Isochronous
Established Member
- Joined
- Dec 18, 2009
- Posts
- 4,679
I was fortunate to be able to attend a small briefing by Mr Vauramo recently. I thought I would share with the forum some of the key points from his remarks:
It was refreshing to see a Western airline with a proactive Asian strategy who have really made an effort to understand the market they are trying to serve. I think QF could learn a lot from their approach.
- A strategic decision was made to focus on developing new markets in Asia - they intend to double revenue by 2020. On Asian routes, Asian passengers account for 85% of pax with Finns/Europeans numbering just 15%
- AY fly to SIN, BKK, HKG, NRT, PVG, PEK, CHK, XIY, HAN, DEL, Nagoya, ICN, Osaka. North Asia is regarded as their core market.
- XIY (Xi'an) and CHK (Chongqing) have only been operating for a year or so. Chongqing struggled in year 1 but is now making money in year 2. Xi'an is going very well
- A deliberate strategic decision was made to target the secondary Chinese cities of Xi'an and Chongqing, as there is less competition from other non-Chinese carriers. AY is the only carrier offering a European flight direct from Xi'an, for example. This gives AY a first-mover advantage in those markets. Having made those two routes profitable, it means there are another 15-20 secondary Chinese cities that can be considered for future AY services with a realistic chance of them being profitable
- Chinese cabin crew to ensure adequate language skills on China routes
- The Asian routes enable 24 hour turnaround of aircraft and a 20hour daily utilisation rate to maximise returns from an airframe investment, as well as minimising crewing costs.
- For about 1 hour a day, HEL is busier than LHR when all the Asian flights arrive and connect on to other EU flights.
- The A350 will decrease fuel costs and increase freight capacity by 50%, which will assist in returning AY to profit. The purchase of these aircraft is seen as part of efforts to reduce annual operating costs by E150m.
- The Finnish Government owns 56% of AY. He expects that consolidation in aviation, which has already happened in the US and Western Europe, will eventually come to the North. As a small independent carrier, AY would welcome a larger investor so long as they support its business plan - which is promoting connections via HEL
It was refreshing to see a Western airline with a proactive Asian strategy who have really made an effort to understand the market they are trying to serve. I think QF could learn a lot from their approach.
