Last Thursday, June 21, the 5th edition of the Paris Air Forum was held, organized by Paris Airport and La Tribune. Its aim: to bring together air transport specialists, airlines, aircraft manufacturers, the military and start-ups to discuss the future of air transport in general, and in France in particular.

And despite my misgivings about the content, the debates were very interesting.

No real strategy for French air transport

This will be the most disappointing debate I have ever attended. With the president of the FNAM, the president of the UAF and two elected officials who work on air transport issues, the discussions focused on French airports and regional planning.

In the end, the real questions were not asked: the overcrowding of French airports in the regions, and the problem of excessive subsidies for certain routes, either to low-cost airlines or for public service delegations.

Moreover, the principle of delegation of public service was even reinforced by one of the elected officials present… Now, isn’t it a question of making the airplane attractive, and of encouraging competition rather than awarding contracts to airlines?

Aircraft manufacturers with a very clear future

The debate between Airbus and Boeing regarding aircrafts and their market has turned into a general satisfaction.

While each of the markets was discussed, the two aircraft manufacturers agreed that the Chinese market is the most dynamic at the moment, particularly in the mid-range segment.

About the entry-level aircrafts, Airbus and Boeing agreed that the trend was to use single-aisle modules for long-haul routes, hence the development of the Boeing 737 MAX and the Airbus A321LR, which make it possible to reach the East Coast of the United States and Canada from Western Europe

In the mid-range, this is where the offer is most dynamic, with strong competition between the Boeing 787 and the Airbus A350, These aircraft can be used both on long-haul and ultra-long-haul routes in an international configuration and on short-haul and medium-haul routes in a regional configuration, although Boeing notes that the latter trend is declining, in favor of more frequent routes on smaller modules, or on more direct routes.

About the high end of the market, the vision between Airbus and Boeing is changing: while Airbus believes (or at least continues to believe) in the Airbus A380, Boeing is not, Boeing believes that very large four-engine jets are no longer the priority, and that the large-capacity versions of their mid-range range will suffice, because according to them, the market has changed: from the hub-and-spoke of the 1990s, we have moved back to the most direct service possible.

In the regional market, while Airbus is chatting with Bombardier, Boeing has begun discussions on possible synergies with Embraer. Stay tuned!

The long-haul low-cost revolution not really taken into account by the French leader

Today, there is no longer any doubt: the long-haul low-cost movement has begun. In this respect, the discussion with Laurent Magnen, CEO of XL Airways and La Compagnie, and with Marc Rochet, CEO of French Bee and Air Caraibes was of particular interest. These two protagonists reached an agreement on almost all the subjects discussed, and insisted on two key elements for the success of a long-haul low-cost airline:innovation and courage.

In fact, the entire air transport market is changing. As a teasing nod to Air France and the GPs, as well as to corporate customers, for Laurent Magnen it is “the revenge of those who really pay for their plane ticket”. And leisure and VFR (Visit Friends & Relatives) customers now account for 80% of long-haul customers. « Beyond 5 or 600 euros for a round trip, it’s theft. Families, on the other hand, go on vacation counting each euro. “he adds. The audience is not smiling.

For Marc Rochet, the success lies mainly in a certain simplicity of the model: single fleet or very simple and very recent, means reduced to the mimium and without overstaffing. It is not possible to use the cost model of a standard airline and to cut back: a “zero-based budget” must be redone, and this is what all legacy airlines are doing (IAG with Level, LH Group with Eurowings, SQ with Scoot) to be efficient.

In any case, the key to being a good low-cost airline, in long-haul as well as in medium-haul, is to have the lowest possible production cost per seat, and a well-positioned Premium cabin. In addition to manage the low traffic of VFR customers from November 1st to April 30th each year.

In any case, the figures are clear: Low Cost in Europe is 50% of the offer in 2017 and 3x the growth of Legacy Carriers.

And our national airline has not yet understood this…

Bottom line

Many interesting debates during this day, where we see the dynamism of our small national players, as opposed to the national airline which, sometimes, seems disconnected from the reality of the market… No doubt entangled in its social problems!