels or going to Brussels you shouldn't be connecting there. The reason delta made way more money than every other airline in 2019 is Atlanta and to build Atlanta Delta sacrificed Memphis and CVG likewise to build Frankfort Lufthansa has to kill any competing hub that doesn't have a special value prop. Swiss has a special value prop simply due to its extremely high yields which means it makes sense to keep around but in my opinion both Brussel and Austrian need to stop being hubs and instead focus purely on O/D routes to instead route that traffic through Frankfort (people connecting choose purely on price and schedule general but stick the local code on it if you must).
 
davidjohnson6
Posts: 804
Joined: Mon Jun 20, 2016 10:10 pm

Re: Reports: LH might let SN file for bankruptcy

Thu Jun 25, 2020 7:11 pm

Of the Africa routes, what proportion of pax have Belgium (or maybe Lille or southern Netherlands) as an origin/destination rather than connecting to somewhere else ? Whenever I've walked around southern Germany, I see very few people from Francophone Africa. I'm not sure how many of these routes Lufthansa can serve profitably via MUC when almost everybody is connecting to somewhere else
 
berari
Posts: 901
Joined: Wed Jul 06, 2016 3:47 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 1:20 am

LJ wrote:
It doesn't need to close if SN would be gone. DHL will still be there just like all the other airlines. Moreover, one can wonder if DHL is not more important than SN as having a logistics hub in your country has a lot of value for logistics companies and manufacturers..


I was intrigued to see how fragile BRU was when Ethiopian Cargo moved its flights to Maastricht a few years ago in dispute over no traffic rights. BRU worked hard to get it back, for it was too valuable.

What does SN have that LH doesn't have? If SN collapses or shrinks to only regional flights, can LH take over via FRA or is BRU more important to West African pax? I do recall Sabena having a strong brand in Africa.
 
Blerg
Topic Author
Posts: 3979
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Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 6:12 am

Well, in the end we will have to see what becomes of SN. They were struggling before corona and I feel they will struggle even more now, especially since neither FR nor W6 are showing signs of slowing down. Brussels is a good market for them because, despite all the institutions being there, it's a price sensitive market.
 
Jetty
Posts: 1284
Joined: Wed Nov 11, 2015 12:27 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 9:02 am

berari wrote:
LJ wrote:
It doesn't need to close if SN would be gone. DHL will still be there just like all the other airlines. Moreover, one can wonder if DHL is not more important than SN as having a logistics hub in your country has a lot of value for logistics companies and manufacturers..

What does SN have that LH doesn't have? If SN collapses or shrinks to only regional flights, can LH take over via FRA or is BRU more important to West African pax? I do recall Sabena having a strong brand in Africa.

Brussels has a whole neighborhood where it feels and looks more like Africa than Europe so Brussels must have more O&D than LH group other hubs.
 
airhansa
Posts: 380
Joined: Wed Jan 08, 2020 3:18 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 2:24 pm

I would actually agree with the proposal to turn re-brand the airline as "Eurowings" and have it serve as a primarily low cost airline with flights to Africa and the UK/Scandinavia. It could directly compete with KLM and AMS. A premium product could be used on flights to Africa.

Furthermore, I don't think it's silly to suggest that Belgians could take the train to AMS to CDG. Remember than LON to AMS has a larger market share on rail than by air.
 
Conti764
Posts: 62
Joined: Tue Dec 11, 2007 2:09 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 2:41 pm

airhansa wrote:
I would actually agree with the proposal to turn re-brand the airline as "Eurowings" and have it serve as a primarily low cost airline with flights to Africa and the UK/Scandinavia. It could directly compete with KLM and AMS. A premium product could be used on flights to Africa.


Lufthansa tried and failed miserabely. They should have cleaned up the mess at EW before incorporating other carriers into it.

Furthermore, I don't think it's silly to suggest that Belgians could take the train to AMS to CDG. Remember than LON to AMS has a larger market share on rail than by air.


