DOCSLIB.ORG

How the Business Case for Premium Economy Stacks Up

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
How the Business Case for Premium Economy Stacks Up Tronos Aviation Consulting Inc. PEI, Canada / Atlanta USA / London UK Demystifying the Commercial Air Presented by: Transport Seat Gary Weissel Managing Officer Market Tronos Aviation Consulting MARCH, 2017 LOS ANGELES, CA Agenda 1. Understanding Commercial Air Transport seating 2. Interiors industry key players 3. Major trends shaping the seat market 4. Challenges & Opportunities of the aircraft seat market 2 Understanding Commercial Transport Aircraft Seating 3 Complexity of Aircraft Seating 4 Why are seats so critical to airline success? IT’S ALL ABOUT REVENUE GENERATION . Distinguishes Airline Brand . Is the Primary Passenger “Touch Point” . Impacts First and Lasting Passenger Impressions . Can Drive Customer Loyalty . Supports Marketing Initiatives 5 Seat Market segmentation Premium Value LCC ULCC Carriers Carriers Carriers Carriers International International First , Premium Economy Business, Premium Economy Long Business, Premium / Domestic First Economy & Economy & Class & Economy Haul Economy Economy Domestic First Business & Premium Economy Medium Premium Economy Premium Economy & Economy & Economy Economy Haul & Economy Domestic First, Domestic First, Ultra light weight Short Premium Economy Premium Economy Economy & Economy Economy Haul & Economy Domestic First & Domestic First & Ultra light weight Economy Economy Regional Economy Economy Source: TAC Analysis 6 Seats must meet two (2) levels of certification . Seat assembly certification - Technical Standards Order – TSO-C127(b) . Installation certification - Type Certificate (TC) - Supplemental Type Certificate (STC) 7 Seats for new delivery aircraft can be purchased in one of two ways… . Buyer Furnished Equipment – purchased by the airline and delivered to final assembly line . Seller Furnished Equipment - Purchased by aircraft OEM 8 Why do airlines upgrade their seats? . Product obsolescence . Market positioning . New routes / markets . Branding changes . Fleet commonality . New fleet types 9 SECTION 2: Seat Market Outlook 10 Ten Year Global Air Transport Fleet Growth Compliments of: 40,000 North America 38,100 CAGR Asia Pacific Europe 4.1% 35,000 Latin America 6% Middle East 5.0% Africa 8% 30,000 28,000 3.4% 5% 23% 25,000 8% 2.4% 20,000 25% 4.8% 15,000 33% 28% 10,000 25% 1.3% 5,000 30% 0 3.2% Avg. 2016 2026 11 Ten Year Commercial Air Transport MRO Growth Demand Compliments of: $USD Billions Modifications $100.6B CAGR $100 Airframe 5.2% Line $90 Component 12% 2.8% $80 Engine $67.6B $70 16% 3.2% $60 14% 22% 4.2% $50 17% $40 22% $30 41% $20 4.5% 40% $10 4.1% Avg. $0 2016 2026 12 Ten Year Interiors Commercial Air Transport MRO Forecast $USD Billions Interiors Spend $6.00 $5.00 $4.00 $3.00 $5.5 $2.00 $3.1 $1.00 $0.00 Source: TAC Analysis 2016 2026 13 Seat Aftermarket key attributes . There is virtually no difference between a seat manufactured for new production aircraft line fit or an aftermarket reconfiguration . Airline personality, financial position and product focus will drive seat replacement behavior. Replacements will also vary significantly by seat class . Seat overhauls is a very low margin / low skill business . Seat overhaul intervals will vary greatly and depends on airline product focus . Seat modifications on newer aircraft types can be difficult due to certification regulations . There is a robust second-hand seat trading market in the second and third tier airline community 14 & Seat Production Forecast ~8.5M Seat Places required over next 10 years 1,000,000 900,000 800,000 CAGR 700,000 4.4% 600,000 500,000 400,000 2.9% 300,000 3.0% 200,000 100,000 Number Places Number of Passenger 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Economy Premium* Source: Tronos and Aerodynamic Advisory Analysis * Premium includes F, DF, J, True PY 15 Seat Production Forecast & Line Fit v. Retrofit (Aftermarket) ~50/50 split New to Retrofit