Air Berlin said the first-quarter loss widened because of the takeover of DBA and as fewer available seats were filled. The net loss was 41.3 million euros ($55.5 million) compared with 31.1 million euros a year earlier.
The first-quarter load factor declined 1.7 percentage points from a year earlier to 69.5 percent, trailing competitors, as tour operators booked fewer seats. Revenue per available seat kilometer rose 4.1 percent to 5.77 euro cents, Air Berlin said.
The load factor at Dublin-based Ryanair Holdings Plc, Europe's largest budget carrier, averaged 75.3 percent in the three months ended March 31. Luton, England-based EasyJet Plc, which ranks between Ryanair and Air Berlin in passenger numbers, posted an average load factor of 80.7 percent.
First-quarter passenger numbers rose 12 percent to 4.2 million people. Air Berlin said it's sticking to a 2007 passenger-number growth target of between 10 percent and 11 percent.
Kevin777 From Denmark, joined Sep 2006, 985 posts, RR: 1 Reply 1, posted (1 year 4 months 2 weeks 2 days 10 hours ago) and read 1380 times:
Sorry to see AB suffer, but I reckon they're in for a tough one in the coming years.
IMO the airline has had - and still has to some extend - great difficulties in finding its niche between low-cost carrier and old legacy; if there is a niche there at all.
The airline still rests significantly on old-fashioned IT flights, and also sticks to the loyal business clientele through an FFP etc. On top of this the airline struggles with U2 and others pushing "from below" with true low cost products.
Whether there is a niche for AB's type of product is debatable, but I hardly think it should be taken for granted - but let's see how the airline will tackle it.
Regards,
Kevin777
"I was waiting for you at DFW, but you must have been in LUV" CPH-DEL-CPH SK343
Delta777Jet From Germany, joined Jun 2000, 788 posts, RR: 1 Reply 2, posted (1 year 4 months 2 weeks 2 days 10 hours ago) and read 1354 times:
Long term AB will go to the Lufthansa club , I'm pretty sure about it and some reason need to be there that Deutsche Bank holds a significant percentage in the capital of Air Berlin.
Joost From Netherlands, joined Apr 2005, 1796 posts, RR: 3 Reply 3, posted (1 year 4 months 2 weeks 2 days 9 hours ago) and read 1290 times:
Quoting Kevin777 (Reply 1):
IMO the airline has had - and still has to some extend - great difficulties in finding its niche between low-cost carrier and old legacy; if there is a niche there at all.
Interesting enough, more and more carriers seem to move to these kind of niches, then abandoning them. At least in Germany, both Germanwings and TUIfly are operating these hybrid models. I saw Germanwings is currently even offering flex fares next to standard fares, and has launched the Boomerang club not too long ago; TUIfly is a mix of everything.
I often have the impression that some carriers tried to immitatie the easyJet/Ryanair model, but were not able to be as profitable by this model as those two, and got too much negative feedback from existing customers, that they put back all kind of frills, navigating themselves into difficult niches.
In the same market as Air Berlin (charter flights, scheduled holiday flights and city-shuttle flights) Transavia is operating very succesfully, at least financially. So there might well be a market for it; granted that in the Netherlands, as there is virtually no competition between airports (like in Germany, where the competition is as well between airlines (FR/AB) as airports (NRN/DUS); they hardly have any competition.
OHLHD From Finland, joined Dec 2004, 3201 posts, RR: 15 Reply 4, posted (1 year 4 months 2 weeks 2 days 9 hours ago) and read 1257 times:
Quoting PlaneHunter (Thread starter): Air Berlin said the first-quarter loss widened because of the takeover of DBA and as fewer available seats were filled. The net loss was 41.3 million euros ($55.5 million) compared with 31.1 million euros a year earlier.
How much would be the loss without Dba?
Must we be feared that they could go down? I was of the impression that it is not so bad although some losses in recent years.
