Swiss Regional Rolls-Out Network Expansion

Independent Swiss regional carrier SkyWork Airlines is taking a much stronger position in the country’s scheduled aviation sector, bringing connectivity to the capital Bern. SkyWork is a relative newcomer to the scheduled passenger market but is making strong waves following the launch of flights to London City this week. The HUB spoke to the airline’s Chief Executive Officer, Tomislav Lang, this week to learn more about the airline’s growth.

Despite being new to this particular market, SkyWork actually has almost 30 years of experience having originally been formed in Bern in 1983 as a flight training company by Alex Gribi. He refers to its launch as a “crazy time” but outlines how the brand was selected. “Picking the name was not really too difficult: ‘Sky’ and lots of hard ‘work’ was what defined the company,” he said. In 1989, SkyWork acquired its first Cessna Citation business jet and moved into the private jet business as an air taxi and charter provider. Over the subsequent years it expanded its charter programme, introducing a Dornier 328 turboprop into its fleet for passenger charters in April 2004. It acquired a single Bombardier Dash 8Q-400 in April 2008 to further expand this area of the market, regularly flying Swiss tourists to Mediterranean Islands, Greece and Tunisia for tour companies such as Aartal Reisen, Kuoni and Xenotours.

However, as Tomislav Lang acknowledges “one of the major problems we faced was that while the summer season was doing well, in the winter, the aircraft spent most of the time on the ground.” The Croatian joined the company in July 2008 having previously worked at Stuttgart Airport and with low-cost operator Germanwings. He says that the past two and a half years have been “a real challenge” as the airline has modified its business model to safeguard its future. Since October 2010 he has been Chief Executive Officer of the company, and alongside Chief Financial Officer Hans-Peter Rothlisberger has masterminded the airline’s expansion in the scheduled market.

SkyWork first entered the scheduled market in October 2009 with flights between Bern and Rotterdam, and services to Barcelona followed in March 2010. Both routes performed well and the carrier began to get a loyal customer base due to its high-quality service. However, as the dynamics of the market changed as a result of the global economic crisis, things become tough. “I am not going to lie; we have had to work hard to keep the airline alive,” he said. Fortunately, its ‘work’ ethic was to be its saving grace in securing a much-needed cash injection, as Tomislav explains.

“We never actually had to go out and try to sell to any potential investors,” he said. “We were quite lucky that our new owner was impressed with the product we were offering and simply walked into our office after a couple of flights and asked if there was any opportunity for him to invest in the business. That was seven months ago. One month later we were building our new corporate strategy.”

A key part of the new scheduled business plan was the launch of a new corporate branding, which was introduced on October 20 last year and was followed two months later by the inauguration of scheduled links from Bern to Berlin and Hamburg, adding to its seasonal leisure connections to Palma de Mallorca, Ibiza, Elba and Djerba. “We had to make sure that we grew in a sustainable manner, plus we didn’t have the capacity to expand the network further,” said Tomislav. This has subsequently been facilitated by the acquisition of a second Dornier 328 in March this year.

“We actually looked at a range of different aircraft types before selecting the Dornier 328 and Dash 8-Q400 for our scheduled flights; two aircraft that we already had experience operating,” said Tomislav. “We eventually decided the turboprop was a better option to the jet from an efficiency and operational perspective, a decision that has been endorsed following the recent fuel price rises.”

However, for the longer term the company is looking at regional jets – candidates include the Embraer E-Jet family, Bombardier CSeries and the MRJ Regional Jet from Mitsubishi. SkyWork is an ERA member airline and will be at the spring meeting in Malta next week to renew contact with these OEMs.

Source: (Flightbase April 14-20, 2011)

SkyWork is now the largest operator at Bern Belp Airport, which is conveniently located for the Swiss Alps providing short transfer times to some of Switzerland’s finest ski resorts, including Interlaken, Adelboden, Grindelwald, Chateau-d’Oex, Kandersteg, Lenk, Murren and Wengen. The airport has the added benefit of handling a low passenger volume, meaning reduced waiting time at security, baggage reclaim and check-in – ideal for skiers and walkers wishing to spend longer on the slopes and for time-pressed business travellers. To tailor its product to its product to its clientele, the airlinehas developed its 'Personal Way to Fly' marketing strapline.It offers Swiss themed in-flight catering and importantly and especially attractive for the ski market, SkyWork is offering a free hold baggage allowance of 20kg per passenger, plus cabin baggage of 8kgs, while skis, boot bags and sports equipment can be carried for a 26 CHF (£17) surcharge. It also offers the use of iPads onboard, with ten available per flight.

