SN Brussels & Virgin Express towards a full merger

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AirDupont
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Post by AirDupont »

to airazurxtror,

I'm quite disappointed in your statement. You just think and care about yourself but what you shouldn't forget is that many people working vor SNBA and VEX would be losing their job when the airline would go down. Are you maybe one of the ex Sabena employees who hasn't found a job in aviation since?

FlyA330
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Post by FlyA330 »

AFApresident wrote:
A full merger of SN and VEX COULD work, however they will need to take some risks and most of all have a leader.
I would like to see that happening. :lol: :lol: After the integration of a little more than 40 Birdy pilots into SNBA the unions and the BeCA were already fighting with the management.... What will happen now when all the VEX pilots and cabin crew will join the SNBA seniority list? Will they go at the end of the list??? or will they integrate according their experience???
This will be a real challenge for the unions, the BeCA and the management.

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Bottie
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Post by Bottie »

AirDupont wrote:to airazurxtror,

I'm quite disappointed in your statement. You just think and care about yourself but what you shouldn't forget is that many people working vor SNBA and VEX would be losing their job when the airline would go down. Are you maybe one of the ex Sabena employees who hasn't found a job in aviation since?

Don't get too personal, the last sentence is too much .......

aocmember
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Post by aocmember »

"handling of vex in bru is still by flightcare"

This only partly correct; pap handling is done by Vex
(ticketing, check-in and boarding),
the rest is done by Flight Care.

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sn26567
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Post by sn26567 »

Some people asked me for my personal opinion. Here it is.

A full merger into a single airline (that would of course keep the SN name: Virgin belongs to Sir Richard who indicated that he would pull out) would increase the weight of SN in the Brussels market. But 40% of the Brussels market for the combined airline is way too low. A home airline should have at least 50% of its home market.

The integration of two airlines is a lengthy process. Neil Burrows said that he would leave in 12 months for "personal reasons". That is too short. He will only be able (perhaps!) to draft a strategy and let others implement it. How will those others react when they are forced to carry out a plan that is not theirs?

In my view, it was a mistake to name a CEO for only 12 months. In 6 months, it will already be time to look for a successor to Burrows, and that will absorb too much energy that could be better devoted to design a long-term plan.

Admittedly, it is not an easy task to find a boss who will be in the difficult position to manage a company that needs to merge different cultures, salary scales, marketing concepts into a strong brand.

That strong brand should be what makes currently the strength of SN: its recognition as a quality airline, even in economy (probably the best economy class in Europe). Therefore, it will be necessary to fill up the planes above the meager 65% current load factor. How? Maybe like SAS with its no-frills class (with the risk to see most passengers downgrade to that cheap section of the plane, like I have seen on my flights to and from Oslo in September last). It might be necessary to find a more imaginative concept. And that's the task of management, not mine...
André
ex Sabena #26567

FlightSimCrew
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Post by FlightSimCrew »

it might be a surprise to many people but SNBA is not known as a quality airline especially not beyond Brussels, even in Africa everybody still calls it Sabena. Thats were the previous management did a very bad job. they did position an airline with succes on the Brussels platform making it sustainable itwards the near future (by realizing small but stable profits thanks to Africa). But this was only being done by neglicting to position the brand throughout Europe. In the same way this is why Virgin Express is not able to enlarge its customer base.. its not known in the destinations it flies to...

I really dont care how the new company if there will be one, will be named but I hope that the new team will see that in order to get respected you need to communicate that you are out there.

Lets be honest we all now SNBA and VEX and we have a good idea what product to expect and indeed its not bad but we are all aviation-people, we work and live around catering, tickets, check-in, distribution, advertising and airplanes and we are all 100%£ subjective to what we think of our airline! We are only a couple of thousand and there are millions of passengers every day using competition. The thing is : in Sabena times their was indeed a larger network and more planes and more connectivity but SNBA has now also a large network, why aren't they able then to get better connecting figures? HOnestly tell the passengers you are flying and you product will convince them !

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Vinnie-Winnie
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Post by Vinnie-Winnie »

To all the dreamers on this forum who wish SNBA would expand by introducing new long haul destinations, I would just like to say forget it! Sabena tried and sadly failed miserably. And why could SNBA not do any better? Because the market SNBA has is still the same as the one Sabena had: Small market of low yielding passengers!

