Europe: September 2006 Archives

In an odd move, the European Regions Airlines Association (ERA) is leading an initiative to improve the transparency of prices on airline websites.

The ERA board approved at its annual general meeting in Barcelona on 28 September a resolution urging member and non member airlines to adhere to its recommendations for making clear on their websites how much tickets cost. Those airlines which adhere to the ERA standard for transparency of ticket prices will be permitted to publish a special logo unveiled by ERA at a press conference during its annual general meeting.

The logo (see below) looks similar to the ERA logo but instead of saying ERA it says "plain fares". The ERA plans to later make the logo available in several foreign languages.

ERA director of air transport policy Andy Clarke says the ERA decided to launch the initiative to mitigate passenger confusion caused by the omission of taxes and charges on some airline websites. Some airline websites do not display taxes and charges until the end of the transaction. To qualify for the "plain fares" logo, airlines must display a fully inclusive ticket price with equal prominence as the base fare. If the airline charges a booking or credit card fee for internet transactions, this fee must also be displayed prominently.

Clarke says the campaign is a step ahead of new European Union regulations which will take effect at the end of 2007.

The ERA is hoping other industry association will follow its lead and launch similar initiatives. "We cannot think of any precedence for this," ERA president Mike Ambrose says. "We think the idea should be picked up by other associations and airlines that are not part of any association."

But what value does this new ERA logo give passengers? ERA or any airline association does not have a recognisable brand outside the industry and ERA does not have the budget to launch a public awareness campaign. So what incentive does an airline have to listen to ERA, especially those that are not members and are even from different regions of the world?

Airline Business deputy editor Brendan Sobie asked Ambrose if it was unusual for an airline association to launch a campaign geared towards the passenger and he responded it was not only about building a profile for ERA with passengers but with the European Commission. "We want it to become a universally recognised hallmark," he says.

We will have to see if airlines now rush to prove to ERA they are worthy of the catchy "plain fares" slogan.

One day, perhaps sometime soon, travellers wishing to transfer seamlessly from one low-cost carrier to another may be able to do so. The key word here is seamlessly.

At present, do-it-yourself travellers who want to connect from say Canada's Zoom Airlines to Ryanair or easyJet at London Stansted Airport have to collect their bags after their transatlantic flight and recheck them in for the European leg of their journey. Sounds pretty painful, but a surprising number do it.

There is no baggage transfer, or through ticketing, because there is no-one to pay for it. Certainly not the airlines involved. Many are seeking a way of "interlining" passengers where at least one leg of the journey involves a low-cost player, but the stumbling block keeps coming back to the payment question.

Recognizing the rising demand for such connections, airports are at least trying to help. Denmark's Copenhagen is the latest. It has designed a page on its website called "Via Copenhagen" that shows the 130 or so connections available. London Stansted created a similar page some while ago but after a quick check it seems to have disappeared.

Copenhagen has also gone a step further by tying up with an insurance company to offer travellers insurance against missing a flight.

But, as the Emerging Allies feature in Airline Business October suggests, the time when some traditional and low-cost players will need to resolve this issue, as their commercial ties grow, is approaching.

Seat backs that is. Europe's low-cost giant Ryanair is exploiting yet another opportunity for ancillary revenue generation by selling advertising on the seat backs across its fleet.

It has announced a deal with a company called InviseoMedia to install seatback advertising on its entire current and future fleet of 239 Boeing 737-800s. The "Inviseo Table" is a special tray table with an advertising panel built into it. Ryanair stresses that this latest money making venture will only make a couple of million Euros annually, but that every cent counts.

Ryanair is an arch exponent of raising ancillary revenues, which it is growing rapidly. The mainstays of this area are website click-through bookings for car hire, hotel and insurance. Other plans in the pipeline are the use of inflight mobile phones and inflight gambling.

In the seat back initiative, the trays are significant pieces of advertising real estate, being seen by the carrier's 40+ million passengers for an estimated minimum of 40 minutes per flight. Several advertisers are already interested, says Ryanair.

The first carrier to use this type of advertising was germanwings, which began installing them last year. Daimler Chrysler, Nikon, Pentax, Canon and Microsoft have bought space. The revenue is shared with the airline, with Inviseo handling the installation, handling and marketing costs. "Costs to the airline are virtually non-existent," says Inviseo. Now that is music to the ears of the Ryanair boardroom.

There are fewer greater joys in a Bavarian's life than drinking beer: Lots of it. And perhaps most remarkably, for many observers, at lunchtime after a mornings work and before a full afternoon's toil.

So it is with pleasure that we comment on the southern German tradition of beer drinking after a prompt from Munich Airport. It is gearing up for tomorrow's launch of the 2006 Oktoberfest, the world's largest beer festival.

The airport runs Airbraeu (see above), what it claims to be the world's only airport microbrewery and authentic Bavarian biergarten in the world. Airbraeu has brewed up 36,000 litres of fresh beer to thirsty Oktoberfest visitors so they can begin quaffing as soon as they step off the plane. This includes a batch of its own creation - Jet A1. If anybody gets a taste of this brew please tell us what it is like.

The airport has also outlined its top 10 - unofficial - survival tips for the festival. My favourite suggests dressing in traditional Bavarian garb to make the experience all the more memorable. So don't forget the lederhosen (for men) or dirndl (for women) if travelling to Munich.

The appetite for aviation acquisitions among Iceland's hungry investment community has again been highlighted with the purchase by Swedish budget carrier FlyMe of a majority stake in UK charter operator Astraeus.

The Icelandic link in this deal comes from investment company Fons Eignarhaldsfelag, which has a 20% stakeholder in FlyMe. It also owns Iceland Express, another low-cost carrier.

FlyMe says there are plenty of synergies to be gained from moving aircraft efficiently around the three carriers. It has a network of European routes from its Gothenburg base. Astraeus meanwhile flies to leisure destinations in Europe and Africa.

As the award-winning article Northern Raiders, written by Gunter Endres in the February 2006 issue of Airline Business, explains, Icelandic investors have been extremely active in the aviation market in recent years.

And there are short odds that there will be more action from this quarter in the not too distant future.