Swiss International Air Lines continues to see its role as a niche premium carrier focused on high product quality and personal service, and expects its future competition to be greatest in the long-haul arena, particularly from fast-expanding Arabian Gulf airlines.
Low-cost carriers have given Swiss a "hard time" in the past, but their time for "real growth" is over, according to Holger Hätty, chief commercial officer at the Zurich-based airline.
He expects that budget and network carriers will become increasingly similar in the short- and medium-haul business while the main battleground for competition is shifting to long-haul routes. The "real competitors" are Gulf carriers, such as Emirates, which are moving the intercontinental hubs to the Middle East, he said.
In order to succeed in this changing environment, Swiss had to concentrate on trunk routes with sufficient passenger volume where it can compete with a high-quality product, such as air-cushioned seats and freshly-made food in first and business class, as well as personal service with "customer intimacy".
Hätty said that the airline had to emphasise its national origins and virtues, such as attention to detail and precision-engineering, which are typically associated with Switzerland. Catering, for example, is to reflect the nation's cuisine and be locally sourced.
Although airlines depend on small unit costs and high traffic volume, Hätty said that Swiss' small size was a strength in terms of providing personal service. Balancing cost versus product quality was "difficult", however, he conceded.
Business class will be the main area in which Swiss wants to defend its ground from competitors. While the airline will not update the first class on its Airbus A340s to the same standard as found on the newer A330s, its business class is coherent across the entire widebody fleet.
Swiss has replaced its former A330-200 fleet with A330-300s, the first of which was delivered in 2009. The current A330-300 fleet stands at 11 aircraft, with the latest (HB-JHK) having been delivered earlier this month.
One or two additional aircraft are to join this year and the A330-300 fleet will reach 15 by the end of 2013.
Swiss' long-haul business depends on attracting customers from the wider European market. While a sense of autonomy is deeply embedded in "Switzerland's DNA", Hätty said the "carrier cannot live off the Swiss people alone" and therefore needs to funnel passengers from other European countries through Zurich.
The airline's iconic predecessor Swissair tried to expand beyond the Alpine republic's confines by acquiring stakes in carriers such as Sabena, LTU and LOT, before it went bankrupt in 2001. Such moves would not be necessary in future, however, because the airline belongs to Lufthansa Group and is part of wider international strategy, Hätty said.
On Lufthansa's reported plans to centralise its subsidiaries' administrative functions, such as purchasing, Hätty said that certain synergies can be realised within the group. However, he added that the board's strategy for Swiss is to continue as a standalone brand with its own identity.