Air Austral

European woes force changes for the better at Indian Ocean carriers, with Air Austral the latest

Hardest hit from the European economic situation, aside from the carriers that have collapsed, are far away from continental Europe in the Indian Ocean, which contains the self-proclaimed Vanilla Islands grouping of countries: La Reunion, Madagascar, Mauritius and Seychelles. These nations' carriers are largely dependent on European leisure traffic, which has evaporated in the dual threat of weakening economies and high fuel prices that provide no stimulation to whatever demand is left.

The starkness of the situation has been demonstrated most recently by Air Austral, which over the northern winter will reduce its long-haul network to a single destination and will postpone – or possibly cancel – its order for two Airbus A380s, following it being unable to pay for a new Boeing 777 awaiting delivery. Air Austral is also looking to partner with Air Mauritius to maintain a connection to Australia, a further sign that the situation in Europe is forcing the Vanilla Island carriers to make medium/long-term strategy changes that will finally strengthen them. Etihad Airways earlier this year acquired a stake in Air Seychelles and is now lending management oversight to the Seychelles flag carrier while the region's other carriers have conducted overdue network reviews.

A380 operators finding configuration sweet spot as value halo persists

When the latest A380 delivery to China Southern occurs at the beginning of March, there will be 70 Airbus A380s criss-crossing the globe. With close to 30 more expected to be delivered over the year, the in-service fleet will approach 100 by the end of 2012.

This year, two new operators – Thai Airways and Malaysian Airlines – will join the existing seven airlines family of A380 operators. Airlines are still finding the sweet spot in terms of A380 seating but more and more configurations are edging above 500 seats, after much experimentation.

Air Austral back to Bangkok, Sydney and Noumea after Etihad-Seychelles partnerships frees capacity

Air Austral’s decision to reverse its suspension of Bangkok, Sydney and Noumea services comes shortly after Etihad Airways and Air Seychelles signed a strategic partnership, including Etihad taking a 40% stake and injecting USD45 million into the cash-strapped national carrier of the Seychelles. Prior to the Etihad agreement, Air Seychelles had reached an agreement with Air Austral for the La Reunion-based carrier to operate twice-weekly service from the Seychelles to Paris CDG.

That capacity deployment was due to commence on 27-Mar-2012, right after the 26-Mar-2012 suspension of twice-weekly Reunion-Sydney-Noumea service and shortly after the 20-Mar-2012 suspension of the weekly Bangkok frequency. Air Austral cited high fuel prices and unfavourable economic conditions.

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.