As ultra-low-cost carriers and well-financed Middle Eastern airlines continue to expand internationally and capture more global market share, Air France-KLM and British Airways are trying new strategies to fight back with cheap flights.
Air France-KLM just announced it will create a new long-haul operation – it currently calls the project ‘Boost’ – to be based at Paris Charles de Gaulle, as a “response to the Gulf State airlines which are developing at low production costs on key markets where Air France-KLM is pursuing its growth ambition.” And British Airways is mounting a competitive response to Norwegian on a pair of North American routes, using reconfigured aircraft with more seats that will permit lower operating costs. (Note those new nonstops just announced between Oakland & London- resulting in a nice fare war putting cheapest flights in the $500 roundtrip range)
Air France-KLM said that the new company, which will have 10 long-haul planes by 2020, “will propose a simple, modern and innovative offer, whose positioning will not be low cost. It will offer its customers business and leisure destinations with standards comparable to those of Air France in terms of product quality and the professionalism of the crews.” But it said the new operating unit will be “competitive and innovative,” and will serve as a laboratory for new products, technology, catering, cabin design and customer service innovations.
The company said Boost will allow it “to go on the offensive by opening new routes, reopening routes closed due to their lack of profitability and maintaining routes under threat.” It is expected to start operating in about a year, initially focusing on routes to Asia.
British Airways, meanwhile, is focusing on long-haul competition to the U.S. from ultra-low-cost competitor Norwegian. BA recently announced plans to start flying next year to Ft. Lauderdale and to Oakland from Norwegian’s U.K. base at London Gatwick instead of BA’s big hub at London Heathrow. Norwegian already flies both of those routes from Gatwick.
And news came out this week that BA’s new Gatwick routes will eventually use reconfigured 777s that are packed with more seats. According to the U.K. publication Business Traveller, BA plans to increase economy seating in its Gatwick-based 777s from nine-across to 10-across. The aircraft will still offer Club World business class, but with the seat count in that cabin decreased from 40 to 32. The total seat count on the planes will grow from 280 to 332.
BA said the reconfiguration will give its Gatwick-based 777s a lower per-seat operating cost than Norwegian’s 787 Dreamliners.
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