deliveries 1,000,000 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 Number Places Number of Passenger 100,000 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Retrofit New Production Source: Tronos and Aerodynamic Advisory Analysis 16 Premium Seating Product & Distribution (Lie-Flat v Recline) 120 100 Thousands 80 60 40 20 Total PremiumTotal Seat Places 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Lie-Flat Premium Recliner Premium* Source: Tronos and Aerodynamic Advisory Analysis * Recliner Premium includes F, J and DF 17 Seat Production Value Forecast & Line Fit v Retrofit (Aftermarket) ~$64B in seat production over the next 10 years $8 $7 Billions $6 $5 $4 CAGR 4.5% Avg. $3 $2 Total Value of Seats (USD) Seats of Value Total $1 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Retrofit New Production Source: Tronos and Aerodynamic Advisory Analysis 18 Premium Seating makes up ~74% of the total value of seating & market $8 $7 Billions $6 $5 $4 $3 $2 Total Value of Seats (USD) Seats of Value Total $1 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Premium Y Source: Tronos and Aerodynamic Advisory Analysis 19 SECTION 3: Seating Industry Key Players 20 Seat Market Share Estimates B/E Recaro, 10% Zodiac Recaro B/E, 47% HAECO Thompson ZIM Geven Stelia JAMCO Others Zodiac, 31% Source: TAC Research and Analysis 21 . Recently announced purchase by for an estimated $10.5B . 2015/2016 FY revenues in seating of ~US$1.47B which was about 43% of total sales for Zodiac’s interior products division . Three main seating divisions 1. Zodiac US – (formerly Weber) focuses on all classes of seats 2. Zodiac France – (formerly Sicma) focuses on all classes of seats 3. Zodiac UK – (formerly Contour) focuses exclusively on international first and business class seats Source: Zodiac Aerospace and TAC analysis 22 . Purchased by in 2016 for ~$6.4B . FY2016 total revenues of $2.9B while in FY2015 commercial seat sales were ~$2.1B . Two main seating divisions 1. Main & Business Class seats (NC and Ireland) 2. Super First Class & Business Jet seats (FL and AZ) Source: B/E Aerospace and TAC Research 23 . FY2015 forecasted revenues of ~$432M . Main production facilities in TX and Germany . Known recently for exceptional economy and domestic first class seats Source: Recaro and TAC Research 24 . Main production facility NC . Economy, premium economy and domestic first class focused . Approved for Boeing line fit Source: HAECO and TAC Research 25 . Main production facility Italy . All classes of commercial aircraft seating . Serious delivery and design issues over past 3-4 years and lost a lot of market share from 6-7 years ago . Not currently offerable on line fit Boeing or Airbus Source: Avio Interiors and TAC Research 26 . Main production facility Germany . Currently in production of new, larger production facility . Focus on economy and domestic first class seat products . Offerable on both Boeing and Airbus line fit Source: ZIM Flugsitz and TAC Research 27 . Main production facility in Italy . Focus on economy and domestic first class seat products . Offerable on Airbus line fit Source: Geven and TAC Research 28 . Main production facility in UK . Focus exclusively on First and Business class products . Started as design firm . Offerable on both Boeing and Airbus . Purchased at end of 2016 by AVIC Source: Thompson and TAC Research 29 . Main production facility in France . Focus exclusively on First and Business class products . Started as design firm . Formerly EADS - Sogerma Source: Stelia and TAC Research 30 . 