Transavia France, the low-cost subsidiary of Air France-KLM has aspirations to become the biggest low-cost carrier in the Paris market by 2019.
Speaking at the Routes Europe Strategy Summit in Aberdeen, David Sandier, Vice President, Network and Revenue Management, Transavia, told the audience that Air France have given Transavia France a goal to become the biggest low-cost carrier in the coming five years in the Paris market.
“We need to make the airline as profitable as possible in the really short term, we have all the strength to do it, and I am not worried about this,” he said.
It will be a challenge for Transavia France who are a relatively small carrier, with just 60 aircraft between them and Transavia Holland. Though the airline, which operates from Paris Orly is growing 30 percent year by year in the French market.
“Air France has given Transavia access to Orly which is a good opportunity for us – you cannot fly into Orly without slots,” added Sandier.
The airline is also benefitting from purchasing power from the Air France/KLM group, and has the advantage of being part of the Flying Blue frequent flyer program.
Sandier explained the trouble that legacy carriers face, which low-cost carriers can avoid: “All legacy carriers in Europe have understood that there is an underlying demand for air traffic, though the cost base of these legacies is not fit to capture this demand as well as making money at the same time,”
“There is so much capacity coming into Europe, it is not that easy to find a profitable market any more, there is competition everywhere and some players are trying to make their own moves though it’s complicated to do it with a profitable model,” he said.
Sandier added that in the coming years, the growth will be more linked to small underserved destinations which have not been looked upon by easyJet and Ryanair. Transavia has access to Orly and is growing in a closed market which is “easier to do.”
Fernando Estrada, Chief Strategy Officer, Vueling Airlines added: “You need to obtain the balance between growth and profitability and the key for us it to maintain a low cost-base as it’s the only way to compete effectively. We need to be efficient and give more to the customer without increasing our cost.”
Routes Europe Strategy Summit - Transavia