Dest 2008:BRU,VIE,OSL,TRD,BOO,TOS,DOH,ZRH,HEL,TXL,KUO,MUC,NRK,JYV,FRA,AES,HOV,THF
Kevin777 From Denmark, joined Sep 2006, 985 posts, RR: 1 Reply 5, posted (1 year 4 months 2 weeks 2 days 9 hours ago) and read 1233 times:
Quoting Joost (Reply 3): Interesting enough, more and more carriers seem to move to these kind of niches, then abandoning them. At least in Germany, both Germanwings and TUIfly are operating these hybrid models. I saw Germanwings is currently even offering flex fares next to standard fares, and has launched the Boomerang club not too long ago; TUIfly is a mix of everything.
Well, I see what you're saying, but the problem is, IMO, that many airlines think that the way to make money - when they fail to do so as "true" LCCs - is to differentiate themselves. This is sort-of "classic" popular business school theory, and although it might work in industries such as clothing etc., I don't think it works in European short-haul air travel. Price is still ki9ng, meaning that low costs win in these markets. Granted, things might change, and people might start to want more extras, but for now, it doesn't look like it. It might be a slightly different case for Germany; however, hardly that different from the rest of Europe afterall.
Kevin777
"I was waiting for you at DFW, but you must have been in LUV" CPH-DEL-CPH SK343
PlaneHunter From Germany, joined Mar 2006, 2359 posts, RR: 59 Reply 6, posted (1 year 4 months 2 weeks 2 days 9 hours ago) and read 1214 times:
Quoting Kevin777 (Reply 1): IMO the airline has had - and still has to some extend - great difficulties in finding its niche between low-cost carrier and old legacy; if there is a niche there at all.
The airline still rests significantly on old-fashioned IT flights, and also sticks to the loyal business clientele through an FFP etc. On top of this the airline struggles with U2 and others pushing "from below" with true low cost products.
AB's model of mixing leisure flights, business routes and city shuttle flights from regional airports has worked well and I'm sure it will continue to do so. However, they need some more time for the integration of dba.
Quoting Delta777Jet (Reply 2): Long term AB will go to the Lufthansa club , I'm pretty sure about it and some reason need to be there that Deutsche Bank holds a significant percentage in the capital of Air Berlin.
I can't imagine such a scenario which would eliminate or significantly reduce competition on the vast majority of domestic routes and a large number of European routes. Both carriers are also totally differently structured, any attempt of a cooperation or integration would probably result in a mess.
Quoting Joost (Reply 3): I often have the impression that some carriers tried to immitatie the easyJet/Ryanair model, but were not able to be as profitable by this model as those two, and got too much negative feedback from existing customers, that they put back all kind of frills, navigating themselves into difficult niches.
I don't think AB has ever tried to copy the basic LCC concept. They know they would lose many loyal customers by turning into a pure LCC.
Quoting OHLHD (Reply 4): How much would be the loss without Dba?
Must we be feared that they could go down? I was of the impression that it is not so bad although some losses in recent years.
DBA, which was included in Air Berlin's results as of Sept. 1, posted a net loss in the first quarter, Huettmeyer said, without providing a figure.
We have to wait and see but I think the results will improve once the integration is completed.
Delta777Jet From Germany, joined Jun 2000, 788 posts, RR: 1 Reply 7, posted (1 year 4 months 2 weeks 2 days 8 hours ago) and read 1158 times:
Let Ryanair and Easyjet open a few more point to point connections between Germany and leisure destinations in Spain and we will see the effect on AB's next balance sheet , simply because to handle a big portion of traffic thru PMI airport can not be efficient as point to point connections and its also a pain for the passengers simply because nobody wants to fly from e.g. Berlin via Palma to Madrid.
Further more the customers will go once realised with happiness to secondary airports like Weeze instead of DUS because they save in parking fees, they dont have big ATC delays, much lower ticket prices and they can go without a stop and aircraft change to their destination.
Also the deal with DBA is in my opinion not a good move for the shareholders of AirBerlin because DBA up to my knowledge never making any profit and to pay for the loosing business such a great amount of money is just crazy.