1H2016 seat sale revenues of $55M . Seat production in facility in Japan . Focus exclusively on premium first and business class seats . Started in seating about 10 years ago . Long history in galleys, monuments and cabin structures Source: JAMCO 31 . Main production facility in CA . Focus exclusively on narrow body economy class products . Start-up was heavily supported by Boeing . Offerable on Boeing Source: Lift and TAC Research 32 . Main production facility in UK . Focus exclusively on economy class seat . Short-range, light weight economy class seat with minimal options . Offerable on Airbus Source: Mirus and TAC Research 33 . Main production facility in UK . Focus exclusively on domestic first and economy class seats . Pushing market for ultra light-weight minimalistic seats . Offerable on Airbus Source: Acro and TAC Research 34 . Main production facility in Italy . Focused on business class and economy class seating . First significant win was Hawaiian Airlines A330 business class retrofit program Source: Optimares and TAC Research 35 The rest of the field…. ComFly Source: TAC Research 36 SECTION 4: Major Trends SHAPING THE SEAT MARKET 37 Major Trends . OEMs pushing SFE and limiting customization . Continued supplier consolidation . Airline profitability drives investment in new interiors 38 Major Cabin Modification drivers . In-Flight Connectivity and Entertainment upgrades . Entry of 787 and A350 into service . Business and First Class product upgrades . Cabin density upgrades . Used aircraft trading (Entry into Service mods) . Premium economy product evolutions . Airline mergers / acquisitions . Alliance growth 39 Material Developments . Lightweight materials . New manufacturing techniques . Reduction in # of parts . Higher reliability . Maintain ability to customize 40 SECTION 4: Challenges & Opportunities OF THE AIRCRAFT SEAT MARKET 41 Airline demands provide challenges for interior OEMs . Airlines want customization for product differentiation . Airframe and seat manufacturers want standardization 42 Summary of Challenges . Customization program to program . Significant variation on seats even within the same aircraft . Certification is not always black & white on seats and is constantly evolving . Some jurisdictional variation in installation approvals . BFE v SFE decision . Each airline handles their sourcing and selection of seat products differently . High capital investment is a barrier to entry 43 Opportunities in Interiors . Large growing market . Significant aftermarket opportunities . Seats normally has a shorter finite lifespan than other aircraft systems . Will get upgraded much more than other systems and parts on an AC throughout its life . Changing AC ownership lifecycle drives increased opportunities on interiors 44 Tronosjet Aviation Consulting Inc.
Load more

Recommended publications
  • Additional Details Regarding Westjet's Fare Class Realignment
    Additional details regarding WestJet’s fare class realignment In the late third quarter or early fourth quarter of 2018, WestJet will update our existing fare class structure and how we define our fare classes to better align with industry standards. At the same time, all our aircraft will move to a multi-cabin configuration. These changes will have an impact on your business and as a valued partner, we want to give you advance notice so you can start making any necessary preparations. To help get you ready for this change, we have outlined the following details below: OVERVIEW OF WESTJET FARE CLASS REALIGNMENT ...................................................................................................2 WHAT’S CHANGING ................................................................................................................................................................. 2 WHY WE’RE MAKING THIS CHANGE ............................................................................................................................................. 2 SAMPLE FARE STRUCTURE ......................................................................................................................................................... 2 NEW: OVERVIEW OF MULTI-CABIN AIRCRAFT .............................................................................................................3 WHAT’S CHANGING ................................................................................................................................................................
