It took less than a decade for low-cost air travel to make its mark on the French landscape. But it has taken many battles to reach the figure of 32 million passengers carried last year by low-cost airlines, both to and from France... And many victories for a model that now represents a market share of 21 % in mainland France.
It has to be said that this country offered fertile ground for the development of low-cost airlines. This is because, relatively uniquely in Europe, air travel has long been concentrated in the hands of an omnipotent flag carrier, Air France. This situation ended up becoming a source of frustration in the regions, particularly when the national airline began to consolidate its flights at Roissy in the 1990s, in order to create Europe's leading hub for its connecting flights.
This relative withdrawal has forced the marketing departments of regional airports to court both traditional foreign airlines, led by British Airways and Lufthansa, and low-cost air transport. This is a particularly attractive segment even for small hubs, whose traffic does not exceed a few tens of thousands of passengers a year.
From there, the low-cost conquest really began in 1996, with EasyJet and Virgin Express starting to serve Nice. In 1997, it was the turn of Ireland's Ryanair to launch at Beauvais from Dublin, then Glasgow-Prestwick, before tackling the citadel of Carcassonne in 1998. Following the 2003 reduction in airport charges on provincial hubs, Ryanair caused a veritable flood of activity in the French regions, inaugurating 18 routes to France from London Stansted, its main base, in the summer of the same year. At that time, however, low-cost airlines were still focusing on inbound rather than outbound traffic. When the weather was fine, waves of low-cost carriers flocked to Nice and the Côte d'Azur. The real revolution came later, in the mid-2000s, with the opening of real low-cost bases in France. First came EasyJet in Basel/Mulhouse in 2005, followed in 2006 by Ryanair in Marseille, in a new terminal with simplified services called MP2.
Heading for the Côte d'Azur
In 2008, EasyJet continued its strategy in France by opening bases at Paris CDG and Lyon, followed in 2012 by Toulouse and Nice. "Thanks to this airline and 16 other low-cost carriers, Nice is the leading provincial airport for this type of traffic, with 3.4 million passengers out of the 10 million recorded in 2011".explains Hervé de Place, Chairman of the Airport Board.
Over the past four years, low-cost airlines, which originally concentrated on services to France from abroad, have gradually positioned themselves on cross-border domestic routes. EasyJet is present on around fifteen routes within France, Ryanair on half a dozen, while Volotea has made a breakthrough since its launch last spring by opening routes to around twenty destinations from its base in Nantes, including nine with a French focus, and seven from Bordeaux, including three within France. This will probably be followed by a new hub in Strasbourg. As you can see, France has gradually become a preferred destination for low-cost carriers from all over Europe and North Africa. Over the last decade, Bmibaby, Buzz, Clickair, Go, Nikki, Wizz Air, Vueling, Sterling Airways, Norwegian, Blue Air and Sky Europe have all set out to conquer the French market.
The throes of bankruptcy
This plethora of ambitious players has, however, resulted in the demise of a number of them, forced to merge - Go with EasyJet, Clickair with Vueling, Buzz with Ryanair - when they have not been the protagonists of spectacular bankruptcies. In France, it was Air Lib Express in 2003, following the haphazard management of its former CEO Jean-Charles Corbet. Elsewhere, the curtain came down on Sky Europe in Bratislava, Sterling Airways in Denmark and, last September, the UK's Bmibaby.
In the end, it is still the same two incumbent operators, Ryanair and EasyJet, who carry the weight of low-cost transport in France, each offering significantly different models. Ryanair continues to embody the low-cost model in its most stripped-down version, with a product that is less suited to the needs of business travellers: almost exclusive services to secondary airports - apart from Marseille and Bordeaux, Ryanair planes land at Beauvais, Dinard, Rodez or Vatry -; great flexibility, sometimes leading to the closure of routes after just three months of operation; strict conditions of carriage with a limit on checked baggage, and minimal comfort on board the aircraft...
Despite this spartan offering, Ryanair is nonetheless the third largest airline in France, with seven million passengers, almost twice as many as Lufthansa! Ryanair's services are concentrated at Beauvais airport, from where it operated an average of 750 flights a month to 46 destinations last winter. Another stronghold for the Irish company, even though it has officially closed its base there for tax reasons, is Marseille, with 33 destinations and almost 300 flights a month.