For me the Air Berlin story sounds like the Swissair Hunter Strategy and even the names involved (LTU) are repeating.
However positive for the short term is that AB can increase on many routes ticket prices as their is less competetion and probaly will have good results for a year or so. But let's await the first consolidated balance sheet with LTU included..............
PlaneHunter From Germany, joined Mar 2006, 2359 posts, RR: 59 Reply 8, posted (1 year 4 months 2 weeks 1 day 11 hours ago) and read 944 times:
Quoting Delta777Jet (Reply 7): Let Ryanair and Easyjet open a few more point to point connections between Germany and leisure destinations in Spain and we will see the effect on AB's next balance sheet , simply because to handle a big portion of traffic thru PMI airport can not be efficient as point to point connections and its also a pain for the passengers simply because nobody wants to fly from e.g. Berlin via Palma to Madrid.
PMI is the final destination for most pax flying into the airport - the domestic sectors are just an addition. And it's unlikely FR and U2 move into AB's German hubs. Btw - there's still the Bundeskartellamt which would oppose a an AB-LH team play.
Quoting Delta777Jet (Reply 7): Further more the customers will go once realised with happiness to secondary airports like Weeze instead of DUS because they save in parking fees, they dont have big ATC delays, much lower ticket prices and they can go without a stop and aircraft change to their destination.
The advantages you suggest don't necessarily reflect reality. There may be certain cases, but there's no general rule.
Quoting Delta777Jet (Reply 7): Also the deal with DBA is in my opinion not a good move for the shareholders of AirBerlin because DBA up to my knowledge never making any profit and to pay for the loosing business such a great amount of money is just crazy.
dba was not a losing business any more thanks to Rudolf Woehrl.
Quoting Delta777Jet (Reply 7): For me the Air Berlin story sounds like the Swissair Hunter Strategy and even the names involved (LTU) are repeating.
Delta777Jet From Germany, joined Jun 2000, 788 posts, RR: 1 Reply 9, posted (1 year 4 months 2 weeks 1 day 9 hours ago) and read 880 times:
Planehunter: You are absolutely right, it was a perfect deal for Mr Whoerl because he purchased DBA for 1 EUR got a few millions on top of that to operate on losses further on and then was selling to AB and got the money rain. Without AB buying them they would be probably gone soon. Did you saw the balance sheet of DBA or why are you so sure about the profits ? Why they loosing money now if they were profitable before ? If they made profits before without AB, why we see now deep red figures without AB commenting them ?
Quoting Delta777Jet (Reply 9): Why they loosing money now if they were profitable before ? If they made profits before without AB, why we see now deep red figures without AB commenting them ?
TommyBP251b From Germany, joined Apr 2006, 352 posts, RR: 0 Reply 11, posted (1 year 4 months 2 weeks 1 day 8 hours ago) and read 795 times:
Quoting Delta777Jet (Reply 7): Let Ryanair and Easyjet open a few more point to point connections between Germany and leisure destinations in Spain and we will see the effect on AB's next balance sheet , simply because to handle a big portion of traffic thru PMI airport can not be efficient as point to point connections and its also a pain for the passengers simply because nobody wants to fly from e.g. Berlin via Palma to Madrid.
I agree with you in that case. My parents have a flat near ALC. We allways flew LT from DUS-ALC. I am going to fly there this summer again. I checked all possible flights. LT was somehow "downgraded" or reduced, I guess because of the merger with AB. So I had the option with AB via PMI or 4U from CGN to ALC non-stop which I finally booked. Let's be honest, we are in Europe, which is not USA! If we want to fly somewhere, it would be nice to fly non-stop.
Another reason I stopped flying AB is because I live and study in BUD. AB allways was my first choice, but then they started this DUS-NUE-BUD thing, with their hub in NUE, which took 4 hours, instead of a nonstop DUS-BUD. 4U is 1,5 hours. So at the moment I only fly 4U to BUD or ALC from CGN.
I can understand, that this hub system is more economically, especially in the low-winter-season. But why should I fly 4-5 hours if I can do it in 2 hours with another airline. Yeah its more economically for the airline, but for passengers its a real pain.
