Quote:
Originally Posted by tuffyy
(1) Its because LH is a star Alliance partner and shares traffic on the AC YYC-FRA route. LH attempted to compliment the YYC route with its own flight but it was dropped due to low yields and over capacity on the route.
(2) BA is at the moment just keeping its head afloat in YYC and the 787 flights should help make the route more profitable, however with AC adding more seats on YYC-LHR with its 77W operations this summer it my well be the demise of BA at YYC.
(3) I think YEG's best bet is to solidify a consistent year round YEG-LHR route with a carrier who will stick to the route (BA).
(4) I believe you will see the YEG-KEF flight move to daily sooner than later as it is proving to be a very popular flight for YEG-Europe connections as a number of people from other cities are also using the route to get to Europe.
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(1) The LH YYC-FRA flight had poor yield for the following reasons (A) LH Business Class was inferior product to AC ExecutiveFirst but LH charged the same price; (B) The LH product mix was too much in the premium products for the Canada market. (C) For an LH route to be profitable it has to sustain F class revenue with paid F load factor of atleast 50% (keep in mind that's only four seats). (D) The only aircraft in LH fleet with an appropriate product mix was the 343 with 42J/222Y, however the 343 operating costs are significantly higher than the 333.
Concurrent with LH pulling out of YYC-FRA, AC dropped their plans to operate YVR-FRA because both LH and AC saw what happens when AC and LH compete (basically LH service loses buckets of passengers). Note this is utilizing LH old product for Business Class, which was lie flat at an angle and intentionally inferior to AC Business Class pods in order to encourage pax to buy up to first. Since the YYC-FRA experiment LH had their come to Jesus moment and have introduced new Business Class seats that is truly lie flat and have also announced new Premium Economy product to place them on par with UA, AC, BA etc.
(2) Agreed that BA is just barely keeping the lights on the YYC-LHR run. However I don't know if this is due to AC or KLM. AC is popular with the Altitude program members (e.g. their frequent flyer base) plus the corporate account network favours AC. However KLM has the advantage in the anyone but AC market.
Another point that favours KLM over BA is with the respect World Traveller Plus vs Economy Comfort products in the premium economy space. WT+ is a separate seat that wider compared to WT class. However EC utilizes the same seat as Y but only offers more legroom. Anytime seat width is expanded there is a requirement for a corresponding increase in base airfare to cover the increased space. KLM can sell EC for much less than BA can sell WT+ and still get superior yield because KLM gets one more pax per row than BA.
AC is in the process of introducing a WT+ style premium economy service. It will be interesting to see if AC PE seat introduction will improve market acceptance of true PE seat.
(3) I know I have said this before on this forum, But I fail to understand how BA could make YEG-LHR work if they cannot sustain YYC-LHR. For YYC-LHR BA has the same problem as LH, too much emphasis on premium cabin revenue.
At the end of the day FI service is doing very well on YEG-KEF because they are significantly cheaper than AC or any other airline combination (e.g. WS-BA, WS-KLM, through multiple points). If this is true, then EIA would be better served with KLM service as they are economy cabin centric airline.
(4) Agreed FI daily service year round is a no brainer. However speaking from pure EIA passenger development perspective, what's next. FI does not have a second wave/bank with which to start second service. Best that FI can do is 10 weekly YEG-KEF or tail swapping with airplane with their sole 753.
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To add something new to the discussion. I would position the next real game changer for YEG-Europe is WS Widebody service. There is a couple of things that make this a game changer.
AC will be more desirous of retaining their LHR slots in the face of possible WS expansion. Therefore they are more likely to retain all possible services rather than let the slot go dormant.
With WS widebody in the mix, its a lot easier for AC marketing to sell AC rouge services into LHR with YEG-LHR as their trial balloon. E.g. what does AC rouge on YEG-LHR do to yields on YVR-LHR and YYC-LHR. Its better to cannibalize the route yourself than give away the route to competition.
The addition of WS on YEG-LHR in conjunction with beyond codeshare services on BA would probably kill off FI.
I also suspect that introduction of WS widebody services to Europe will kill off BA on YYC-LHR.
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