From a corporate perspective, a short-haul product on long-haul routes is not necessarily the best way to send employees half-way round the world. But that said, even Air Asia X has a premium cabin with lie-flat seats. On short-haul routes the low-cost model has certainly made inroads with business travellers, but some buyers urge caution given that the overall cost can rise substantially once various fees are added – fees which are proving a pain in the rear for many travel buyers when trying to track and manage this fiddly area of spend. “Our clients are concerned not so much about
the ancillary fees themselves but more about the ability to capture the management information on those sales so that travel managers can understand the true value of airline deals,” says HRG’s Tony Berry. “We understand that ancillaries form a major
part of airline revenue, but our focus must now be on harvesting that information.”
Singapore Airlines ➔
networks, increased frequencies and, by cutting costs, offer more competitive fares. On the other hand, mergers mean there is less competition and there can often be a real mismatch in the quality of service and onboard product between two merging airlines – and consistency is key to keeping corporates happy. Says Egencia’s Jonny Shingles, “Consolidation
is accelerating and reshaping the international aviation industry. Airlines are getting better at working together but still have to progress on consistency in their commercial approach. “They are also now faced with the challenge of selling different products under one roof, at the risk of confusing travellers. Companies and travellers need to be advised on how to take advantage smartly of this situation.” HRG’s Tony Berry believes that mergers and acquisitions do put pressure on air tickets and that travel buyers should continually review their supplier programmes, especially those affected by mergers and joint ventures. “Clients are seeking the reassurance of negotiated corporate fares but they’re facing more confident supplier groups now,” he says, before adding that, on the plus side, there is a growing opportunity to negotiate with these new airline groups and alliances as a whole. Malaysia Airlines, Air Asia and Air Asia X are among the latest airlines to get together in what they call a Comprehensive Collaboration Framework (CCF) to explore cost-saving opportunities, or as the wordy press release says: “All parties will strive to complement each other’s businesses so as to leverage on their respective core competencies and optimise efficiency for the benefit of customers.” United and Continental got together in October
2010 but continue to operate separately until the new company receives a single operating
certificate from the Federal Aviation Adminis- tration. “They continue to make progress integrating products, services and policies to provide a more consistent travel experience for customers,” says a joint statement. Star Alliance carriers Lufthansa and ANA, meanwhile, are launching a strategic joint venture on their Japan-Europe routes. It follows a similar agreement between ANA and United Airlines on their trans-Pacific routes. Interestingly, BA chief executive Willie Walsh
told The Daily Telegraph in August that he wants to add TAP Air Portugal to IAG if the airline is put up for auction this autumn as expected. “TAP being sold is a once in a lifetime oppor-
tunity. The timing is not great. The markets are in turmoil at the moment. But I still think it’s worthwhile us taking a closer look at TAP. They have a great network and they are the number one carrier between Europe and Brazil.”
LOW-COST CONUNDRUMS At a time when altogether new airlines are something of a rarity, Japan is set to welcome its very first low-cost carrier, Peach. Confusingly, its colour scheme is purple, and the name was chosen for its ‘symbolism as a well-known and much loved fruit that symbolises longevity, energy and happiness across Asian countries.’ Its paint design, says the airline, ‘expresses cuteness, coolness and happiness’. More practical details include an anticipated launch date of March, with flights from its base at Kansai Airport to Sapporo, Fukuoka and Seoul. Singapore Airlines has also announced a low-
cost airline subsidiary. Due to launch next year on medium and long-haul routes, it is a sure sign of the business model’s potential on both short and long-haul services, as demonstrated by Air Asia's long-distance sister operation Air Asia X.
A NEW GENERATION OF AIRCRAFT Revolutionising air travel in their own way are the giant Airbus A380 and the long-awaited Boeing 787 Dreamliner. Some three years behind schedule, launch customer ANA will receive the first of its 55-strong Dreamliner order in September, with a maiden flight between Tokyo and Hong Kong pencilled in for October. Lightweight materials and advanced aero- dynamics mean it is the first mid-size aircraft capable of flying long-range routes, and Boeing estimates it could connect at least 450 new city pairs around the world given time. Overall, Boeing has taken 827 orders for the long-range, fuel-efficient aircraft, that also promises a whole new onboard experience for passengers. ANA says its customers will benefit from larger windows with electro-chromatic shades, bigger onboard luggage storage space and a more refreshing atmosphere within the cabin, all courtesy of the plane’s innovative design. The A380, meanwhile, with its double-decker, 500-passenger capacity is more suited to mass market, crowded routes. Airbus delivered its 50th A380 in June – to launch customer Singapore Airlines – while Korean Air is the sixth and latest airline to take delivery of the Superjumbo. In total, Airbus has 236 firm orders from 18 customers, including 12 for BA, a whopping 90 for Emirates, and six for Virgin Atlantic. Korean Air has deployed the aircraft on its flights to New York in August, following the launch of A380 services on its Seoul-Tokyo services in June. “Our aircraft are configured with fewer seats
than any other A380 airline to date and has passenger amenities not offered by any other carrier,” says Korean Air’s Americas marketing VP John Jackson. It has 407 seats in total, including 12 First Class Kosmo Suites and 94 lie-flat sleeper seats, plus a Duty Free Showcase ‘shop’, Celestial Bar and lounge area. “The Celestial Bar is in partnership with Absolut and our new First and Business Class amenity kits feature DAVI products, the skincare
72 I THE BUSINESS TRAVEL MAGAZINE
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