So you are basicly suggesting the Lufthansa Group has to surrender everything west of Germany to AF/KL? No logic at all imho. They'd better have SN steal away anything they can from their main competing airline group.

For the time being and as long as SN isn't financially sound have them retain their African operations, reposition it into a more classic airline and only let them retain the profitable short haul routes or those which are vital for the long haul operations, thus axing (most of) the leisure flights.

And if the Reboot plan turns out positive, gradually let SN expand where possible. Let them set a foot in some of the long haul markets AF and KL now have a (near) monopoly on. BRU is idealy located in between AMS and CDG and although SN and BRU won't topple those megahubs, it offers options to make money. After all, BRU isn't exactly a long ride from Southern Netherlands or Northern France and it is a way more convenient airport then both megaports to the North and the South.

Speaking about BRU, it is a private company which needs to make money as well. LH giving up everything SN has to offer to KL and AF and thus AMS and CDG will only lead to BRU venturing other options thus ultimately leading to LH having exactly what they wanted to avoid by buying SN in the first place: (too) much competition in a hub at only a few hundred km's from FRA.
 
RvA
Posts: 375
Joined: Tue Sep 15, 2015 12:37 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 3:05 pm

airhansa wrote:
I would actually agree with the proposal to turn re-brand the airline as "Eurowings" and have it serve as a primarily low cost airline with flights to Africa and the UK/Scandinavia. It could directly compete with KLM and AMS. A premium product could be used on flights to Africa.

Furthermore, I don't think it's silly to suggest that Belgians could take the train to AMS to CDG. Remember than LON to AMS has a larger market share on rail than by air.


You don’t think its silly? Focusing on rail alone, have a look at Ghent/Bruges to AMS or CDG vs BRU. But what about people who drive? Brussels also serves Dutch and French people in border regions too. If you’re in Maastricht going to BRU or going to AMS is a very valid alternative. As is DUS for that matter.
 
airhansa
Posts: 380
Joined: Wed Jan 08, 2020 3:18 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 4:22 pm

berari wrote:
LJ wrote:
It doesn't need to close if SN would be gone. DHL will still be there just like all the other airlines. Moreover, one can wonder if DHL is not more important than SN as having a logistics hub in your country has a lot of value for logistics companies and manufacturers..


I was intrigued to see how fragile BRU was when Ethiopian Cargo moved its flights to Maastricht a few years ago in dispute over no traffic rights. BRU worked hard to get it back, for it was too valuable.

What does SN have that LH doesn't have? If SN collapses or shrinks to only regional flights, can LH take over via FRA or is BRU more important to West African pax? I do recall Sabena having a strong brand in Africa.


A solution would be to consolidate all Lufthansa's Africa operations into BRU, with a high speed railway ticket to FRA and/or "LH1" product to FRA.

I still support the idea of having a mostly no-frills low cost airline that happens to serve premium products on long haul routes (i.e. Africa). Alternatively it could try to expand in Africa in terms of fifth freedom routes.

Though this entire thing is driven by nationalism and what I believe is the problem with Europe's aviation market. What's needed is brand and airline consolidation - and LH really ought to be just two brands, LH and EW.
 
dstblj52
Posts: 408
Joined: Tue Nov 19, 2019 8:38 pm

Re: Reports: LH might let SN file for bankruptcy

Fri Jun 26, 2020 4:38 pm

airhansa wrote:
berari wrote:
LJ wrote:
It doesn't need to close if SN would be gone. DHL will still be there just like all the other airlines. Moreover, one can wonder if DHL is not more important than SN as having a logistics hub in your country has a lot of value for logistics companies and manufacturers..


I was intrigued to see how fragile BRU was when Ethiopian Cargo moved its flights to Maastricht a few years ago in dispute over no traffic rights. BRU worked hard to get it back, for it was too valuable.

