The poor shape of European economies in recent years has depressed outbound demand, but travellers from Asia-Pacific have taken up the slack, driving route expansion

Air routes linking Europe and Asia were dominated by European carriers from the 1930s until the 1980s, when Asian carriers burst onto the scene and made great strides. In spite of this, the number of European carriers operating to the Asia-Pacific region continued to spike in the 1990s. With the entry of Gulf carriers, the dynamics on these routes changed dramatically and many European carriers shaved capacity before eventually pulling out.

The dominant European carriers serving the Asia-Pacific region today include Air France, British Airways, Lufthansa and Finnair – all of these except Finnair have gained critical mass and strength through some form of merger, acquisition or consolidation. Finnair, however, has been able to ride on its proximity to Asia (via the Polar Route) and its growing cooperation with Air Berlin. Also included in this report is Qatar Airways, which is a strong operator along the Europe-Asia Pacific air corridor and the first Gulf carrier to join an alliance.

As economies in Europe and the Asia-Pacific begin their upward swing from recent lows, air travel between both continents will once again grow in prominence. The airlines featured will surely be joined by more of their Asian counterparts. Along with these, a new threat in the form of longhaul low-cost carriers will probably begin to gnaw at the incumbents’ load factor and yield.

AIR FRANCE
Network/capacity growth in 2013
Air France added Kuala Lumpur to its route map in April. The thrice-weekly flights from Paris-Charles de Gaulle are operated by a Boeing 777-200.
In terms of capacity to Asia, an average of five per cent growth has been maintained. During the airline’s 2013 summer season, frequencies increased from five weekly to daily for Guangzhou and three to four weekly for Bangkok. Service to Ho Chi Minh City was also adjusted, with four flights weekly operated by a B777-200 instead of three.

Network/capacity growth in 2014
Jakarta will join Air France’s network from March 30, 2014. A continuation of the Singapore service, daily flights will be operated by a B777-300.
Senior vice president, Asia-Pacific, Patrick Roux, said: “Apart from (adding new routes to) Indonesia and Malaysia, we also have our eye on developing Philippines and are growing frequencies for Vietnam.”

Product upgrades
Starting from June 2014, 44 longhaul aircraft will be retrofitted with new premium economy and economy cabins featuring seats with more legroom and wider touchscreens, among other changes. However, it is still unknown which routes in Asia these will be deployed on. The airline also plans to unveil its new business-class offerings and La Première (first class) in January and April 2014 respectively.

Performance
For the first eight months of 2013, load factor hit 86 per cent for Asia-Pacific, a 0.2 per cent year-on-year decrease.
According to Roux, the Greater China market is dynamic. “While there is still a lot of group travel, FIT is growing fast,” he said.
Regional manager for Hong Kong and Macau, Wenchi Wang, added that fly-cruise travel is also on the rise, with the airline launching such packages this summer.

Trade partnership
Air France stirred up protests among agencies in 2010 when it pioneered the zero-commission policy in Hong Kong. However, Wang said: “They are still our key partners and we cooperate closely on different destination packages and a variety of products.”
A series of seminars, fam trips and roadshows are coming up next year for the airline to introduce its new cabin products.

USPs
Air France is the only carrier to serve champagne on longhaul international flights to economy-class passengers. – Prudence Lui

BRITISH AIRWAYS
Network/capacity growth in 2013
British Airways launched thrice-weekly services from London to Colombo and Chengdu in April and September respectively. Both services are operated with B777-200s and come on the heels of six-weekly flights to Seoul-Incheon in December 2012. Frequencies on London-Hyderabad and London-Chennai were boosted by one flight per week in October, the same month one of two daily flights to Hong Kong was upsized to an A380.

Network/capacity growth in 2014
In summer 2014, Seoul-Incheon will receive a seventh frequency per week while the newly launched London-Chengdu route will see a doubling of frequency to six per week.

Product upgrades
In 2013, following the termination of a commercial partnership with Qantas Airways, British Airways’ services to Singapore, Australia and Thailand have migrated to Terminal 5 at Heathrow Airport. This move has vastly improved connection to other cities in the UK and across Europe.
British Airways newest cabin products are also offered on the B777-300ERs that ply London-Singapore-Sydney and on the B747-400 for London-Singapore.

Performance
British Airways’ area general manager, Asia and the Pacific, Jamie Cassidy, declined to disclose the airline’s performance but noted that “more and more business customers are returning to the skies and there is a steady demand for travel to the UK by holidaymakers and students”.

Trade partnership
While the airline sees a steady increase in bookings on its website, many of its customers in China and South Korea continue to rely on support from travel consultants. Cassidy said: “Travel agencies and consultants remain a very valuable channel for us and we continue to invest in our relationships with them. We also regularly work with them to raise the profile of the UK as a tourism destination.”
British Airways’ longstanding Speedbird Club also ensures that its travel consultants in the region have round-the-clock access to its policies, fares and service information.

USPs
British Airways is the first airline to introduce both the A380s and B787 Dreamliners into its fleet, part of a five-billion-pound (US$8 billion) investment in new aircraft, an upgraded cabin and inflight menu, and more intuitive service delivery. The state-of-the-art Terminal 5 at Heathrow is also used exclusively by British Airways and Iberia. – Sim Kok Chwee

LUFTHANSA
Network/capacity growth in 2013
Earlier in 2013, Lufthansa deployed its B747-8 Intercontinental to Hong Kong. In September, the A380 was also operated five times weekly on Frankfurt-Shanghai. It continues to boost capacity through the deployment of larger-capacity aircraft and currently, the A380 is operated to Tokyo, Beijing, Shanghai and Singapore, while the B747-8I, Hong Kong, New Delhi and Bengaluru.