Therefore and unfortunately let’s just accept the fact that SN is now a regional carrier serving Europe from Brussels. OI U might say me isn’t SN serving successfully some African destinations? Well yeah but Air-France-KLM are also entering the market. Therefore should the worse happen well a price war might happen! Sn with its fragile finances will never be able to cope. Before this happens Sn will need to sort out its European destinations otherwise we can only expect the worse again!

That’s why the integration of Vex is not that bad after all. Vex is operated much more efficiently than SN. Let’s hope that SN will take Vex’s example and cut costs as much as it can. I don’t think there should be any sacred cows. As pointed above the benefits that SN employees get are far superior to the once Vex’s employees get. Should SN not align its benefits in line off what Virgin employees get? Should SN not increase the rotations of their planes? At the moment I’m still expecting a convincing answer on whether Avro’s are cheap to run. Anyway even acknowledging the fact that I don’t really know about the efficiency I feel like they don’t particularly offer the flexibility necessary to run an airline. Maybe buy or lease bigger aircrafts.

These few measures could certainly lower costs and permit SN to be a bit more aggressive no?

So in my opinion it is time to be a bit ambitious whilst also not over-expanding blindly. Explore the lower cost alternative like Air lingus does! (quite well I think) Forget about the Business class passengers on European destinations, they just hardly exists nowadays, and focus on economy passengers. by being attractive to all segments of the market I’m sure SN will fare better.
Advertising a 104 Euro all in single fare to Vienna is just ridiculous in my opinion. Better make it a low enticing 60 euros, and gradually move up the ladder as conditions change. Don’t forget there are still quit a lot of passengers around who would not travel to Schiphol or CDG for European flights. But they need convincing. On the other end there is also an endless list of companies and organisations based in Brussels who located there because of its central location and the EC. They will certainly fill the higher priced seats.

To summarize this post, let’s just stop thinking about prestige, and focus on what the customers want!

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SN_fan
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Post by SN_fan »

prestige,aaaah, oooh pretty prestige. Doomed a lot of companies

DannyVDB
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Post by DannyVDB »

Vinnie-Winnie wrote:To all the dreamers on this forum who wish SNBA would expand by introducing new long haul destinations, I would just like to say forget it! Sabena tried and sadly failed miserably. And why could SNBA not do any better? Because the market SNBA has is still the same as the one Sabena had: Small market of low yielding passengers!
I agree that only dreaming and wishing to expand in all directions isn't an option for SNBA.
On the other hand 'small' and 'big' markets do not exist. The market for BRU is not Belgium but covers around 20 million people (Belgium, Northern France, South of NL, Western part of Germany). In fact it is more or less the same as the Paris and Amsterdam area ... The > 40 million passengers in AMS are only partially Dutch people.
What you need is an offer that makes whether or not you will attract people from this catchment and people from further away through your hub (and the latter is clearly what SNBA does not want to develop since for EU flights this is very expensive - KLM has an intercontinental hub which is quite different).
Vinnie-Winnie wrote:
That’s why the integration of Vex is not that bad after all. Vex is operated much more efficiently than SN. Let’s hope that SN will take Vex’s example and cut costs as much as it can. I don’t think there should be any sacred cows. As pointed above the benefits that SN employees get are far superior to the once Vex’s employees get. Should SN not align its benefits in line off what Virgin employees get? Should SN not increase the rotations of their planes? At the moment I’m still expecting a convincing answer on whether Avro’s are cheap to run. Anyway even acknowledging the fact that I don’t really know about the efficiency I feel like they don’t particularly offer the flexibility necessary to run an airline. Maybe buy or lease bigger aircrafts.
I doubt whether VEX is more efficient! If you would have a look at profits/losses over the last few years, I think VEX did not perform very well, even with high load factors. And they are not always much cheaper as compared even to SNBA.
About the so called benefits of the SNBA pilots: on of the differences is the contribution to the (additional) pension funding. I think that in view of what is going on in the field of social security, it might be even better to foresee this for the VEX pilots too!
Vinnie-Winnie wrote:
So in my opinion it is time to be a bit ambitious whilst also not over-expanding blindly. Explore the lower cost alternative like Air lingus does! (quite well I think) Forget about the Business class passengers on European destinations, they just hardly exists nowadays, and focus on economy passengers. by being attractive to all segments of the market I’m sure SN will fare better.
Advertising a 104 Euro all in single fare to Vienna is just ridiculous in my opinion. Better make it a low enticing 60 euros, and gradually move up the ladder as conditions change. Don’t forget there are still quit a lot of passengers around who would not travel to Schiphol or CDG for European flights. But they need convincing. On the other end there is also an endless list of companies and organisations based in Brussels who located there because of its central location and the EC. They will certainly fill the higher priced seats.
I agree that SNBA as VEX does often could offer more very low prices. I personally think that a clear and fixed system could do (I saw it in Germany with one of the LCC): e.g. 25-30% of all the seats for 99 EUR return including taxes. The higher fares would give you more felexibility and since SNBA will always have a lot of business passengers of all kind, they would also be able to sell these like they do now ... I hope that their new pricing polisy they've anounced is going in this direction ...

