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abhijith16
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 Posted: Tue Oct 07, 2014 12:03 pm Post subject: LH's new long-haul brand Jump to be launched, may resume HYD |
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Lufthansa long-haul for less
http://www.businesstraveller.asia/asia-pacific/news/lufthansa-long-haul-for-less
| Quote: | Germany’s Lufthansa is planning for two separate long-haul arms to revive and take over past and current long-haul routes from Germany to the Asia-Pacific.
In exclusive interviews with Business Traveller Asia-Pacific during the unveiling of the carrier’s new premium economy product (click here), Lufthansa said it is working to launch “Jump”, a leaner long-haul carrier than mainline Lufthansa, but still positioned far away from the LCC segment.
“Jump” is being positioned to potentially serve Hyderabad, Ho Chi Minh City and Qingdao – all routes the carrier had to terminate in recent years – and also to take over leisure-heavy routes (such as Bangkok) that do not warrant the use of aircraft with large premium cabins.
“Lufthansa had to terminate these routes in recent years [except for Bangkok] because the yields they produced did not meet our higher cost base – itself a product of high labour costs associated with cabin, ground and maintenance crew unions, and due to strong competition from the Gulf carriers,” said Andreas Bartels, head of communications for Lufthansa.
The initial eight designated “Jump”’ A340-300 aircraft will feature 18 business, 19 premium economy and 261 economy seats. Business class will feature its latest product, currently offered on the B747-8 fleet.
“‘Jump’ is not to be confused with the new long-haul low-cost carrier (LCC) Lufthansa is planning for service introduction in mid-2015,” said Bartels.
Frankfurt-based ‘Jump’ is “principally mainline Lufthansa, whereas the LCC will be part of its ‘Wings’ division and as such be based in Cologne, Dusseldorf or Munich and serve entirely different, more tourist-centric markets, for less money than both mainline Lufthansa or ‘Jump’ could offer,” he said.
Lufthansa has recently re-negotiated labour agreements with its A340 cabin crew to facilitate the service introduction of “Jump”, at 25 per cent less labour cost. |
Sounds like a plan. I'm not sure if it'll work, but if it does I believe newer markets like AMD could see service.
Thoughts?
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Nimish
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| Posted: Tue Oct 07, 2014 1:22 pm Post subject: |
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Sounds like Jet Airways/ Jet Konnect/ Jet Lite all over again?
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Spiderguy252
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| Posted: Tue Oct 07, 2014 3:24 pm Post subject: |
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When has this subsidiary format ever worked for any airline over the long term?
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The_Goat
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| Posted: Tue Oct 07, 2014 4:51 pm Post subject: |
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| Nimish wrote: | | Sounds like Jet Airways/ Jet Konnect/ Jet Lite all over again? |
Not quite.
Jump and Wings will be separate from the mainline parent in every way, with their own business model, dedicated fleet with a separate configuration, crew and everything else.
It is not going to be a setup where an A340 will do FRA-HYD as Jump, and return as LH mainline, like some Indian operators do.
The low yielding destinations can still be served by the subsidary using an aircraft that is configured in a way that allows better yields. All LH has to do is to put a codeshare on their subsidiary's flight, so the pax can connect from FRA on the mainline's network.
It is actually a good idea. It allows for flexibility and the ability to compete in different types of markets, thus increasing outreach.
| Spiderguy252 wrote: |
When has this subsidiary format ever worked for any airline over the long term?
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SQ's low cost subsidiary, Scoot, is working very well.
LH's subsidiaries, Condor is also doing very well.
It can be made to work, if proper thinking is put into the process.
'Proper thinking' being the operational phrase.
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Last edited by The_Goat on Tue Oct 07, 2014 6:01 pm; edited 1 time in total |
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Nimish
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| Posted: Tue Oct 07, 2014 5:31 pm Post subject: |
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^^Fair points.
Will this Jump be:
* Part of the *A for earnings/redeeming? Status honored when flying Jump?
* Part of the UA/ LH JV?
* Sounds like F&B will be like mainline.
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The_Goat
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| Posted: Tue Oct 07, 2014 6:04 pm Post subject: |
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| Nimish wrote: | ^^Fair points.
