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mercure1
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Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 3:54 pm

Effective September 1st, Brussels Airlines says it will offer new pricing formula on European flights.

Per company it must adapt to how people wish to travel and European travel trends are being set by LCC carriers which require a new business strategy by SN ticket pricing in response.

With change, SN will only offer 4 price points categories -
- check & go
- light & relax
- flex & fast
- biz & class

Each category will offer different charges for service and increasing benefits as you climb the ladder.

As part of this change SN also says it will introduce a €69(including taxes) base rate for all its European services.

Per SN CEO Bernard Gustin, the company must act as a hybrid airline that offers something for all budgets solution to be the best value.


article (in French)
http://www.lalibre.be/economie/actua...-low-cost-53c534d835702004f7d61bb5
and
http://www.pagtour.net/index.php?opt...n=com_content&view=article&id=4967


I think this is realization by SN that it can no longer dream to be typical network carrier of the past as Brussels and Benelux region sees very high activity by LCC carriers.

I also wonder if these changes are timed or in relations to Lufthansa's announcement last week that it will also further adjust its intra-Europe flying in favor of increase in LCC mode.

[Edited 2014-07-15 09:05:58]
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SCQ83
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 4:11 pm

69 EUR is quite a lot for European services with Ryanair being so popular down the road at CRL.

Air France continuously has 49 EUR promotions, and Lufthansa have them from time to time. And Ryanair does not push prices in Paris, Frankfurt or Munich to the extent they do in Brussels.
 
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mercure1
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 4:47 pm

Quoting SCQ83 (Reply 1):
69 EUR is quite a lot for European services with Ryanair being so popular down the road at CRL.

Air France continuously has 49 EUR promotions, and Lufthansa have them from time to time. And Ryanair does not push prices in Paris, Frankfurt or Munich to the extent they do in Brussels.

The €69 will be the standard base rate for check & go.
I am sure there will be regular promotions which will lower fares to various destinations or times.

Also reminded that Ryanair is now at BRU also now with service to 10 or so destinations so far.
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runway23
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 4:50 pm

Quoting SCQ83 (Reply 1):
69 EUR is quite a lot for European services with Ryanair being so popular down the road at CRL.

It is actually 69 EUR Roundtrip, so quite competitive. SN have not announced whether they will sell any one-way fares with this new pricing model.
 
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LAXintl
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 5:01 pm

If you cant beat them, join them.

Though I am not sure this will help them much in the bottom line.
Might actually make is worse if revenues drop to LCC levels, while SN still has a much higher cost base.
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SCQ83
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 5:04 pm

Quoting runway23 (Reply 3):
It is actually 69 EUR Roundtrip, so quite competitive. SN have not announced whether they will sell any one-way fares with this new pricing model.

My mistake...you are right; it clearly says "Des billets aller-retour à partir de 69 euros toutes taxes comprises".

Still I don't understand why they do not offer one-way fares (LH and LX offer them; specially Swiss to compete with easyJet).
 
drgmobile
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 5:09 pm

I'm not sure it's fair to categorize this as an "LCC Pricing Model." It's more appropriately categorized as the pricing model of a whole host of traditional carriers developed as a competitive response to the proliferation of LCCs. In fact, it was Air Canada that was one of the first carriers to introduce a segmented pricing model like this.
 
gabrielchew
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 5:41 pm

Quoting mercure1 (Thread starter):
- check & go
- light & relax
- flex & fast
- biz & class

Who comes up with these stupid names? Do the folks in airline marketing think that these bizarre and unlcear names make customers go giddy at the knees and reach for their credit card? People might think that "check & go" means "fast track at check in, so you can get onto the plane first", rather than "nothing is included, pay for bags/seat/drink etc etc etc".

Quoting mercure1 (Thread starter):
As part of this change SN also says it will introduce a €69(including taxes) base rate for all its European services.

Not bad for a retrun fare, although as others have said, it's be good to see some cheap o/w fares listed.
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 6:07 pm

Quoting mercure1 (Thread starter):
I think this is realization by EW: SN Brussels Airlines (Belgium)">SN that it can no longer dream to be typical network carrier of the past as Brussels and Benelux region sees very high activity by LCC carriers.

I also wonder if these changes are timed or in relations to Lufthansa's announcement last week that it will also further adjust its intra-Europe flying in favor of increase in LCC mode.

Sounds like they are getting ready for becoming EW as part of LH’s announcement. That’s a very competitive starting price IMO. My last EW: SN Brussels Airlines (Belgium)">SN flight in May (TXL-BRU) reminded me of 4U or EW, all economy, bad BoB choices, small individual soap bar in the bathroom in lieu of a larger liquid soap bottle.

IMO EW: SN Brussels Airlines (Belgium)">SN has tremendous strength BRU-Africa and weakness everywhere else. Which is sad because the EW: SN Brussels Airlines (Belgium)">SN staff I met were all very courteous and friendly, at check-in, on the plane and at the lounge in BRU. Hope they get to retain their long-haul and aren’t entirely incorporated into the new “Wings” family.

Quoting gabrielchew (Reply 7):
Who comes up with these stupid names?

Biz & Class is the funniest one to me, thanks EW: SN Brussels Airlines (Belgium)">SN marketing for separating the two.

