Brussels Airlines announced (26-Sep-2013) plans to introduce a new management structure for its operational departments which will report directly to Brussels Airlines CEO Bernard Gustin. Brussels Airlines COO Peter Kranich plans to leave the airline on 30-Sep-2013 with existing Brussels Airlines employees Dirk Vrebos and Thibault Demoulin succeeding Mr Kranich on 01-Oct-2013. From 01-Oct-2013 Mr Gustin will take over legal responsibility for the airline's activities. All ground operations including maintenance, airport services and security will fall under the responsibility of VP operations, deputy accountable, responsible for ground operations, security and maintenance Dirk Vrebos. This structure currently consists of around 1100 employees. VP operations, deputy accountable, responsible for flight operations Thibault Demoulin will be responsible for the airline's flight operations and will head the pilots, cabin crew and the operations centre of the company, amounting to around 1700 employees. [more - original PR]
Brussels Airlines to introduce new management structure in its operations departments
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Lufthansa's supervisory board has approved the exercise of its call option to buy the remaining 55% of SN Airholding, the parent company of Brussels Airlines. Lufthansa acquired 45% of the company in 2009 and negotiated the option to buy the balance of the shares for no more than EUR250 million. The deal is expected to close in early 2017, once the details of the purchase have been agreed with the other SN Airholding shareholders.
Lufthansa and Brussels Airlines have an extensive codeshare agreement and are partners in the Star Alliance. Their existing relationship is such that Brussels Airlines already feels like a member of the Lufthansa Group. The main draw for Lufthansa has always been its Belgian partner's extensive African network (it is the number two airline on Western Europe-Central/Western Africa).
However, it now seems that Lufthansa will, at least partly, integrate Brussels Airlines into its Eurowings low cost brand. Lufthansa is keen to accelerate Eurowings' expansion through partners (and is also to wet-lease up to 35 aircraft from airberlin). Brussels Airlines' fleet and single-class configuration on short/medium haul should fit with Eurowings, but its unit cost and network airline business model are not characteristic of an LCC.
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Part 1 of CAPA's analysis of Vueling examined its capacity growth and profitability trends since its acquisition by IAG in 2013. Vueling's operating margin and return on invested capital are on a downward trend, hence the new initiative to reverse these trends.
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