Regards,
Danny

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Atlantis
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Post by Atlantis »

@Vinnie-Winnie,

Dreaming about expansion on long-haul is no longer foolish, but reality. Staying at this current position is worser than take some risks. On Europe they are flying in red figures even in codeshare, could you believe that.

You said Air France-KLM entered the African continent. Wrong, they are already there with a strong African partner. If SNBA don't take action it's clear that also serving Africa is not good enough.

Like someone else said our market is not so small. Belgium take some pax from our neighbours countries. SNBA has also feeder flights from Scandinavia for the Africa flights.

As a good businessman you have to taste the market and want to take some risks and not staying at your current position (in that case you are satify with your bad situation). Look at the new flights of Abu Dhabi and Toronto: they are very good and are almost full. At this moment the TC are asking for one more flight. SNBA is only a codeshare partner and could give only give some pax, but the situation could be different if SNBA was flying those route with Etihad as a partner. In that case Etihad could give some pax in Abu Dhabi. On this route for the moment no competition: bad for SNBA because they don't took the risk. And what if Etihad wants to use bigger metal and fly directly to Toronto. In that case they don't need SNBA anymore.

At this moment, the big companies in Flanders are bagging for direct flights to Japan. There must be an aircraft who is fuel efficient, good maintenance cost, on the market to fly from Belgium to Japan. And it don't has be a 300 seats aircraft. Start smaller.

airazurxtror
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Post by airazurxtror »

AirDupont wrote:to airazurxtror,

I'm quite disappointed in your statement. You just think and care about yourself but what you shouldn't forget is that many people working vor SNBA and VEX would be losing their job when the airline would go down. Are you maybe one of the ex Sabena employees who hasn't found a job in aviation since?
Without any bad feelings, I would like to answer :
- I am not an ex-Sabena employee; quite at the the contrary, I am an ordinary Belgian taxpayer, who, with all the others, has paid the losses of Sabena, for 40 years running.
- I love to fly, but I have always had to pay my ticket myself : nobody picks up the bill for me, I don't travel on expenses, and I don't get free tickets like airline employees. I am not rich either, which explain why I am cost-sensitive and a fan of LCCs.
- I certainly don't wish the SNBA and Virgin Express employees to lose their jobs; I fly from time to time with Virgin, and I would like to fly with SNBA if I could afford their fares; on the other hand, several thousend companies fold up or are bankrupt each year in Belgium : not competitive, badly managed, etc. Such is life !

-

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Vinnie-Winnie
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Post by Vinnie-Winnie »

DannyVDB wrote: On the other hand 'small' and 'big' markets do not exist. The market for BRU is not Belgium but covers around 20 million people (Belgium, Northern France, South of NL, Western part of Germany).What you need is an offer that makes whether or not you will attract people from this catchment and people from further away through your hub (and the latter is clearly what SNBA does not want to develop since for EU flights this is very expensive - KLM has an intercontinental hub which is quite different).
Let's take the 4 areas you mentioned and a specific example for each:

Lille: Less than one hour from CDG by train, which offers many more destinations and flexibility than BRU does or ever will.
Koeln: on average one hour to FRA and once again many more connections.
Breda: Soon to be about 40 minutes with once again more and better connections.