A lot of it is shooting for the lowest common denominator. After all, you don’t just have to appeal to English speakers, but also to those who don’t speak English at all and those who think they understand it but really don’t. Bastardizing English seems to be a favorite Continental pastime, fortunately it’s not always a downhill trajectory: http://www.economist.com/news/busine...men-linguistic-purity-no-denglisch
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jetblue1965
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 6:12 pm

I wonder how much LH Group HQ has to do with this

Between choosing LH LX OS SN to go down-scale, the easiest sacrificial lamb is SN. And if OS doesn't turn itself around financially, they're next in line for the guillotine.
 
smbukas
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RE: Brussels Airlines To Adopt LCC Pricing Model

Tue Jul 15, 2014 6:31 pm

I do not see nothing new in this model.

As of today, Brussels Airlines has b.light, b.flex and b.business.
b.light is regular economy with checked-in bag and BoB service, b.flex more flexibility and meal, b.business is just business.

I guess the single new type will be check&go, I guess, this will be economy "no bag".
Other three types are the same, just rebranded.
 
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mercure1
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 3:20 pm

Seems the changes at SN are deeper than just fare pricing changes.

SN CEO says a new loyalty program will be launched at the end of the year in addition to LH Miles & More program aimed primarily at those traveling within Europe.

He says it critical company break with old traditions by reposition and adjust its European product to better suit the market and consumer demands.

Its mentioned this relaunch has been in study for over 1-year. He also mentions renewal of fleet is important. (who can make money on Avro with LCC pricing?)

At conference someone ask about LH announced adjustments to Europe, and CEO answer that what SN is doing is "perfectly in line" with LH Wings concept and that SN has already implemented many of these core elements.


Links
http://www.air-journal.fr/2014-07-16...-leurope-en-septembre-5110742.html
http://www.hln.be/hln/nl/942/Economi...r-en-lanceert-lowcostformule.dhtml
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jetblue1965
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 3:28 pm

Quoting mercure1 (Reply 11):


At conference someone ask about LH announced adjustments to Europe, and CEO answer that what SN is doing is "perfectly in line" with LH Wings concept and that SN has already implemented many of these core elements.

Or how about a really radical suggestion - put all the SN LCC-ized intra-EU short-haul in the Eurowings brand, and only keep the "brussels" brand for long-haul services to US and Africa ?
 
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mercure1
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 3:59 pm

It would be one thing to use common marketing name, but you would still be multiple separate airline with separate nationalities, AOC licences, unions, etc. Also how do you deal with traffic rights outside the EU which is still based on nationality of carrier often?
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Skyeurope
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 4:00 pm

Quoting SCQ83 (Reply 5):
Still I don't understand why they do not offer one-way fares (LH and LX offer them; specially Swiss to compete with easyJet).

LH usually only offers attractive oneway fares on domestic flights.
 
spantax
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 4:30 pm

I have THE SOLUTION for Brussels Airlines..... : become the first real all-turboprop LCC in Europe and keep only big jets for Africa and the rest of the world. Being, literallly, at the heart of Europe, means a lot of interesting destinations reachable by a Q400 or ATR at competitive flight times compared to an A320. Thus, the real problem of Brussels Airlines, their uncompetitive cost base, could be overcome. And 20-30-40 extra minutes in these typical turboflights shouldn't be a noticeable handicap (especially if compared to the cost of travelling by bus or train to CRL/Charleroi and the time lost).

 
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LAXintl
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 7:30 pm

As much as a large prop might be suited for market size and access, such types however don't lend themselves to LCC like revenue due to their high per seat cost base.
Props need revenue premiums, not discount fares to cover their cost on standalone basis.
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boysteve
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RE: Brussels Airlines To Adopt LCC Pricing Model

Wed Jul 16, 2014 8:38 pm

I will be honest, I do not care for SN. I can pay over GBP320 or €400 return UK to BRU and they still want to charge me €4 for a coffee! As a I do not travel with a checked bag I consider them to be U2 service for BA prices!!!
Before anyone starts FR is less useful as I am travelling North of BRU on arrival so CRL would increase my road distance by three fold and the traffic can be terrible.
However I am more surprised that SN has a 'high cost base'. When Sabena went bust why was the new Brussels Airlines not created with a lower cost base? SN should have a much lower costs in terms of staff wages than BA and LH following the bankruptcy surely!
 
r2rho
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RE: Brussels Airlines To Adopt LCC Pricing Model

Thu Jul 17, 2014 12:44 pm

Quoting smbukas (Reply 10):
I do not see nothing new in this model.
As of today, Brussels Airlines has b.light, b.flex and b.business.
b.light is regular economy with checked-in bag and BoB service, b.flex more flexibility and meal, b.business is just business.
I guess the single new type will be check&go, I guess, this will be economy "no bag".
Other three types are the same, just rebranded.

Agree. The only novelty seems to be the check&go for those traveling without baggage. This seems to be in line with similar moves by other EU legacies, such as AF "mini".

Quoting drgmobile (Reply 6):
I'm not sure it's fair to categorize this as an "LCC Pricing Model." It's more appropriately categorized as the pricing model of a whole host of traditional carriers developed as a competitive response to the proliferation of LCCs. In fact, it was Air Canada that was one of the first carriers to introduce a segmented pricing model like this

Indeed, it is unfair and incorrect. What SN is doing is simply adding another tier to its tiered fare structure, which is slowly becoming standard across Europe. This is similar to what for instance VY and 4U have. It is not comparable to a LCC fare structure such as U2 and FR.

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