Business Offers
From the point of view of traditional full-service companies, EasyJet is a more formidable competitor. "France remains our priority market, since one passenger in five carried by the airline is registered in that country".said Carolyn McCall, the company's CEO, last spring at the inauguration of the new base in Nice. "EasyJet is not playing head-to-head, but complementing Air France. With 13.5 million passengers in 2011, an increase of 12 % compared with 2010, Easy-Jet is indeed a major player with its five bases at Paris CDG and Orly, Lyon, Nice and Toulouse as well as its strong presence at Bordeaux and Nantes airports".she adds.
By targeting the same customers, the differences between low-cost carriers and historical companies are gradually diminishing. Spain's Vueling, champion of a hybrid model, is described by its CEO Alex Cruz as a "low-cost carrier". "a new generation company. Like all low-cost airlines, its mid-range positioning means that sales are almost exclusively online (96 % of sales go through the www.vueling.com website, including sales to travel agents via a dedicated space). "Place Duo which allows priority boarding and the neutralisation of the middle row seat, or a pass giving access to a lounge. Alex Cruz likes to say: "A low-cost model does not mean a lack of quality. The winning product will be the one operated at a very low unit cost while offering an enhanced service, in the manner of traditional airlines."
In the same vein, EasyJet, which also offers a frequent flyer programme, has also expanded its business product. The new flexible offer allows corporate passengers to make unlimited changes to their tickets for a period of four weeks, directly in the three weeks following the initial date of travel, but also during the seven days prior to departure, up to two hours before the scheduled take-off time. Passengers who have booked this type of ticket benefit from the priority service. "Speedy Boarding at no extra charge, as well as the possibility of checking in one piece of hold baggage free of charge.
By expanding their range of services, low-cost carriers are moving closer to the model of the incumbent airlines, which in turn are drawing more and more inspiration from the low-cost offer. It's a pendulum swing that began in the early 2000s, when Brussels Airlines and then SAS Scandinavian Airlines introduced a new in-flight class modelled on low-cost carriers, offering low fares but paying for in-flight services. Finnair, Austrian and even Swiss followed the low-cost model, abolishing the requirement to buy a return ticket.
Communicating vessels
Air France is also experimenting with low cost through its subsidiary Transavia, which is positioned at Orly and now at Nantes on leisure routes in Europe and around the Mediterranean basin. According to Hélène Abraham, Vice President Sales, Marketing and Products at Transavia, "Orly is set to grow, with the fleet set to increase from 8 to 22 aircraft".. Another example of the low-cost influence on the French flag carrier is its regional offensive with the launch of point-to-point connections from regional bases in Marseille, Toulouse and Nice. However, unlike low-cost carriers, Air France guarantees one piece of checked baggage and a minimum free on-board service.
Lufthansa has just followed in the French airline's footsteps by transferring most of its European routes to its low-cost subsidiary Germanwings, which, from the beginning of 2013, will redevelop on the basis of a hybrid airline model with simplified services. As a result, Lufthansa will only operate European feeder flights from its Frankfurt and Munich hubs. Alex Cruz had been anticipating this cross-fertilisation of models for some time. At the last French Connect conference, the CEO of Vueling envisaged a European short- and medium-haul air transport system operating at two speeds: a few classic routes with high business potential will remain and supply the major hubs, while the rest of the European network will be served by models oscillating between low-cost and simplified services.
So the future looks bright for low-cost carriers, particularly in a period of recession when individuals and businesses alike are still looking for the best opportunities to travel on a budget. So there is still room for growth in low-cost traffic in France, "especially when you consider that the share of low-cost transport can be as high as 45 % of total traffic in some European countries".emphasises François Bacchetta. With one small nuance: from now on, low-cost carriers will have to learn to play elbows with the incumbent airlines to attract passengers...
Transavia, The Air France-Klm Group's Secret Boot
Conceived as a leisure airline that complements the Air France network, Transavia has all the hallmarks of a low-cost airline, with bookings made mainly over the Internet and additional services for which a charge is made, such as seat reservations and additional baggage. The only real difference is a business model "based on long-term partnerships with tour operators, supplemented by scheduled leisure flights to meet individual demand", explains Hélène Abraham, Vice President Sales, Marketing and Products. In fact, Transavia is a strategic element for Air France, which wants to use the airline more and more to capture two markets: the leisure market departing from Paris Orly, and the market for holiday destinations in the provinces. The strategy of conquering the provinces begins with Nantes, which is Transavia's second home base after Orly. While the Paris airport remains Transavia's main base, the airline offers flights from Nantes to a dozen destinations during the summer and to seven destinations this winter, including Berlin, Rome and Venice. Lille is now emerging as its third base, with flights to six destinations - Agadir, Ajaccio, Marrakech, Oujda, Rome and Venice - in summer 2013.