That doesn't look good for BRU does it? Even with a big network including many destinations and plenty of frequencies people will still prefer their national carrier anyway. So yeah that doesn't look good.

And look again at Air-France KLM they offer cheaper prices for long haul destination from Brussels including a train journey than they do for their own market. That definitely shows that it will be double hard for SNBA to introduce long haul destinations.


DannyVDB wrote:I doubt whether VEX is more efficient! If you would have a look at profits/losses over the last few years, I think VEX did not perform very well, even with high load factors. And they are not always much cheaper as compared even to SNBA. About the so called benefits of the SNBA pilots: on of the differences is the contribution to the (additional) pension funding. I think that in view of what is going on in the field of social security, it might be even better to foresee this for the VEX pilots too!
I don't really mean profits or necessary cheaper fares when I call for more efficiency. I just want SNBA to lower its costs by cutting admin jobs, by reducing the inefficiencies that might arise, basically calling for a kind off lCC cost structure. Even if it means banning staff from charging their mobile phone at home, so be it! Better save money before it is too late. How do U want to reduce costs if U give perks to everyone? Absolutely impossible. It's not a nice world unfortunately, and since the average cost of employing someone is god damn high in BE, U got to save money where U can. It's not by giving out additional benefits that SN will become competitive!
Atlantis wrote:Dreaming about expansion on long-haul is no longer foolish, but reality. Staying at this current position is worser than take some risks. On Europe they are flying in red figures even in codeshare, could you believe that.
It's wrong in the sense that Sabena tried it and failed. We don't want to have such a disaster again do we? Risk with a high probability of failure is just plane silly, especially when your finances are weak!
Atlantis wrote:As a good businessman you have to taste the market and want to take some risks and not staying at your current position (in that case you are satify with your bad situation). Look at the new flights of Abu Dhabi and Toronto: they are very good and are almost full. At this moment the TC are asking for one more flight. SNBA is only a codeshare partner and could give only give some pax, but the situation could be different if SNBA was flying those route with Etihad as a partner. In that case Etihad could give some pax in Abu Dhabi. On this route for the moment no competition: bad for SNBA because they don't took the risk. And what if Etihad wants to use bigger metal and fly directly to Toronto. In that case they don't need SNBA anymore.
As a good businessman you got to know the market and know how to get a decent return on it.
Yeah difference is Etihad has deep pockets and is only stopping in Brussels to refuel. The codeshare agreement only consolidates Etihad revenues quit easily. They have the money to match their ambitions, which SN doesn't have and will never have. U can't compare both together I'm afraid.
Atlantis wrote:At this moment, the big companies in Flanders are bagging for direct flights to Japan. There must be an aircraft who is fuel efficient, good maintenance cost, on the market to fly from Belgium to Japan. And it don't has be a 300 seats aircraft. Start smaller
What do these companies want: Frequent rotations to Japan. Could SNBA sustain a 5 weekly flight to Tokyo? Probs not so SN will never be able to capture the whole market which is already so small! Doomed Idea from the start!

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Post by Atlantis »

Vinnie-Winnie wrote:Let's take the 4 areas you mentioned and a specific example for each:

Lille: Less than one hour from CDG by train, which offers many more destinations and flexibility than BRU does or ever will.
Koeln: on average one hour to FRA and once again many more connections.
Breda: Soon to be about 40 minutes with once again more and better connections.

That doesn't look good for BRU does it? Even with a big network including many destinations and plenty of frequencies people will still prefer their national carrier anyway. So yeah that doesn't look good.
We all know that BRU is in the middle of some big neighbour airports like FRA,CDG and AMS. But what Danny was saying is correct. BRU received pax from our neighbour countries. And even more, KLM will increase the flights to BRU, Lufthansa will also increase the flights from MUC to BRU. That's nothing to neglect.

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Post by DannyVDB »

airazurxtror wrote: - I love to fly, but I have always had to pay my ticket myself : nobody picks up the bill for me, I don't travel on expenses, and I don't get free tickets like airline employees. I am not rich either, which explain why I am cost-sensitive and a fan of LCCs.
- I certainly don't wish the SNBA and Virgin Express employees to lose their jobs; I fly from time to time with Virgin, and I would like to fly with SNBA if I could afford their fares; on the other hand, several thousend companies fold up or are bankrupt each year in Belgium : not competitive, badly managed, etc. Such is life !

