Competition

Legacy carriers


► European Carriers

In addition to AIR FRANCE KLM, two other major European airline groups, Lufthansa-Swiss and British Airways, have become sector leaders over the past five years.

Thanks to significant rises in unit revenue, and a more effective fuel hedging policy, each of these groups has adopted a specific growth strategy.

  • Lufthansa

After being the most diversified group in Europe, Lufthansa recently refocused on its core business – passenger transport and on two related activities - cargo transport and aircraft maintenance.

Lufthansa has developed a multi-hub strategy in Germany (Frankfurt and Munich) and in Switzerland (Zurich), after the takeover of Swiss.

The Lufthansa-Swiss Group model is fundamentally different from that of AIR FRANCE KLM. Instead of overlapping services on the long-haul network out of Frankfurt and Munich, Air France and KLM offer two complementary networks out of Paris-CDG or Amsterdam-Schiphol. 

  • British Airways

  • British Airways’ growth strategy is limited by the congested facilities at Heathrow Airport, which only offers two runways and no development potential in the medium term.
  • British Airways has opted to focus on point-to-point traffic, by giving priority to Business Class, and reducing capacity on the European and domestic networks, where the competition with low-cost carriers is proving tough.

► American Carriers

In the United States, network carriers have to cope both with low-cost operators and a drop in demand on the domestic market.  As a result, they have developed on international markets, after restructuring under the protection of the U.S. bankruptcy law (the famous Chapter 11).

Once they recovered, and after achieving considerable productivity gains, the U.S. carriers are now redeploying in Europe the fleet they would normally use on their domestic network, where they have reduced capacity.

These medium-capacity aircraft like the Boeing 757 with some 200 seats, are adapted to relatively short distances between the United States and Europe.

After American Airlines in 2004 and US Airways in 2006, Northwest and Delta have launched new services operated with the Boeing 757.