Will this Jump be:
* Part of the *A for earnings/redeeming? Status honored when flying Jump?
* Part of the UA/ LH JV?
* Sounds like F&B will be like mainline. |
If it is going to be like SQ-Scoot, it probably won't be a part of Star.
But some JV with the mainline to provide for connections should be there. Destinations like HYD will not work otherwise.
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I don't know which is the more pampered bunch : AI's widebodies (the aunties) or Jet's widebodies (the planes).
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iah87
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| Posted: Tue Oct 07, 2014 7:13 pm Post subject: |
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The article mentions that Jump will be operated as mainline, so it will likely be a part of LH/Star Alliance, something similar to Thai Smile. In addition it may be operating to BKK, an important city, I doubt if LH would remove it from Star Alliance
The last Indian city on LH network to lose service was CCU, but they have not mentioned it as a possible destination, and CCU has no European competition either. |
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jbalonso777
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| Posted: Tue Oct 07, 2014 7:30 pm Post subject: |
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Interesting set of names here
HOP! by Air France
Jump by Lufthansa...
What next, Skip by IAG?
My 2c 
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Jeh
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| Posted: Tue Oct 07, 2014 7:40 pm Post subject: |
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| jbalonso777 wrote: | Interesting set of names here
HOP! by Air France
Jump by Lufthansa...
What next, Skip by IAG?
My 2c |
I know that's in jest, but still - one good reason IAG won't call it that is because 'skip' in British slang means a large outdoor metal container into which people put unwanted objects, rubble or waste  |
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jbalonso777
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| Posted: Tue Oct 07, 2014 7:43 pm Post subject: |
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| Jeh wrote: | | jbalonso777 wrote: | Interesting set of names here
HOP! by Air France
Jump by Lufthansa...
What next, Skip by IAG?
My 2c |
I know that's in jest, but still - one good reason IAG won't call it that is because 'skip' in British slang means a large outdoor metal container into which people put unwanted objects, rubble or waste |
Did not know that, 
Thanks!
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sshank
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| Posted: Tue Oct 07, 2014 9:44 pm Post subject: |
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| The_Goat wrote: | | Nimish wrote: | | Sounds like Jet Airways/ Jet Konnect/ Jet Lite all over again? |
Not quite.
Jump and Wings will be separate from the mainline parent in every way, with their own business model, dedicated fleet with a separate configuration, crew and everything else.
It is not going to be a setup where an A340 will do FRA-HYD as Jump, and return as LH mainline, like some Indian operators do.
The low yielding destinations can still be served by the subsidary using an aircraft that is configured in a way that allows better yields. All LH has to do is to put a codeshare on their subsidiary's flight, so the pax can connect from FRA on the mainline's network.
It is actually a good idea. It allows for flexibility and the ability to compete in different types of markets, thus increasing outreach.
. |
Why a new subsidiary with a new name brand etc? Why not just have a sub fleet of high density aircraft for low yield destinations? |
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ameya
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| Posted: Tue Oct 07, 2014 10:58 pm Post subject: |
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I am not a big fan of this strategy. They will now have three brands – mainline, Jump and the LCC, all of which will be long haul.
The A343s will not help with profitability either. It is known that economy class along hardly makes money, so a combination of A343 with lower business class seats, and product differentiation will increase initial costs but not have good returns.
It may make sense to reconfigure and operate it as a small sub fleet v/s doing a marketing campaign and yet facing resistance on sales due to brand differentiation.
Also, this seems to have reduced Miles accruals and the LCC will not be part of *A
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The_Goat
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| Posted: Tue Oct 07, 2014 11:05 pm Post subject: |
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| sshank wrote: |
Why a new subsidiary with a new name brand etc? Why not just have a sub fleet of high density aircraft for low yield destinations? |
The idea is to have lower input costs (crew salaries, quality of the amenities offered etc) for low-yielding destinations. The only way LH can do this ( and not fall foul of the insane German labour laws), is by creating a subsidiary and getting them to fly the low yielding routes at a lower input cost.
They have had to do a lot of negotiating with the German trade unions to achieve this
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I don't know which is the more pampered bunch : AI's widebodies (the aunties) or Jet's widebodies (the planes).
