The future of Brussels Airlines with Lufthansa

[NCB]

It is now official, Lufthansa bought Brussels Arilines.

To me, it's a huge relief as I was concerned about SN's short term survivability in this very hostile climate of high fuel prices, hot competition and market consolidation through numerous mergers and buy-outs.

Now that Brussels Airlines has a strong owner it can rely on, let's discuss how Lufthansa will change Brussels Airlines.
There are numerous subjects to discuss:

-Fleet and routes: more longhaul aircraft? shorthaul replacement? Frequencies between BRU and Germany?
-Hub: how much growth potential is there at BRU?
-Operations: synergies from routes to maintenance and flight crew training
-Strategies: what will become of Air DC? How will they compete against Easyjet?
-Jobs: how is the Lufthansa merger going to affect Brussels Airlines and other staff?
-Product: Will Lufthansa change Brussels Airlines on-board products?

-Alliance: Brussels Airlines is joining Star Alliance shortly
-How will this affect Brussels Airlines?
-How will this affect other airlines?
-Can new airlines be expected at BRU?


An exciting day for Belgian Aviation!

[pijaleu]

It's way too early to know what will happen, but I don't expect a lot of changes in the near future.
The main effect are on code share level I guess.
Now SN is code sharing with BA, which probably will be replaced by British Midland.
I have my doubts on American Airlines (One World member), but maybe this will be switched also?
Alitalia (Skyteam) will end naturally and might be taken over by Air Dolomiti or SN-metal.
Finnair (One World) will probably end. SN allready flies to the Northern-European destinations,so I don't expect any changes there (maybe an extra flight on SN metal)

As long as Jet Airways doesn't enter an alliance, I think code shares will stay (or was Jet in talks with an alliance allready? I don't remember).

I don't know if there is any room for new carriers to fly to Brussels. Many are decreasing flight frequencies.
Maybe there is some Star Alliance carrier who will fly to FRA or Munich and then fly on to BRU to spend the day (like Ethiopean does)?

If LH will use BRU as their African hub, they will need extra planes I guess. Star Alliance only has South African and Egyptair as African airlines.

But it's all a guess and we will have to wait and see.

Kind Regards,
Pijaleu

[itami]

There are numerous subjects to discuss

Indeed NCB. I'm afraid all these subjects will soon be too much for just one topic. Soon each subject might need to be discussed in seperate topics. At least let's hope so !

[beaucaire]

There are serious chances that the aborted DC Air project could be re-visited ??
Maybe not with Hewa Bora but with different partners and not neccessarily out of Kinshasa..
The idea in itself-a serious and reliable Inter-African regional airline,does still make sense to me.

[Conti764]

What I see happening:

For SN:

- More long haul material to fly to Africa and some select destinations in other parts of the world.
- Short haul fleet replacement.
- More streamlining with the other *A-partners in Europe.
- I might see an A350 for SN in the future to operate to Africa. Maybe the 787 comes in the picture as well, but since their entire long haul fleet is Airbus, that is highly doubtful.

For BRU:

- The return of some old airliners (SQ, TG,...) and some new (ANA,...) especially if the African gateway develops well.

- I see some development at the North-American market:
-> The JFK-BRU-JFK rotation by AA will almost certainly disappear since it only came at the request of SN. It will be replaced by a second CO EWR-BRU-EWR rotation, bringing two daily flights by CO (772 + 752 or maybe 762) at BRU.
-> Maybe the ORD-BRU-ORD rotation by AA will survive, but since UA offers the same destination, I have my doubts about it. One change might be that UA, in stead of flying ORD-IAD-BRU-IAD-ORD with 772 might split these flights into two flights probably scaling down (2 x 763).
-> In the future, UA might also connect BRU with the west coast trough their hub at SFO, so I can see a third UA flight in BRU.
-> If the African gateway develops really well, CO might start a flight from their Southern US hub at IAH.
-> US may stop switching between 752 and 762 on their PHL-BRU-PHL rotation and deploy a 762 at the route permanently and maybe on a daily base.
-> Maybe SN can operate one or two flights (maybe connecting two N-A cities in the same flight) to the USA on their own. BOS would be a very good addition. These flights might be flown with 332.