What does SN have that LH doesn't have? If SN collapses or shrinks to only regional flights, can LH take over via FRA or is BRU more important to West African pax? I do recall Sabena having a strong brand in Africa.


A solution would be to consolidate all Lufthansa's Africa operations into BRU, with a high speed railway ticket to FRA and/or "LH1" product to FRA.

I still support the idea of having a mostly no-frills low cost airline that happens to serve premium products on long haul routes (i.e. Africa). Alternatively it could try to expand in Africa in terms of fifth freedom routes.

Though this entire thing is driven by nationalism and what I believe is the problem with Europe's aviation market. What's needed is brand and airline consolidation - and LH really ought to be just two brands, LH and EW.

I would say even then having two brands is silly they really should just have one brand LH, and looking at it if it was all one brand LH has too many hubs too close together.
 
SCQ83
Posts: 5677
Joined: Wed Oct 03, 2012 8:32 pm

Re: Reports: LH might let SN file for bankruptcy

Sat Jun 27, 2020 7:40 am

Jetty wrote:
UA used to fly more planes to AMS with very few connections and a similar catchment population. Thus it might very well be for the O&D market at BRU as well.


- AMS has a much larger catchment area (compare the population of NL to BE; it is about double).
- AMS is a local wealthier market
- AMS is a major international tourism destination (a lot of Americans for instance), BRU is not.
- AMS is the Euro HQ for many US companies. Tesla, Netflix or Nike Euro operations are HQed in AMS.

YIMBY wrote:
There is certainly O&D traffic to Brussels, and the airport is often at the limits of its capacity, as every major European airline flies there. It is also expensive. Compare (pre-COVID) prices from almost any airport, by almost any airline, to BRU and AMS, to find that BRU is significantly more expensive, often >100 €. What is the root cause for that?


My experience having flown to/from BRU many times is the contrary. Brussels is almost every time the cheapest option. For short-haul, Ryanair at CRL (and BRU too) is a massive competition (Ryanair is a huge share market in BRU+CRL). For long haul for things like BRU-NYC you end up having 3 carriers (not bad for a city of its size). Since BRU is not a tourism destination for Americans, those carriers need to be very aggressive in summer to get traffic; and if you connect (BRU-Europe is also half empty; so a BRU-LHR is not particularly full) prices will lower even more.
 
Westerwaelder
Posts: 223
Joined: Fri Apr 03, 2020 12:27 pm

Re: Reports: LH might let SN file for bankruptcy

Sat Jun 27, 2020 7:45 am

dstblj52 wrote:
airhansa wrote:
berari wrote:

I was intrigued to see how fragile BRU was when Ethiopian Cargo moved its flights to Maastricht a few years ago in dispute over no traffic rights. BRU worked hard to get it back, for it was too valuable.

What does SN have that LH doesn't have? If SN collapses or shrinks to only regional flights, can LH take over via FRA or is BRU more important to West African pax? I do recall Sabena having a strong brand in Africa.


A solution would be to consolidate all Lufthansa's Africa operations into BRU, with a high speed railway ticket to FRA and/or "LH1" product to FRA.

I still support the idea of having a mostly no-frills low cost airline that happens to serve premium products on long haul routes (i.e. Africa). Alternatively it could try to expand in Africa in terms of fifth freedom routes.

Though this entire thing is driven by nationalism and what I believe is the problem with Europe's aviation market. What's needed is brand and airline consolidation - and LH really ought to be just two brands, LH and EW.

I would say even then having two brands is silly they really should just have one brand LH, and looking at it if it was all one brand LH has too many hubs too close together.


That makes no sense given the sensitivities in Europe. Having local brands works well in most countries.
 
LJ
Posts: 5291
Joined: Wed Nov 17, 1999 8:28 pm

Re: Reports: LH might let SN file for bankruptcy

Sat Jun 27, 2020 9:56 am

airhansa wrote:
A solution would be to consolidate all Lufthansa's Africa operations into BRU, with a high speed railway ticket to FRA and/or "LH1" product to FRA.