-Jasepl |
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Nimish
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| Posted: Wed Oct 08, 2014 1:30 pm Post subject: |
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| ameya wrote: | | The A343s will not help with profitability either. It is known that economy class along hardly makes money, so a combination of A343 with lower business class seats, and product differentiation will increase initial costs but not have good returns. |
I heard the 343s were fully paid off and depreciated, plus there's no 2nd hand market for them. So the increased fuel costs will be offset by not having to pay the (say) $1m/month lease for a fuel efficient wide body.
| ameya wrote: | | Also, this seems to have reduced Miles accruals and the LCC will not be part of *A |
Yuck!
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ssbmat
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| Posted: Wed Oct 08, 2014 10:55 pm Post subject: |
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| Quote: | | The initial eight designated “Jump”’ A340-300 aircraft will feature 18 business, 19 premium economy and 261 economy seats. |
Now, really, what exactly is the difference to the long haul product here ? Less pitch ? Doesnt seem so. Paid meals ? Not feasible for longhaul ex-India atleast.
No entertainment ? Who cares for an 8 hour flight taking off at 2AM ?
Why bother to call it Jump ? They can simply continue to send the lower-end variants of the planes to fly pax at lower cost! Similar to Emirates sending those god-forsaken B777-200A models to India . |
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iah87
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| Posted: Thu Oct 09, 2014 6:52 pm Post subject: |
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| ameya wrote: |
Also, this seems to have reduced Miles accruals and the LCC will not be part of *A |
Is this a fact. I have not seen this come across in the news release.
If this is true, then HYD flight viability will be marginal especially for J and Y+ passengers. Quite a few J and Y+ originate in US and they have a choice of airlines, some may not choose because of this. |
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The_Goat
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| Posted: Thu Oct 09, 2014 6:59 pm Post subject: |
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| iah87 wrote: |
If this is true, then HYD flight viability will be marginal especially for J and Y+ passengers. Quite a few J and Y+ originate in US and they have a choice of airlines, some may not choose because of this. |
HYD is largely a low yielding, Y strong destination.
There is a reason why mainline LH (and KL) stopped operating there in the first place.
Among the European carriers, only BA is able to make it work, thanks to the 787 and the stronger O&D traffic.
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I don't know which is the more pampered bunch : AI's widebodies (the aunties) or Jet's widebodies (the planes).
-Jasepl |
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Jeh
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| Posted: Thu Oct 09, 2014 7:40 pm Post subject: |
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| The_Goat wrote: | | iah87 wrote: |
If this is true, then HYD flight viability will be marginal especially for J and Y+ passengers. Quite a few J and Y+ originate in US and they have a choice of airlines, some may not choose because of this. |
HYD is largely a low yielding, Y strong destination.
There is a reason why mainline LH (and KL) stopped operating there in the first place.
Among the European carriers, only BA is able to make it work, thanks to the 787 and the stronger O&D traffic. |
No doubt BA/AA's unparalleled North America network is also significant. |
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Nimish
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| Posted: Mon Oct 13, 2014 5:01 pm Post subject: |
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| iah87 wrote: | | The article mentions that Jump will be operated as mainline, so it will likely be a part of LH/Star Alliance, something similar to Thai Smile. In addition it may be operating to BKK, an important city, I doubt if LH would remove it from Star Alliance |
More details from: http://www.flightglobal.com/news/articles/lufthansa-to-transition-a340s-to-new-jump-platform-404588/
| Quote: | Lufthansa to transition A340s to new ‘Jump’ platform
Lufthansa will launch a new denser mainline platform dubbed ‘Jump’ internally with Airbus A340-300 aircraft by the third quarter of 2015, says chief commercial officer Jens Bischof.
“Jump is the first line of defence in long-haul and it’s not a separate brand,” he says aboard the inaugural revenue flight with the Star Alliance carrier’s new premium economy product today. “Jump is an adapted platform where we fly according to the market needs – no first class, relatively small business class, premium economy and economy.” |
So it's essentially the regular LH service, and the main difference being a high-Y config and lower contracted labor costs for these services. MAA/ HYD are the 2 Indian destinations mentioned - both make total sense and would probably do well with a high-Y config, lower crew costs and a paid off plane.
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