-
Hi Airazurxtror,
I can understand that you chose LCCs because you want to travel and have to pay yourself ... But want to give some thoughts:
- you can often find good fares with LCCs, but also at SNBA or VEX, or Thomas Cook or JetAir, or ... Just need to plan.
- second: I am always amazed by what people expect - flying almost for nothing while they spend a lot for hotels, ... - I know a lot of people from Africa, Turkey, ... that earn a lot less and for which travelling each year is a normal thing (and they do not have LCCs). I just mean: what's the value of things?

Regards,
Danny

DannyVDB
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Post by DannyVDB »

Hi vienni-wienni,

On your reply regarding the 4 chatchments, you give the wrong examples. You can calculate the number of potential clients with special software - I was referring to that - and in that way there is no difference between the four cathchments. Overall, the BRU catchment is not smaller then surrounding catchments. You should not only refer to Lille, but also to Valanciennes, Metz, Luxembourg, Maastricht, ... Even for Köln (especially the west), it is as easy to reach Brussels as it is to go to Frankfurt. Question is why people should chose to go to - say Bologna - from FRA instead as from BRU ...

Situation for BRU is not so bad as we might believe, especially since it will be better contected by train in the future (to the east this is already partially true).

Of course this does not mean that there is already a hub, but this could be developed ...

On the efficiency I am not very convinced neither since I am not sure that SNBA is 'spoiling' money. Each airline could do better of course. On the other hand giving incetives like the bonus last year or a good salary can stimulate staff to to a better job, and that is one of things appreciated in the attitude of SNBA staff, at least from my side as a frequent user of SNBA ... The cost of salaries is indeed high in BE, but higher in DK, SE, DE, NL and a lot of other countries. Does that prevent them having a dynamic airline or even more then one? On the use of planes you were right ... but I think they are trying to use planes more intensively. Adding an additonal frequency is not always a solution since you need still to fill the planes with pax ...

bravo767
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Post by bravo767 »

About seat occupancy, it is usually on the long haul that the companies have their highest number. AF has an overhaul occupancy close to 80% with a mere 66.6% for Europe. Usually middays flights are quite empty versus morning and evening but you still have to offer alternatives to your customers....
So, keep Europe as a feeder and try to expand to new profitable markets.
Happy landings

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1V1
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Post by 1V1 »

Why would someone prefer Lufthanza,KLM/AF, BA? Answer: for the WORLDWIDE network and the Miles. I don't mind to hop to AMS,FRA or CDG if I can get direct to my destination from there.

AirDupont
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Post by AirDupont »

Now how about the fares Air France is launching? They have really sharp prices. I don't know if you guys have seen the Africa 585€(including train from BRU-CDG) ; but don't you think passengers travelling to Africa will be happy to travel AF for this price? Has the price war began?
This is really not good for SN's future...

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Post by vc-10 »

If there is a train from BRU to CDG, how about putting SNBA pax on it aswell?
I don't know about engines, but SN, AF, LH and KLM all fly A330s in some form. These are very economic apparently, so these should give simmilar costs. Why are SNBA's routes less profitable? Because they use tiny Avros on European routes, with only a few A319s. KLM is huge, despite Holland being quite small. SN need to build their european route structure, to connect with the African flights. I am perfectly happy to transit through Brussels, if it saves me a bit.
I belive that BA are one of the most profitable airlines in the world, yet their short haul routes frequently operate at a loss. True, they fly 734s and 735s on some routes, and they would be better off with some A319s, but Passengers connect for long haul. On my flight to Cayman, 20% of passengers were not British or Caymanian, so I presume they were transit pax. (though ba have the only flight from Europe to Cayman, the flight is via the Bahamas and 85% of pax got off).
Finnair also transits a lot of pax though Helsinki.

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SN_fan
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Post by SN_fan »

AF has a TGV with flightnumber from BRUSSEL-MIDI I think but not from the airport I think
And SN had a Thalys From Paris but it seemed that the passengers didn't appreciate that so now they have a flight BRU CDG operated by axis airways

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