Network/capacity growth in 2014
Starting October 27 and into the summer of 2014, the existing A380 service into Tokyo-Narita will be replaced by the B747-400. In summer 2014, the A380 will replace the B747-8I on the Beijing route, while the B747-400 replaces the A340-600s to Seoul-Incheon and on the second seasonal service to Shanghai. The current Munich-Seoul service operated by an A340-300 will also see a capacity boost through the deployment of an A340-600 six times per week.

Product upgrades
Starting mid-2014, Lufthansa will retrofit its entire fleet of longhaul aircraft with its new  business-class, fully lie-flat seats at a cost of one billion euros (US$1.4 billion). The airline is also introducing its onboard wireless internet service – FlyNet – on its longhaul fleet.

Performance
In the first half of 2013, Lufthansa’s services to the Asia-Pacific have outperformed other routes in its network, with load factors exceeding 80 per cent.
Steffen Harbarth, Lufthansa’s vice president Asia and Pacific, said: “China and South-east Asia in general and Singapore in particular have been strong performers in the region. However, the currency development in many other parts in Asia, especially Japan and India, are challenging.”

Trade partnership
“We have several schemes in place that vary from market to market. In general we are keen to open our own sales tools to our loyal sales partners in order to give them best access to available routes and prices,” Harbarth said, adding that the airline had attracted many new potential partners in emerging markets like Indonesia.

USPs
Precision, punctuality and professionalism. With a whole brood of airlines under its wings, the Lufthansa Group is also able to offer multiple hubs in Frankfurt, Munich, Zurich, Vienna and Brussels as well as its own dense network of intra-European point-to-point connection through or even bypassing busy hubs. – Sim Kok Chwee

FINNAIR
Network/capacity growth in 2013
In June, Finnair launched thrice-weekly services to Hanoi and Xi’an with A330s.

Network/capacity growth in 2014
Finnair’s country manager in Singapore, Nick Naung Naung, would only say that new routes will be announced in due course. He added: “We are always evaluating possibilities to add new routes or frequencies, and we have targeted to double revenues from Asian traffic between 2010 and 2020. This will most definitely entail a vigorous pursuit of new route opportunities.”

Product upgrades
As part of its ‘Design for You’ motto, Finnair’s collaboration with Marimekko Studio involves its tableware, textiles and even a special livery adorning its A340-300s. Besides being more aesthetically pleasing, the new tableware in business class boasts weight savings of up to 20 per cent.
Finnair has also recently relaunched its Signature Menus, taking advantage of Finnish natural ingredients, seasonal vegetables and wild game and fish. These include specialties such as reindeer fillet, and are prepared by well-known Michelin-star chefs who are prominent in Finland’s culinary scene.

Performance
Although load factors have improved on most Asian routes in the first half of 2013, yield remains a challenge for Finnair. In the second quarter of 2013, demand in Asia for its services to Helsinki and Europe actually contracted 2.1 per cent.

Trade partnership
To help travel consultants better sell the airline’s services, Finnair sees the importance of communicating the benefits of its products. Commenting on the airline’s relationship with agencies, Nick Naung Naung said: “These really vary quite a lot by local market and route, but we have regular product updates and product presentations. We also have fam trips (via Helsinki) for selected travel (consultants) to help orientate them around the Helsinki airport and our Finnair products.”

USPs
Finnair’s hub at Helsinki is geographically well placed to connect traffic from Asia to the rest of Europe and North America via the Polar route. Helsinki’s Vantaa Airport is probably one of the most efficient for connections, something which can be consistently accomplished within minutes. The Lapland, billed as home to Santa Claus, will also continue to fascinate families seeking a winter destination with a strong dose of Christmas cheer. – Sim Kok Chwee

QATAR AIRWAYS
Network/capacity growth in 2013
In 2013, Qatar Airways launched services to 11 new destinations. Among them are daily flights between Doha and Phnom Penh in February and Chengdu in September as well as thrice-weekly services to Clark in October. Meanwhile, Yangon’s thrice-weekly service was increased to daily on October 27, while Jakarta welcomed 14 flights a week from September 1, up from 11.

Network/capacity growth in 2014
Qatar Airways’ CCO, Marwan Koleilat, would only say: “Our strategy is to expand our footprint in Asia-Pacific as well as increase frequency on existing routes to offer passengers greater choice.” The region is one of the most significant for the airline.

Product upgrades
Qatar Airways’ most significant product enhancement will be realised when the new Hamad International Airport (HIA) is opened in stages starting end-2013. HIA will initially be able to handle 28 million passengers per annum (mppa) but will grow its capacity to 50 mppa. With unrestricted operation for all aircraft types – including the A380 – HIA will further smoothen the airline’s intercontinental connections throughout the day.

Performance
While it did not disclose performance of its services, Qatar Airways noted that most of its customers from this region travel beyond Doha to final destinations in the Middle East, Africa, Europe, North and South America.

Trade partnership
Koleilat said: “We value the role of travel consultants. They are the experts on the ground with access to the customer, providing valuable advice in a timely fashion. As technology evolves, we will continue to find ways to work closely with our trade partners to deliver value-added services to our customers.
“Travel consultants can play a more active role in helping airlines collect passenger contact information at the point of sale. It is to our mutual benefit for both parties to work together to fulfill the various mandatory government security requirements.”

USPs
Its multi-national cabin crew – many of whom are from Asia – are well placed to cater to the needs of its customers in Asia-Pacific. Its in-flight menus too strongly feature Asian meal options. Most importantly, Qatar Airways’ strength lies in its ability to connect passengers from one plane to another, even when these are parked in remote stands at the existing Doha International Airport.
– Sim Kok Chwee

This article was first published in TTG Asia, November 1 – 14, 2013 issue, on page 6. To read more, please view our digital edition or click here to subscribe.

Additional reporting from Prudence Lui