“Bern Airport has never seen an expansion on this scale. The availability of flights used to be somewhat limited, now we are bringing regular, year round, routes, plus seasonal summer destinations. As the home base carrier of Bern Airport we are very pleased to be making a significant contribution to the development of Bern and offer our clients a real alternative to Basel and Zurich,” said Tomislav.

In the past week, at the start of the summer schedules, the airline has expanded its network to eight destinations with a new six times weekly flight to London City. This has been operated for the first week by a 31-seat Dornier 328, but will be upgraded from April 4 to a Dash 8-Q400. “We didn’t originally plan to use the Dash 8 until later in the year, once the route had matured, but people are booking like crazy,” said Tomislav. In fact, the airline was due to bring its Dash 8 to London City for the first time tomorrow (April 2) for a period of crew training. “Not content with the simulator work, we want our pilots to have first-hand experience of flying into the Docklands airport, so we will complete a number of training circuits over the weekend, before introducing the aircraft into the scheduled timetable next week,” he added.

The new service, the only direct flight between London’s premier business airport and Switzerland’s capital, means that visitors headed for the Bernese Oberland no longer have to travel to Bern via Basel, Zurich or Geneva, saving up to two hours’ journey time. Furthermore, the recent cessation of London City-Basel services means travellers destined for Basel can take SkyWork Airlines’ service and be in Switzerland’s second city within an hour by car.

Alongside its London launch, the airline is also planning to increase frequencies on existing routes, offering eleven flights per week to Berlin (up from six), six to Hamburg (from four) and a daily service to Barcelona (from six a week). “Our bookings are getting better and better,” said Tomislav, “and we are looking at average loads of between 54 and 60 per cent, which is what we need on the Dornier and Dash 8.” Alongside its direct sales channels, the carrier’s flights will be accessible on the GDS systems, Amadeus and Galileo from this month, while additional reservations are being secured by its travel agency in Bern, which sells holiday packages. Weekly seasonal flights to Djerba, Elba and Ibiza will also be resumed between May and October.

To support the next stage of its expansion this winter, SkyWork has already agreed deals to acquire two more Dash 8-Q400s. The first of these is already undergoing pre-delivery configuration work in Toronto, Canada and should be delivered by May. A third example should be introduced in October. “We are also finalising the purchase of a third Dornier 328 turboprop and hope to have this deal firmed-up in the coming few weeks to allow delivery this year,” said Tomislav. "this will take the SkyWork fleet to six aircraft by the end of the year."

These additional aircraft will be used to add a second weekday rotation on the London City route from September 5. New links to Milan Linate, Rome and Vienna will be added the same day, while Amsterdam, Belgrade, Budapest and Madrid will follow in October. The introduction of the Amsterdam link will actually mark the closure of the carrier’s flight to Rotterdam, its first scheduled destination.

The past year has been one of growth for SkyWork, but what will summer 2012 bring? “At this stage I honestly don’t know,” said Tomislav. “The problem is that Bern has never experienced such a strong network as we are now offering and there are therefore no statistics to base our future growth decisions on.” However, he does expect there to be “a few new routes” although acknowledges that some consolidation will be required. “We could look at Brussels, that fits our business model, but I think I need to be locked in a room for a few hours in September to look at the options and the data we have available.”

For the short-term the airline’s focus will remain on Bern but Tomislav believes there is potential to serve other Swiss markets, highlighting Lugano as one option. “We could look at basing one aircraft there in the future but that is a little way ahead.”

Elsewhere in the country, Independent carrier Baboo is to suspend its services from Geneva to Bordeaux, Bucharest and Toulouse this summer and will instead boost frequencies to Florence, Nice, Valencia and Venice and open a range of other regional destinations on a seasonal basis. The reorganisation of its network follows its purchase by Darwin Airlines last year. Florence and Venice will each receive a fourth weekly rotation, a second weekly Valencia service will operate between June 16 and September 22, and Nice will be served 17 times every week, up from 12 currently, although frequencies will drop to 16 flights per week from May 13 and to just eleven between July 8 and September 2. New twice-weekly seasonal flights will be flown from Geneva to Biarritz (June 6 to September 23), Ibiza (July 2 to October 2, operating three-times per week up until August 27) and St Tropez (June 17 to October 2), while a three-times weekly Nice – Venice rotation will be added from May 15. Baboo is the third largest airline from Geneva by weekly frequencies. It is the sole airline on the majority of these routes but does face competition from easyJet Switzerland to Biarritz, Ibiza and Nice.

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NOTE: Schedule data extracted from Flightbase for week commencing April 14, 2011; Traffic data extracted from IATA BSP system for the year ending January 2011.