[LX-LGX]

To me, it's a huge relief as I was concerned about SN's short term survivability in this very hostile climate of high fuel prices, hot competition and market consolidation through numerous mergers and buy-outs. Now that Brussels Airlines has a strong owner it can rely on, let's discuss how Lufthansa will change Brussels Airlines. There are numerous subjects to discuss:
-Fleet and routes: more longhaul aircraft? shorthaul replacement? Frequencies between BRU and Germany?
-Hub: how much growth potential is there at BRU?
-Operations: synergies from routes to maintenance and flight crew training
-Strategies: what will become of Air DC? How will they compete against Easyjet?
-Jobs: how is the Lufthansa merger going to affect Brussels Airlines and other staff?
-Product: Will Lufthansa change Brussels Airlines on-board products?
-Alliance: Brussels Airlines is joining Star Alliance shortly
-How will this affect Brussels Airlines?
-How will this affect other airlines?
-Can new airlines be expected at BRU?

Most answers to your questions have already been given in the other topic "Lufthansa acquiring Brussels Airlines".

viewtopic.php?f=7&t=37823

[NCB]

LGX, I am aware of that, thank you. This is also why this thread has been opened in "Civil Aviation" instead of "Latest News".
The idea is that the other thread is getting too long (over 165 posts) and difficult to discuss. A single thread is justified when following the developments of a single event, ie in this case "LH targetting SN".Now that the buy-out has happened and that that thread is going in 3000 directions I thought it would be best to reiterate the main questions and start it from there.

To get back on-topic,

I mostly agree with CO764's analyse of the transatlantic market.

Following the addition of SN to STAR I also think that US will be sending A332's as soon as they start being delivered next year. With SN's feeding and US'es later departure in the early afternoon to PHL, I see that happening.

I can also think of ANA sending one of the early Dreamliners on BRU-NRT and codeshare with SN. SN's feeding will provide with enough traffic.

Of importance is then a railway station within BRU linking to high speed tracks East to Germany, North to Amsterdam, South to Paris.

I am curious about the AIR DC project. Now that LH is in charge, I don't think that Hewa Bora would be involved. Stiill, the idea of a hub in Africa makes sense and as was pointed out, the idea of a safe and reliable airline has a strong potential.

About the Avro replacement: I suspect Lufthansa will send the old B733's and B735's to SN to replace the Avro fleet wih more efficient material with a slightly higher capacity that they would have gotten rid of anyway. That, until the C-series arrive around 2013-2014.

For longhaul, LX is getting rid of 9 more A332's from 2009 when the A333's get delivered. SN could use every single of them.

[sn26567]

I do agree with NCB's argument in favour of a new thread. That's why I did not merge it with the previous one.

About the Avro replacement: I suspect Lufthansa will send the old B733's and B735's to SN to replace the Avro fleet wih more efficient material with a slightly higher capacity that they would have gotten rid of anyway. That, until the C-series arrive around 2013-2014.

Lufthansa (CityLine) itself has an important fleet of Avro's (including D-AVRO) and is not looking for their replacement. Why would they want to replace SN's Avros?

Lufthansa is pumping 65 million euros into SN. Two thirds of that amount (40 million) will serve as an extraordinary dividend for the current shareholders of SN Airholding, but the rest could be invested in the leasing of further planes for SN, without getting them out of the LH fleet.

For longhaul, LX is getting rid of 9 more A332's from 2009 when the A333's get delivered. SN could use every single of them.

Aeroflot will lease seven of those 9 ex-Swiss A330-200s as of 2009. That leaves only two for any other candidate.

[BrightCedars]

I expect the synergies for SN (and thus LH) to be in the tens of millions of Euros. Most systems at LH are built for a large scale operation and are already used by several operators, it wouldn't take much to incorporate tiny SN's workload and most systems would probably not even required increased capacity and processing power.

A bit as if Wallonia was joining France, it wouldn't be very hard for systems that support 60M citizens to support an increase of 3.5M or about 6%.

[tolipanebas]

Brussels Airlines and Lufthansa are said to have defined 5 strategic priorities to work on over the next 2 years.

