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Recorded at CAPA Airline Leader Summit, 17-18 May 2018

Eurowings Update: Europe’s Fastest Growing LCC And Its Digital Development

Eurowings CCO Oliver Wagner discusses the Eurowings development journey and how it is delivered tremendous growth within the Lufthansa group over recent years. He notes that this has delivered some complexities to the airline’s operations, but that the business is working to standardise its activities and looking at innovative ways to develop, such as recent marketing campaigns asking passengers to vote where it should fly. He says airlines are no longer facing competition directly from other airlines but also technology companies and he highlights why Eurowings has chosen to launch its own digital business.

Transcript

Oliver WagnerWell, I guess the journey started even in the middle of the 2000s with the German Wings when we set it up as our Lufthansa low-cost subsidiary, and a major first step was certainly the takeover of the Lufthansa non-hub services in 2013, and then we started the new Eurowings in 2015 with a tremendous growth ever since. We've basically doubled our size in the last two years. The first four months this year we had a tremendous growth, over 30%, so, of course consolidation has helped there, but we took the chance, and I think it was tremendous growth.

Well, funny enough, we were, of course, thinking of fostering our brand, of increasing our love brand, and so we had the idea of a co-creation, you know? We have the shared community, we wanted to do something new, so we said, "Why don't we ask our passengers where they want to fly to next season?" and so we came up with our You Vote, We Fly campaign. It was a huge success. We had more than 10 million participants, likes, followers on Facebook so that was, for us, it was something new. We tried it and it was a big success.

We have two dimensions of competitors. We have the airlines, and I think we have a good answer on competing in the airline industry. But of course we also have a digital component, digital competition. So I think it makes a lot of sense to bundle all our expertise, to grow there, to be close to the ecosystem, and to get more know-how. Our vision is to become a digital travel companion for our customers and I think, we are convinced, that it's the right way to do it in a separate entity, where this separate entity has to deal with different competitors.

Well, I think it's going to be fluid. We have already started a lot of digital initiatives, technology-wise or also towards the customers, and we will see certainly this year some more steps ahead. I guess we're going to be in a full swing next year, early next year.

Well, it has brought some complexity, definitely, you know? We had only a couple of months to integrate almost 80 aircraft. They're all not painted yet. We had only a couple of months to integrate, to hire more than 2,000 flight staff, so that's a huge thing. So far, I think it has gone quite well. As I said we have a huge growth in the past four months, but we'll do see some inconsistency in the brand until the end of the summer schedule and by then hopefully all aircraft will be repainted and all crew members will have their uniforms.

Well, you know, engines are there, aircraft are there, but we try to standardize as much as possible. We try to standard procedures, processes. We have very lean AOCs that provide the operation, so standardization is key. We do the flight planning, we do the crew planning all central for all our AOCs, so, yes, high degree of standardization and high degree of centralization wherever it's necessary.

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