Eurowings opens new market for Lufthansa, and for Asia
Eurowings’ new low-cost flights to Thailand have opened up an entirely new market for the Lufthansa Group, focusing on price-sensitive leisure travellers, according to Dirk Grossmann, Lufthansa’s general manager for passenger sales in Thailand and the Mekong region.
Speaking to Travel Daily in Bangkok, Grossmann said the two new routes, which connect Cologne-Bonn Airport with Bangkok and Phuket, have achieved strong load factors since their launch in December 2015. But this appears not to have come at the expense of the group’s other Thai flights, operated by Lufthansa, SWISS and Austrian.
“The first flight to Phuket [on 19 December] was full, and also the outgoing flight had a high load factor. Then two days later we had the flight to Bangkok… [which] was full in and out,” Grossmann revealed.
“We are opening a new customer segment for Lufthansa Group. We don’t see decreasing passenger numbers in our Lufthansa, SWISS or Austrian flights – we keep the load factors. It’s a new target market for us.”
The new Eurowings flights operate on a low-cost model, with initial one-way fares starting from less than THB8,000 (approx. US$224). Passengers have the choice of booking a ‘Basic’ fare, which is essentially just a seat, or a ‘Smart’ fare which includes baggage and two meals. There is also a premium economy option that includes two meals, mileage, lounge access and extra baggage.
And this price-driven product is appealing a whole new audience, according to Grossmann.
“This is not only for the German leisure market, but also for Europeans. About half of the aircraft is sold by tour operators in Europe, but the other 50 percent are really price-sensitive individual travellers,” Grossmann said, adding that he believes the one-way fares will appeal to “a lot of backpackers, who usually fly one-way”.
Previous efforts to open low-cost flights between Asia and Europe have not seen long-term success. Most notably AirAsia X’s services from Kuala Lumpur to Paris and London were suspended in 2012 due to cost pressures. But Grossmann said he believes Eurowings has several factors in its favour which will ensure the flights’ long-term viability.
“The Eurowings product is available on all sales channels, via tour operators, via its own internet channel, via GDS, and via the general internet. This is really the difference to other low-cost carriers, which might me more restricted in terms of sales channels. And we generate synergies of being part of the Lufthansa Group, which is a strong partner,” he said.
“And most importantly, the whole Lufthansa network in Europe is feeding into it as well; it’s a worldwide network that connects to European and global destinations. Cologne is [located in] a very dense area with a large population, not only in Germany but extending into Belgium and Holland. People can drive from other countries in one or two hours from places like Brussels, Antwerp, Maastricht. The name is Eurowings; we don’t limit ourselves anymore to Germany.”
This confidence in the Eurowings flights is reflected in the fact that the airline has committed to operating the Thai services all-year-round, rather than seasonally. “Our plan is to make these flights stable, but will we increase frequencies? The market will show; if we have the demand and the capacity to increase, then we would do.
“Our priority is to run Eurowings as a reliable airline,” Grossmann concluded.
For the type of price-sensitive passengers that Eurowings is hoping to attract, this will certainly be an appealing option, compared to the ever-increasing number of one-stop flights between Asia and Europe. And with one-way fares available for less than THB8,000, Lufthansa is opening up a new market – not only for itself, but also for Asia’s tourism industry.