-) make the European network profitable by increasing its load factors from the extra connectivity SN will offer the LH group. Expect SN to get some of the European transfer traffic which is now handeled by LH or LX and for which it can offer shorter and faster alternatives at superior seat-mile costs (e.g. UK, Holland or Norway to France, Spain, Portugal and Morocco), thus boosting the loadfactors on SN's European network.

-) grow further on Africa and on other long haul routes.

-) reduce the cost through synergies.

-) add new partnerships with other airlines through the integration of SN into STAR ALLIANCE.

-) make SN and LH an outstanding team by making Miles&More the frequent flyer program of SN.

[Andries]

About the Avro replacement: I suspect Lufthansa will send the old B733's and B735's to SN to replace the Avro fleet wih more efficient material with a slightly higher capacity that they would have gotten rid of anyway. That, until the C-series arrive around 2013-2014.

Lufthansa (CityLine) itself has an important fleet of Avro's (including D-AVRO) and is not looking for their replacement. Why would they want to replace SN's Avros?

Lufthansa is pumping 65 million euros into SN. Two thirds of that amount (40 million) will serve as an extraordinary dividend for the current shareholders of SN Airholding, but the rest could be invested in the leasing of further planes for SN, without getting them out of the LH fleet.

18 Avro's operated by Lufthansa CityLine.
20 Avro's operated by Swiss.
5 Avro's operated by Air Dolomiti.

That makes a total of 43 Avro's. As you know, Lufthansa has already signed a letter of intent to buy 60 Bombardier C-Series. So if I didn't forget another small airline owned by LH, that leaves 17 C-Series, assuming they are not meant for expansion. I easily see them putting those into service with BruAir, replacing 17 of the 30 Avro's. The other avro's might be replaced by 733's that LH want's to get rid off as they receive their brand new 320's. Would be logical as BruAir already operates the 733.
Offcourse, they can also add some frames to the LOI. Who knows ...

Greetz,

Andries

[NCB]

Aeroflot will lease seven of those 9 ex-Swiss A330-200s as of 2009. That leaves only two for any other candidate.

Interesting piece of information. Is it a rumour or a sure fact?
I thought that SU were going for lease of 10 new A330-200's through Aercap and with new A350XWB's.

Is that part of interim lift to cope with B787 delays? Surely it'd be cheaper to extend the leases on the B763ER's instead of short-term leasing the A332's??

Why would they want to replace SN's Avros?

Aren't the leases on the Avros expiring soon?
I suspect LH owns the B737's they are getting rid of. That would mean Lufthansa using owned aircraft to save on lease with the advantage of using the B737's, that are more efficent and have more capacity.
That'd kill 3 Birds with one stone.

[Avro]

First of all congrats to SN !! I'm very happy with this news !!

Concerning the maintenance of SN's aircraft, isn't it bad news for Sabena Technics ? I suppose the maintenance of the 737's, A319's and A330's will now be performed by LH Technik ?

Concerning the move from Privilege to Miles&More: Does someone has a guess how they will convert the points ? 1:1 ratio ?

Greetz

Chris

[BrightCedars]

I don't think the Avro's are the aircraft that need most urgent replacement. The problem of the SN European fleet is that it lacks options below 86 seats. Now I don't know if it's very economical to fly a 50 or a 70 seater these days, but given that it provides a competitive advantage on business routes with added frequency from which you can extract a premium and more high yield traffic, there must still be a good business case.

I think this is where SN needs to fill a gap first. The introduction of some smaller modules will allow them to free up the next larger module to increase frequency on other routes, etc, etc.

Also, having both the B737 and the A319 in a fleet when you have 20-50 of each isn't a problem, but it becomes one when you have less than a dozen of one and a mere four units of the other. This is a place where rationalization is needed in order to make savings, although it may not be that urgent as these few units are now virtually joining a much bigger fleet so the volume savings will be there for the most part. Still some of the B737s are aging and could need replacement.