    [Show full text]
  • International Tariff General Rules Applicable to the Transportation Of
    1 Egypt Air International Tariff INTERNATIONAL TARIFF GENERAL RULES APPLICABLE TO THE TRANSPORTATION OF PASSENGERS AND BAGGAGE ____________________________________ Issue DEC 15 2019 2 Egypt Air International Tariff TABLE OF CONTENTS: PAGE RULE 1 - DEFINITIONS………………………………………………………………………………………………………………..3 RULE 5 - APPLICATION OF TARIFF………………………………………………………………………………………………17 RULE 10 – RESERVATION AND SEAT SELECTION…………………………………………………………………………20 RULE 15 – CURRENCY OF PAYMENT………………………………………………………………………………………….27 RULE 20 – TAXES, FEES AND OTHER CHARGES…………………………………………………………………………..29 RULE 25 – TICKETS…………………………………………………………………………………………………………………….29 RULE 30 – FARE BRANDS, CLASSES OF SERVICE AND UPGARDES……………………………………………….32 RULE 35 – PERSONAL DATA ………………………………………………………………………………………………………37 RULE 40 – PASSENGER WITH DISABILITY ………………………………………………………………………………….39 RULE 45 – OXYGEN SERVICE AND PERSONAL OXYGEN CONCENTRATORS………………………………….44 RULE 50 - UNACCOMPANIED MINORS AND INFANTS…………………………………………………………………46 RULE 55 – PETS AND ANIMALS………………………………………………………………………………………………….49 RULE 60 – BAGGAGE…………………………………………………………………………………………………………………56 RULE 61 – INTERLINE BAGGAGE ACCECPTANCE…………………………………………………………………………79 RULE 65 – ADMINSTARIVE FORMALIITES………………………………………………………………………………….82 RULE 70 – CHECK-IN AND BOARDING TIME LIMITS……………………………………………………………………84 RULE 75 – REFUSAL TO TRANSPORT………………………………………………………………………………………….85 RULE 80 – SCHEDULE IRREUGLARITIES……………………………………………………………………………………….90 RULE 85 – VOLUNATRY CHANGES AND REROUTING………………………………………………………………….94 RULE
    [Show full text]
  • Dual RBD Implementation Guide
    DYNAMIC PRICING Optimized Pricing via Dual RBD Validation Implementation Guide Version 3 August 2021 © 2021 ATPCO. All rights reserved. atpco.net Dual RBD Validation | Implementation Guide Contents Introduction ........................................................................................................................................... 3 1. Overview of Dynamic Pricing Mechanisms ........................................................................................ 4 1.1. Simplified model for dynamic pricing ....................................................................................... 4 1.2. Which Dynamic Pricing solution is right for you? ..................................................................... 5 2. Dual RBD Validation .......................................................................................................................... 6 2.1. Problem Statement................................................................................................................. 6 2.2. Solution Overview .................................................................................................................. 7 2.3. Stakeholders and Impact Summary ........................................................................................ 8 Implementation Guide ........................................................................................................................... 9 3. Definitions ......................................................................................................................................
    [Show full text]
  • Data Application for Category 31 – Voluntary Changes
    DATA APPLICATION CATEGORY 31 – VOLUNTARY CHANGES The information contained in this document is the property of ATPCO. No part of this document may be reproduced, stored in a retrieval system, or transmitted in any form, or by any means; mechanical, photocopying, recording, or otherwise, without the prior written permission of ATPCO. Under the law, copying includes translating into another language or format. Legal action will be taken against any infringement. Copyright © 2002 by Airline Tariff Publishing Company All rights reserved DATA APPLICATION FOR CATEGORY 31 – VOLUNTARY CHANGES Table of Contents 1.0. OVERVIEW ......................................................................................................................................................................................................................... 1 1.1. DATA REQUIREMENTS.......................................................................................................................................................... 2 1.2. DESIGN OVERVIEW................................................................................................................................................................ 2 1.2.1. Four Separate Categories .................................................................................................................................................... 2 1.2.2. Special Record Processing Flow ........................................................................................................................................
    [Show full text]
  • The New Metrics of Success
    FRESH PERSPECTIVES ON AIRLINE FLEET STRATEGIES THE NEW METRICS OF SUCCESS FRESH PERSPECTIVES ON AIRLINE FLEET STRATEGIES Another in a continuing series of Embraer communiqués dedicated to helping airlines confront and overcome the challenges of our industry. 1 FOREWORD INTRODUCTION PART ONE REDEFINING SUCCESS PART TWO MEASURING PERFORMANCE PART THREE SEIZING OPPORTUNITY CONCLUSION 4 3 It’s true: investing in airlines has commonly resulted in FOREWORD disappointment for shareholders — at least partly because of challenges inherent to the business. Consider, for exam- ple, the fact that an airline seat is among the world’s most perishable goods. Once that aircraft door is closed, all empty seats accumulate as waste. As anyone in the industry “INVESTORS knows, seats are so perishable that some airlines are forced to sell them at a very low cost to avoid their being flown empty. Consequently, their revenue potential is diminished even before the cabin door is closed. In the last few decades, the industry has evolved dramati- HAVE POURED cally. Regulation has changed. More efficient aircraft have been introduced. And as capacity has increased, unit costs have been reduced — along with unit revenues and unit profits. All of which raises the question: how can the airline industry provide better returns for investors? We believe such financial success is already emerging from a well- THEIR MONEY executed business strategy. Successful airlines are increasingly focused on the quality of revenue to boost results. From our global perspective, it is clear that the 70 to 130 seat segment can help bring INTO AIRLINES sustainable profitability to the industry.
