KLM Royal Dutch Airlines

IAG, Lufthansa and Air France-KLM confront short-haul cost options; Air France will be sorely tested

International Airlines Group (IAG) CEO Willie Walsh has indicated that he is fully prepared to meet any opposition head-on in restoring the Group’s short-haul cost disadvantage against Europe’s major LCCs like easyJet and Ryanair, a reference to Iberia’s pilots who have been striking on a weekly basis in protest against recently-established subsidiary Iberia Express operating off a lower cost (and pilot salary) base.

Rather more timidly, Lufthansa recently appeared to confirm it was exploring a “business case” to merge operations of the Group’s lower cost Germanwings subsidiary with the full brand Lufthansa fleet. Germany’s Bild Zeitung reported that a new low-cost subsidiary, project named Direct 4 You, was also being considered.

These reports follow Air France-KLM chairman and CEO Jean-Cyril Spinetta’s recent comments that the company was considering using Air France-KLM Group’s French version of its Dutch subsidiary Transavia as an umbrella for an apparently similar low-cost model to its two major European rivals.

Airlines in transition: Hybrid and low-cost carriers push for better airline-airport relationships

Alex Cruz, CEO of Spanish LCC Vueling, spoke passionately at a recent conference of his need to see partnerships between airports and airlines that are deep and long-lasting. Mr Cruz referred specifically to co-operation that permits both partners to benefit from alternative revenue generation. Ahead of the forthcoming CAPA Airlines in Transition conference in Istanbul – which will feature some 30 airline CEOs addressing this and related issues – we consider how these parties have collaborated in the past and how it is shaping up now.

Vueling Airlines has become one of the innovators of the hybrid/low-cost business model that has become more prevalent and is found in other airlines such as easyJet (progressively) and Flybe (one of the originators of the model).

The fast changing airline industry makes life difficult for airport planners – just as change also offers opportunities.

British Airways/IAG with bmi looks to re-establish world leadership – and long term survival

It can be a fine line between survival and success, just as the blowtorch of a threatened existence provides a powerful motive to pursue ambitious goals.

Last month’s International Airlines Group (IAG)/British Airways move on bmi is only one more piece in the strategic kaleidoscope opening out in front of the Group Chairman, Willie Walsh. The world is his oyster at present. Answering a question following the bmi purchase announcement, Mr Walsh said that despite the uncertain economic environment that Europe’s politicians have created, this was a time of opportunity. His airline is well placed now to capitalise and, as bad news for others spells bargains in the marketplace, the time could well be ripe. In the process, London Heathrow Airport is firmly in the spotlight as Virgin Atlantic also remains a sale possibility. Yet for BA and all of its major rivals, the elephant in the room remains how to service shorthaul network connections profitably.

Emirates and Lufthansa growing strongly this summer: World's biggest airlines rankings for August

Lufthansa and Emirates are the fastest growing carriers of the global top ten, increasing their capacity (ASKs) by 12.4% and 8.1% year-on-year, respectively. Delta remains the world's leading carrier by this measure, followed by American Airlines and United Airlines. Combined, United-Continental is roughly 3.3% bigger than Delta by systemwide ASKs.