Air Austral

Vanilla Islands carriers Air Seychelles and Air Austral make capacity cuts

Under what has been dubbed a “restructuring effort”, Air Seychelles has cut 77% of its total seat capacity. Between Nov-2011 and Mar-2012, the airline will cut all routes except for its domestic services, which includes one scheduled service to Praslin Island and a handful of chartered services operated on behalf of hotels, and its twice weekly service to Mauritius. The carrier in Oct-2011 had a restructuring plan, CEO changes and corporate re-branding, which were intended to result in a renewed focus on high-end tourism, as CAPA wrote at the time. Just two months later, the carrier announced deep capacity cuts, suggesting more drastic measures were needed.

Fellow Vanilla Islands Group (an affiliation of the island nations Seychelles, Madagascar, La Reunion, Mauritius and Comoros that are supposed to work together to promote tourism and investment) carrier Air Austral, based in La Reunion, will also make capacity cuts to its long-haul network although it is looking to Asia Pacific and remains intent on keeping its European services operating. Meanwhile, Air Mauritius recently reported an unexpected net loss in its 2QFY2011 results, Air Madagascar can only operate to the European Union through a charter agreement with EuroAtlantic Airways due to its presence on the EU Airspace blacklist, and Comores Aviation only operates a handful of destinations around the Vanilla Islands Group and Eastern Africa. Overall, future prospects for the group look bleak unless collaboration efforts are taken more seriously.

Air Seychelles, restructuring, gets fourth CEO in as many years

Air Seychelles, which has reported its second consecutive year of losses in the FY2010/2011 period, has embarked on a restructuring programme under its new CEO. The carrier is crucial to the Seychelles’ tourism industry and has a renewed focus on the sector. Over half of all air arrivals reach the country on Air Seychelles flights, but the carrier has been struggling in recent years from high fuel prices and rising competition, particularly from Middle Eastern network carriers.

Improving connectivity to Europe is important as most of the island nation’s tourism comes from France, the UK, and as of 2009, Russia. Developing new source markets is vital but has proven difficult, as seen through Air Seychelles’ continuing attempts to establish an Asian hub.

Air Seychelles’ new CEO, Bram Steller, took office on 01-Oct-2011, replacing Maurice Loustau-Lalanne. Mr Steller is the carrier's fourth CEO in as many years.

Europe-Africa routes heavily concentrated across a few points

Africa, once carved up by European powers, retains air links reminiscent of those historic ties. Even so, in too much of the continent, service remains spotty. The CAPA routes tool breaks African searches into four categories: North, South, East and West/Central. But in terms of seat offers available, the real division is between North Africa, those countries bordering the Mediterranean – and everything else. This examination will utilise this format, beginning with everything else.

Etihad Airways' all-economy service another move in addressing low yield markets

Etihad Airways this month announced plans to introduce its first "all economy" class aircraft to its fleet in Oct-2010. This carrier will be the only non-LCC in the Middle East operating such a configuration, although the product bears some similarity to to the ‘Gulf Traveller’ product that CEO, James Hogan, introduced while heading Gulf Air. The purpose is mainly to tap into the high volume but low yielding markets more effectively. This segment is being addressed aggressively by neighbouring flydubai, based in Dubai and, a few kilometres further along the road in the UAE, the highly successful Sharjah-based Air Arabia. Other low cost airlines from outside the UAE are also targeting the UAE markets. Full service airlines around the world have long struggled with the decision whether to adopt a LCC subsidiary or to segment their operation in this way. In each case different considerations apply. Etihad, in treading the middle path, may have got it right in this market.