    [Show full text]
  • SEI Working Paper Carbon Offsetting & Air Travel
    SEI Working Paper Carbon Offsetting & Air Travel Part 1: CO2-Emissions Calculations Anja Kollmuss & Jessica Lane Updates Version May 29, 2008 Acknowledgements We would like to thank Thomas Tomosky, Mary Vigilante, Dietrich Brockhagen, and Georgina Stevens for their comments and contributions. This paper was written with funding from the Stockholm Environment Institute. Stockholm Environment Institute – Carbon Offset Calculators for Air Travel 1 Table of Contents ACKNOWLEDGEMENTS 1 INTRODUCTION 3 1. EVALUATED AIR TRAVEL CALCULATORS 4 2. REVIEW OF PARAMETERS 5 2.1 Aircraft Type 5 2.2 Flight Profile and Flight Distance 8 2.3 Cargo on Passenger Flights 11 2.4 Seat Occupancy Rate (Load Factor) 13 2.5 Seat Class 14 3. CALCULATOR COMPARISON & CONCLUSIONS 16 3.1 Input and Output Parameters of Offset Calculators 17 3.2 Air Travel Examples 18 3.2 Comments on the Evaluated Calculators 22 3.3 Conclusions 23 REFERENCES 24 APPENDIX A 26 APPENDIX B 31 Stockholm Environment Institute – Carbon Offset Calculators for Air Travel 2 Introduction May, 29, 2008 This paper was originally put in the public domain in early May 2008. Since then we have received a number of comments and questions. All three air travel emissions calculator developers were invited to comment on the paper. Atmosfair and TRX Travel Analytics have sent us detailed comments and raised a number of interesting discussion points. Therefore we have decided to revise the document to include the most important comments. Specifically, we have added 2 appendices: Appendix 1: Comments by Dietrich Brockhagen from Atmosfair Appendix 2: Comments by Thomas Tomosky from TRX Travel Analytics Throughout the document we have inserted (in red Arial font) the most pertinent points that were raised in the comments we received.
    [Show full text]
  • Traffic Analyser Glossary of Terms
    TRAFFIC ANALYSER GLOSSARY OF TERMS JUNE 2017 GLOSSARY OF TERMS traffic analyser GLOSSARY OF TERMS Alliance Formal groups of airlines with agreement to cooperate Alliance Affiliate Airlines that provide services in conjunction with individual alliance members Area of sale Location where booking made, identified as local, within region or outside region Behind traffic Airline traffic connecting at the origin airport of an O&D pair Beyond traffic Airline traffic connecting onward from the destination of an O&D pair Booking A single booking represents a single air passenger Bridge traffic Airline traffic connecting at the origin airport of an O&D pair and connecting onward from the destination of an O&D pair Cabin type Seating area of the aircraft as designated by First, Business or Economy class Carrier (Dominant) Dominant (the carrier which operates the longest leg of the routing) Airline carrier name or code Code share A commercial agreement between two airlines that allows passengers to use a ticket from one airline to travel on another Destination Point of arrival for a flight Direction Direction of airline traffic, either from the origin to the destination of an O&D pair (one-way) or airline traffic travelling in both directions between the origin and destination of an O&D pair (two-way) Domicile Jurisdiction (country or region) where airline is based Elapsed Time The time between the departure and arrival times – ramp to ramp – in minutes. This includes any stopover time if the flight involves one or more stops Flight Type International or domestic Hub traffic Airline traffic connecting at an airport; combination of behind traffic and bridge traffic Hub airport Airport used as a transfer point by airlines Confidential Information Copyright 2017, OAG Aviation Worldwide Limited.