The expansion of the long-haul fleet is the most interesting part, with an odd fleet of 3 + 1 differently powered early builds, it may be a good idea to roll the entire fleet to newer units. I believe the A330-200, A330-300s and perhaps A340-300Xs (for longer legged trips) may be a winning combo until next generation aircraft are available and a choice is made at group level. Read if LH chooses the B787 or the A350 or both, this is what LX and SN will be allowed to get.

As far as Miles&More goes we'll see what the exchange rate will be, this integration might be one of the first to happen once the stake is effectively taken as it will be a step towards accessing Star Alliance. What I sure think is that if you want to trade your various Delhaize vouchers for miles or vice-versa, you should do it rather soon because these partnerships may not survive the switch.

[euroflyer]

18 Avro's operated by Lufthansa CityLine.
20 Avro's operated by Swiss.
5 Avro's operated by Air Dolomiti.

That makes a total of 43 Avro's. As you know, Lufthansa has already signed a letter of intent to buy 60 Bombardier C-Series. So if I didn't forget another small airline owned by LH, that leaves 17 C-Series, assuming they are not meant for expansion. I easily see them putting those into service with BruAir, replacing 17 of the 30 Avro's.

You forgot eurowings: currently (according to their website) 15 BAe 146's (-200 and -300). So assuming LH will really buy those 60 C-Series and assuming they are meant to replace the AVRO's and BAe's, not many will be left for BruAir.

However, LH seems to be in love with the CRJ's of Bombardier, operating a big number of 200s, 700s and 900s. From a pax point of view those aircraft are just horrible, but the operating costs seem to be very low. So maybe some CRJ 200s or 700s are an option for SN as well, especially regarding the European routes with so far rather low load factors?

[JOVAN]

As far as Miles&More goes we'll see what the exchange rate will be, this integration might be one of the first to happen once the stake is effectively taken as it will be a step towards accessing Star Alliance. What I sure think is that if you want to trade your various Delhaize vouchers for miles or vice-versa, you should do it rather soon because these partnerships may not survive the switch.

LH Miles & More has become a tricky loyalty programme.

Since I got Senator status about a year ago, it looks to me as they do everything to make you angry.

- seats (I fly economy) : almost systematically in the back of the aircraft, a few times on a seat that could only recline partly;
- when you ask a seat more in the front (via travel agent), like 3 or 4 days bedfore the flight,they first tell him all seat are allocated already; only after you get angry they find a solution;
- the lounges are always overfull in FRA, sometimes you are better off in business class lounge;
- when I wanted to use my miles to obtain a ticket for my wife, they proposed a route via-via-via, which took 23 hours iso 14 with the direct flight; then they said: OK you can have the direct flight but you pay 50% more miles;
- this was not the end yet; the Miles & More girl called me back to say that this "Premium" system was only valid if I travelled together with my wife.


I call this stealing of miles. Dirty tricks.

At no point in time they made a counter-proposal .

They only keep repeating extra cost for this, extra miles for that...

LH is good , but they must have a problem with their loyalty-programme; its probably too successful, in the sense that it costing them too much.

Anybody a similar experience ???

[Andries]

You forgot eurowings: currently (according to their website) 15 BAe 146's (-200 and -300).

Right ! With the 15 Avro's of Eurowings and the previously mentioned Avro's we get a total of 58 aircraft. Looks like the 60 C-Series are spoken for indeed. Maybe we'll see them adding 30 airframes to a total of 90 as they firm up the order ? We'll see.

Concerning the maintenance of SN's aircraft, isn't it bad news for Sabena Technics ? I suppose the maintenance of the 737's, A319's and A330's will now be performed by LH Technik ?

It is possible in the long term, but I don't think they will put everything in the hands of LH Technik just yet. Currently they have their hands full, especially with the Indian invasion each morning. Anyway, I'll be keeping an eye on this situation, as this can severely influence my future ...

Greetz,

Andries

[Airbus330lover]

Perhaps some A32X to find by AZ ?

[AirDupont]

Too bad they don't have A330's in their fleet....

[Conti764]

Too bad they don't have A330's in their fleet....

Yep, the AZ fleet is actually totally the opposite of SN. The short haul fleet is all Airbus (whereas, accept for the Avro's, SN has more Boeings) while their entire long haul fleet is Boeing (in contrary to SN's 4 A333...)