Aeroflot’s Low Cost Airline & Why No One Is Paying Attention

This past April Aeroflot, the Russian national flag carrier, announced it was considering launching a low cost carrier (LCC), as it takes over six smaller state-owned airlines in Russia.  Aeroflot’s low cost carrier announcement was lost among the stories related to Aeroflot taking over multiple smaller Russian airlines and the Russian government meddling in the airline’s future aircraft selection … however a few days ago Aeroflot announced their timetable to launching their new low cost carrier & charter airline …

Aeroflot plans to have the low cost carrier and charter airline fully established by 2025, with the hopes of increasing its passenger traffic from  its current 19.9 million passengers to 79.5 million passengers.

If you missed the date … yes I said by 2025 … 15 years from now. Fifteen years in the airline industry is an eternity for establishing and launching an airline.  To put this in perspective, the Union of Soviet Socialist Republics only collapsed 19 years ago and Aeroflot flew its first ‘Western’ produced aircraft 18 years ago, an Airbus A310.

The launching of a low cost subsidiary airline can be challenging. An airline needs to create a sub-brand to exist within the airline’s corporate structure. Aircraft must be either acquired or reallocated, ground and in-flight products need to be created and routes need to be established … among countless other details … however the creation of a low cost carrier does not take 15 years to implement.

How long has it taken other airlines to announce and launch their low cost carriers?

Well … United Airlines announced the creation of  its former low cost carrier, ‘Ted,’ on the 12th of November 2003 and launched ‘Ted’ exactly three months later on the 12th of February 2003. ‘Ted‘ launched with an all Airbus A320 fleet, which grew to 57 aircraft, sporting an entirely unique livery painted on the aircraft and a redesigned cabin, with dedicated gates at many airports.

BMI (British Midland International) created BMI Baby on the 24th of January 2002 and launched the low cost carrier, which still flies today, less than two months later on the 22nd of March 2002 with 14 Boeing 737s. Like United’s ‘Ted,’ BMI converted the 737s with entirely redesigned cabins and a completely new livery painted on the aircraft.

More recently, All Nippon Airways (ANA) has announced it will be creating a domestic and international low cost carrier based at Kansai International Airport (KIX). This new low cost carrier will launch within a year, as ANA needs to acquire new aircraft for the fleet, rather than reallocate aircraft as United and BMI did to create their low cost carriers.

Maybe Aeroflot will adjust their low cost carrier timetable once they finish acquiring the six smaller state-owned carriers … because announcing a subsidiary is to be created within 15 years is akin to scientists announcing that a glacier may some day collide with New York City.

Happy Flying!

Comments

  1. DEar Mr Frischling,

    thanks for very interesting interpretation of the AFL strategy.

    Probably its too late to enter into discussion about the topic written 2 yars ago.
    Unfortunately, every single piece of the information is given is incorrect. Numbers, dates, suggestions about brand and sub-brand are completely wrong.

    If I dare to reccomend you something… Next time talk to the source if you want to give a trully proffesional opinion.

    BRGDs

  2. Max,

    All of the information in this post came from Aeroflot’s media releases.

    Are you saying Aeroflot own media releases are not direct from the source?

    Happy Flying!

    -Fish

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