    [Show full text]
  • Reimbursement Rates for Air Travel
    United States Department of Agriculture Farm and Foreign MAP 15–004 Agricultural Services SUBJECT: Reimbursement Rates for Air Travel under Generic Promotion Foreign Activities Agricultural Service TO: All Market Access Program (MAP) Participants 1400 Independence Ave, SW Stop 1052 Washington, DC ISSUE 20250-1052 The revised MAP regulations were published on May 17, 2012, and became effective beginning with program year 2013. This program notice is being issued to provide clarity regarding the reimbursement rates for air travel under generic promotion activities. Regulations regarding the reimbursement rates for air travel under generic promotion activities are found at 7 CFR 1485.17(c) (8) (ii), (iii), and (iv). These sections read as follows: §1485.17(c)(8)(ii) CCC generally will not reimburse any portion of air travel, including any fees for modifying the originally purchased ticket, in excess of the full fare economy rate or when the MAP Participant fails to notify the Attaché/Counselor in the destination country in advance of the travel, unless the CCC determines it was impractical to provide such notice. If a traveler flies in business class or a different premium class, the basis for reimbursement will be the full fare economy class rate for the same flight and the MAP Participant shall provide documentation establishing such full fare economy class rate to support its reimbursement claim. If economy class is not offered for the same flight or if the traveler flies on a charter flight, the basis for reimbursement will be the average of the full fare economy class rate for flights offered by three different airlines between the same points on the same date and the MAP Participant shall provide documentation establishing such average of the full fare economy class rates to support its reimbursement claim.
    [Show full text]
  • Ftl R 1987 07.Pdf
    FLIGHT TRANSPORTATION LABORATORY REPORT R87-7 AIR TRAVEL DEMAND AND AIRLINE SEAT INVENTORY MANAGEMENT PETER PAUL BELOBABA Air Travel Demand and Airline Seat Inventory Management by Peter Paul Belobaba Flight Transportation Laboratory Massachusetts Institute of Technology May 1, 1987 ABSTRACT Many airlines practice differential pricing of fare products that share a common inventory of available seats on an aircraft. Seat inventory management is the process of limiting the number of seats made available to each fare class. The objective of both strategies is to maximize the total revenues generated by the mix of fare products sold for a flight. This dissertation first examines the evolution of airline marketing and seat in- ventory management practices. A demand segmentation model is developed to help explain current airline fare structures. A conceptual model of the consumer choice process for air travel is then presented, and extended to describe the airline reserva- tions process and the probabilistic elements that can affect seat inventory control. A survey of current airline practice in this area revealed that seat inventory control is an ad-hoc process which depends heavily on human judgement. Past work on quantitative approaches has focused on large-scale optimization models that solve simple representations of the problem. A primary objective of this research was the development of a quantitative approach based on the practical constraints faced by airlines. The Expected Marginal Seat Revenue (EMSR) model developed in this thesis is a decision framework for maximizing flight leg revenues which can be applied to multiple nested fare class inventories. It is applied to a dynamic process of booking limit revision for future flight departures, and overbooking factors as well as fare class upgrade probabilities are incorporated.
    [Show full text]
  • 23-26 September 2019 Miami, USA Involuntary Interline TFC Problem and Solution IBS OPS WG Breakout Session #1 Background 1
    23-26 September 2019 Miami, USA Involuntary Interline TFC Problem and Solution IBS OPS WG Breakout Session #1 Background 1. The current RAM rule allows TFC billing only if the TFC code was applicable to the original routing and caps the value to be billed 2. The comparison of original routing to revised routing is further complicated when the same TFC code applies to several sectors 3. This complexity has contributed heavily to tax rejections • The SIS team has reported tax rejections now represent 66% of all RMs Background 4. The premise of R785 is that the validating carrier collects TFCs on behalf of the operating carrier • TFCs should not be a commercial decision or revenue opportunity 5. Proposals to improve TFC settlement procedures in case of involuntary rerouting are routinely submitted with little success • A proposal to simplify procedures was narrowly defeated last year Making the Proposal More Acceptable 1. Carriers are encouraged to request TFC exemptions in case of involuntary rerouting • Many tax codes have already been filed with exemptions in case of involuntary rerouting ➢ Proposal: TFC exemptions in case of involuntary rerouting shall apply regardless of the reason for involuntary rerouting • The IBSOPSWG has submitted a business request to ATPCO to amend the TTBS and RATD X2 file with Y/N to indicate an involuntary exemption is present 2. Delay the effective date for the change to 1st April 2020 Goal to Rejection Free Tax Settlement 1. Remove the complexity 2. Standardize tax filings to the extent possible 3. Lobby authorities to file exemptions in case of invol rerouting 4.
