Air Belgium, A Dynamic Airline Struggling to find its Vocation

MILAN – Air Belgium (KF) could soon be a European novelty for an integrated booking system but first it needs to find its true north.

Offering personalized choices to passengers, hence not waging a war on price, but on alternatives (flight plus ancillary products) is a strategy, perhaps the only one, that could work in the near future. Near means very close due to a critical condition, emphasized by the Covid-19 pandemic.

Airlines have always aimed at maximizing revenue by setting price seats, taking into account the willingness to pay for various customer segments. The future, however, will need a system that automatically adjusts prices to match those of competitors (Wang, 2018).

Unlike other large carriers that have started to adopt an integrated booking system, Air Belgium was born with a dynamic approach, so much so that it is in its founding values:

Koenn07, CC BY-SA 4.0 https://creativecommons.org/licenses/by-sa/4.0, via Wikimedia Commons

Strong and streamlined. “It’s not only our fares that make good sense. We place great emphasis on collaboration so that we can work in harmony to meet your needs,” it can be read on the company’s website.
Flying smart. “We focus on bringing you swift and comfortable direct flights, while letting go of anything unnecessary or wasteful.” This is a strong proposition, but it’s usually easier said than done.
Simply fly away. “From clear packages to helpful options and priority boarding, we make sure your experience is simple, smooth and fluid” (Air Belgium, 2021).

Nevertheless, it appears the airline has not yet found its vocation. And before integrating a fresh booking system, as it is already doing, it should completely clarify its role on the market.

Air Belgium, founded in 2016 in Mont-Saint-Guibert, started leisure operations in 2018 from Brussels Charleroi CRL airport (Noëth, 2017).

Despite good intentions, the first flight from CRL to Hong Kong was almost empty (Schlappig, 2018). It came as no surprise when the carrier announced the route. “The economical and operational conditions are not met to viably resume the service,” Air Belgium’s chief executive Niky Terzakis said.

In 2021 KF landed in the cargo world. By the end of the year, Air Belgium will replace two of its A340-300 aircraft with two Airbus A330-941neos, previously ordered by RwandAir, which took a step back during the pandemic in an effort to limit financial losses.

In 2020, Rwanda’s flag carrier canceled its order for the A330neos and confirmed that it wouldn’t even take delivery of two 737 MAXs (Harper, 2020). With the introduction of the new aircraft, Air Belgium plans to launch a twice-weekly service from Brussels BRU to Mauritius on 15 October (Air Belgium, 2021).

The airline had begun operations with four of the latest A340-313s built by European manufacturer Airbus. As reported by Planespotters.net, the aircraft was delivered to Finnair between 2007 and 2008, then they moved to Airbus Financial Services (AFS, the current lessor) for about a year and finally to KF in 2018 (Planespotters.net, 2021).

One, however, OO-ABE never wore the colors of the Belgian carrier. A plausible explanation could be that the company intended to use the plane exclusively for leasing contracts and a white, untitled livery would have facilitated the application of different decals.

The aircraft was indeed leased to Surinam Airways, which effectively suspended its flight operations (Ch-aviation, 2021).

This is another story. Surinam had decided to replace its old A340-313 (PZ-TCR) with a Boeing 777-200/ER on which the airline applied a wonderful livery (93% forest, 100% Surinamese), but it operated the only transoceanic flight to Amsterdam for a short time due to ETOPS certification issues (Ch-aviation; Schlappig, 2021).

Adam Moreira (AEMoreira042281), CC BY-SA 4.0 https://creativecommons.org/licenses/by-sa/4.0, via Wikimedia Commons

Between December 2019 and August 2020, OO-ABA wore a special livery with the beautiful tropical images of Martinique/Guadeloupe (Planespotters.net, 2021). It’s still unclear why the livery was removed, once again a logical explanation is the introduction of cargo operations in mid-2020 which actively involved Bravo Alpha.

Since February 2021, Air Belgium has also started operating cargo flights with four A330-243s freighters which used to fly for Qatar Airways Cargo. The aircraft, based at Liege LGG airport, is registered in Belgium but wears the livery of the French container transportation and shipping company CMA CGM (Air Belgium, 2021).

“In such an uncertain period, this is good news for the airline. We are delighted to be able to begin this diversification into the commercial and cargo sector, which my team and I know well. This will complement our existing passenger business which has been severely impacted by the current travel restrictions,” commented Terzakis.

Considering the current context, Air Belgium is therefore positioned in the middle, leaving a significant influence for both long-haul leisure and cargo flights. According to its website, KF could become one of the first small leisure carriers to adapt to IATA’s New Distribution System (NDS) through a Dynamic Offer Generation (DOG).

DS28, CC BY-SA 4.0 https://creativecommons.org/licenses/by-sa/4.0, via Wikimedia Commons

As has been shown, an integrated system can generate greater profits than an old Revenue Management System (RMS), responding in real-time to a booking request with a set of personalized offers (Fiig et al., 2018).

Sooner or later, it’s likely that all airlines will adapt themselves to the new system. In other words, each carrier will have its own marketplace, the Amazon of the skies… But also, of the ground. The customer must be able to purchase an almost complete travel experience directly on the airline’s website.

In the end, Air Belgium may be the forerunner, at least for the leisure world, of real innovation, but first, it must frame its position on the market, what it will be when it grows up.