Delta777Jet From Germany, joined Jun 2000, 788 posts, RR: 1 Reply 12, posted (1 year 4 months 2 weeks 1 day 8 hours ago) and read 766 times:
TOM: You are absolutely right, but I have doubts that it is economical to route flights via a HUB such as NUE or PMI and if 4U can fill the plane non-stop, why AB can't do it ? In general a routing via a HUB is longer than a non-stop and results in increased cost for fuel, maintenance, navigation fees, catering, landing and ground handling fees. So this means almost doubled costs which reflects in the profitability of the entire operation and makes it hard for AB to earn money on short haul flights..
I just tried to find a reason for this Hub-thing. My mum always asked me, why AB is doing this, so I somehow had to explain it to her in this way. But you are absolutely right, it will cost AB more.
Sorry to say, but AB wont see me anymore on their flights, untill they don't stop their hub flights. They should make two hubs. One has to be DUS in order to fill the LT long-haul flights. And the other one in NUE or MUC.
IMO, the people, especially the business-men soon or later will choose 4U over AB, if they don't fly LH.
Beaucaire From Syria, joined Sep 2003, 4707 posts, RR: 23 Reply 14, posted (1 year 4 months 2 weeks 1 day ago) and read 691 times:
Destinations like Lisbon,Porto,Istanbul,Izmir,Brussels,Lyon,Nice,Orly,Montpellier,Athens should be permanent direct flights for AB instead of concentrating all on Palma.
Competition on Palma is ever increasing and yiels will be lousy.AB should have opened true hubs outside of Germany ( Brussels,Lyon,Athens,Belgrade..) and not leave this to Easyjet or Ryanair.
Their focus on vaccation-flights leaves them more vulnerable ,since non-warm water passengers pay higher yields.
You are absolutely right! I have several reasons I stopped even looking at AB as an option when ever I need to go to a German partner:
I think they pretty much have an identity crisis, somewhere between a real LCC and a legacy carrier. However I think their service is wonderful to be an LCC, but their price is too much for what they provide. For example I will have 3 flights in the next 2 months to German destinations, all booked on MA. To be honest AB was not an option on any of the given dates, because apart from not being able to offer direct service, the prices where insanely higher. After finishing the bookings this was my exact thought too: How are they going to keep customers? Overpriced product with eliminating the value of direct flights... good luck to them, I'd rather take MA and LH any time from BUD...
TriStar500 From Germany, joined Nov 1999, 4589 posts, RR: 38 Reply 16, posted (1 year 4 months 2 weeks 23 hours ago) and read 654 times:
Two mergers/ acquisitions in two years (DI/LT), expanding the passenger volume by 50% and adding several new subtypes to an already (for a low fares airline) varied fleet, having to integrate different work models and service- and supplier concepts - all this leads to the kind of frictions we see today. In the opinion of this frequent AB flyer (more than 160 segments until today), the airline has recently somewhat abanoned their original business strategy, which used to be the basis of their success - a fairly simple fleet, competitive fares and fairly good cabin service. The fleet - although a spotters dream, is an assembly of different types and versions ranging from F-100 to A330-300, the average fare level has risen, nowadays often surpassing the fares offered by LH etc., cabin service was notably watered down and the charter business is breaking away.
Was the recent growth rate too ambitious? Methinks, the integration of LTU was probably one bite too big at this time.
Edit: typos
[Edited 2007-06-01 09:09:56]
Homer: Facts are meaningless. You could use facts to prove anything that's even remotely true!
Sponsor Message: 
From Germany, joined Mar 2006, 2359 posts, 
From Denmark, joined Sep 2006, 985 posts, 
From Netherlands, joined Apr 2005, 1796 posts, 
From Finland, joined Dec 2004, 3201 posts, 
From Syria, joined Sep 2003, 4707 posts, 
From Hungary, joined Jan 2007, 387 posts, 
From Norway, joined Sep 2005, 609 posts,