    [Show full text]
  • Award Tickets with Skyteam
    AWARD TICKETS WITH SKYTEAM The SkyTeam Awards scheme is one of the major advantages you get from the SkyTeam Alliance. A single award ticket for any destinations worldwide, even when you choose an itinerary involving more than one airline. With a single ticket you save lots of miles! The following table shows the number of miles needed to request Award Tickets for destinations reached by SkyTeam Partners. Values in the table are expressed in thousands of miles, and indicate the miles needed for requesting a ticket in Economy Class and Business Class respectively. The following page shows details to destination areas. Central Europe1 and Europe 2 and Europe 3 and Near Central and Indian Sub- America, South South Australia North Africa 1 North Africa 2 East Middle East Southern Northern Asia Southeast Asia Continent North America Caribbean, America 1 America 2 and Pacific Africa Hawaii, Europe 1 and Mexico 1 1 2/3 2/3 North Africa 1 20 /30 25 /40 30/45 40/60 70/100 80/120 80/120 50/80 50/80 50/80 60/100 80/120 100/150 Europe 2 and 2/3 2/3 4 4 12 12 North Africa 2 25 /40 25 /40 30/45 40/60 70/100 80/120 80/120 50/80 50/80 50 /80 60/100 80/120 100/150 Europe 3 and Near East 30/45 30/45 30/45 40/60 70/100 80/120 80/120 50/80 50/80 50/80 60/100 80/120 100/150 Middle East 40/60 40/60 40/60 4016/6016 8014/12014 80/120 80/120 805/1205 80/120 80/120 80/120 100/150 110/160 Central and Southern 70/100 70/100 70/100 8014/12014 406/606 100/150 120/180 80/120 80/120 100/150 100/150 120/180 120/180 Africa Northern Asia 80/120 80/120 80/120 80/120 100/150
    [Show full text]
  • Perceptions of Customers As Sustained Competitive Advantages of Global Marketing Airline Alliances: a Hybrid Text Mining Approach
    sustainability Article Perceptions of Customers as Sustained Competitive Advantages of Global Marketing Airline Alliances: A Hybrid Text Mining Approach Gang-Hoon Seo 1,* and Munehiko Itoh 2 1 Graduate School of Business Administration, Kobe University, Kobe 657-8501, Japan 2 Research Institute for Economics and Business Administration, Kobe University, Kobe 657-8501, Japan; [email protected] * Correspondence: [email protected]; Tel.: +81-80-4764-7504 Received: 22 June 2020; Accepted: 31 July 2020; Published: 3 August 2020 Abstract: Over the past several decades, the aviation industry has been reshaped, centering on global alliances, and these have grown exponentially. However, it is still not clear whether they are achieving sustained competitive advantages, and what are the specific competitive advantages of the three alliances (oneworld, SkyTeam, Star Alliance) arising on the customer side. This study aims to examine whether global alliance groups outperform the non-alliance group, how the three alliances differ regarding passengers’ perceptions, and what their competitive advantages are. A hybrid text mining analysis was adopted as this study’s method. Frequency tests, t-tests, one-way analysis of variance tests, and three-step mediated regression analyses were performed using 6393 ordinal and word-of-mouth (WOM) data. We found that the degree of passengers’ perceptions of alliances was low, the non-alliance group outperformed the alliance groups, and there were no significant differences between alliances on service rating and sentiment score. Only oneworld has competitive advantages that link to passengers’ service rating and sentiment score. These findings imply that alliances could not ensure competitive advantages that derive from customers’ perceptions, and although passengers partly perceived several selling points, their differentiation strategies are not successful.
    [Show full text]