The links between Belgium and Eastern parts of Africa and South Africa are not that tight. Moreover, it would erode yields if LH doesn't offer African destinations to which it has a sizeable O&D (for example South Africa). The same for destinations which require a specific feed.

airhansa wrote:
I still support the idea of having a mostly no-frills low cost airline that happens to serve premium products on long haul routes (i.e. Africa). Alternatively it could try to expand in Africa in terms of fifth freedom routes.


Fith freedom flights aren't very profitable (if you get it).

airhansa wrote:
Though this entire thing is driven by nationalism and what I believe is the problem with Europe's aviation market. What's needed is brand and airline consolidation - and LH really ought to be just two brands, LH and EW.


Multiple brands does have its benefit. You can position them differently. For example, Swiss has probably a higher standing than Lufthansa. Should you alienate those passengers?
 
airhansa
Posts: 380
Joined: Wed Jan 08, 2020 3:18 pm

Re: Reports: LH might let SN file for bankruptcy

Sat Jun 27, 2020 1:57 pm

LJ wrote:

airhansa wrote:
Though this entire thing is driven by nationalism and what I believe is the problem with Europe's aviation market. What's needed is brand and airline consolidation - and LH really ought to be just two brands, LH and EW.


Multiple brands does have its benefit. You can position them differently. For example, Swiss has probably a higher standing than Lufthansa. Should you alienate those passengers?


It would be nice to know why SWISS has a higher standing than Lufthansa, and try to replicate the profitable parts. For example, would "SWISS CLASS" as a business class product on LH planes work? Are the passengers primarily intercity for whom a "Lufthansa SWISS shuttle" would cater for?

But going back to Brussels Airlines. It isn't a long standing brand anyway. If you're looking to maintain ties to Africa and sustain a classic brand, then bring back the SABENA brand for Africa flights. You could have all other flights out of BRU operated by Lufthansa.
 
LJ
Posts: 5291
Joined: Wed Nov 17, 1999 8:28 pm

Re: Reports: LH might let SN file for bankruptcy

Sat Jun 27, 2020 2:54 pm

airhansa wrote:
It would be nice to know why SWISS has a higher standing than Lufthansa, and try to replicate the profitable parts. For example, would "SWISS CLASS" as a business class product on LH planes work? Are the passengers primarily intercity for whom a "Lufthansa SWISS shuttle" would cater for?


It's probably the identification with Switzerland which makes it higher yielding (and add some quality to the brand). Such a thing will never work at LH. Given how nationalistic the Swiss are (at least that's the impresssion I get), rebranding Swiss into Lufthansa is throwing away a lot of capital (something LH cannot afford right now).

BTW Why not rebrand Lufthansa into Swiss :smile:

airhansa wrote:
But going back to Brussels Airlines. It isn't a long standing brand anyway. If you're looking to maintain ties to Africa and sustain a classic brand, then bring back the SABENA brand for Africa flights. You could have all other flights out of BRU operated by Lufthansa.


They could bring back Sabena, but after all those years, why waste rebranding again (if you actually own the brand).
 
User avatar
Revelation
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Re: Reports: LH might let SN file for bankruptcy

Sat Jun 27, 2020 2:55 pm

SCQ83 wrote:
Jetty wrote:
UA used to fly more planes to AMS with very few connections and a similar catchment population. Thus it might very well be for the O&D market at BRU as well.

- AMS has a much larger catchment area (compare the population of NL to BE; it is about double).
- AMS is a local wealthier market
- AMS is a major international tourism destination (a lot of Americans for instance), BRU is not.
- AMS is the Euro HQ for many US companies. Tesla, Netflix or Nike Euro operations are HQed in AMS.

Wow, I got a lot of blowback here on a.net for daring to make this type of comparison. I guess the defenders of Belgium are not manning their posts these days. Personally, I would really enjoy a trip to either, but I know which one would attract more from my circle of friends.
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