PARIS — One of the world’s newest and most radical airlines, French bee, has entered the long-haul/low-cost market in a somewhat successful fashion.
French bee has joined into a congested industry trying to grab a market share where low yields and high competition are the norm. The carrier’s no-frills, long-haul, French-oriented model—not to mention its stunning blue livery—has caught the eyes of many around the world.
Airways visited the airline’s headquarters in Paris, where its President, Marc Rochet, revealed how he and his team made Frenchbee an early success.
Marc Rochet brings over a vast curriculum in the French aviation industry. His career began as an engineer in the Air Inter equipment Division (1976), then becoming Technical Director of Air Guadeloupe before becoming Director of Europe Aéro Service in 1982.
As CEO, Marc Rochet later merged Air Outre-Mer and Minerve in 1991 under the well-known AOM brand. From 1996 to 2001, he was CEO of the airlines TAT, Air Liberté, AOM, and Air Littoral.
In 2006, Marc Rochet founded and managed L’Avion, later acquired and successfully merged with OpenSkies in 2008.
Marc Rochet then became Chairman of the Management Board of French leisure carrier, Air Caraïbes, from 2009 to 2018, finally moving on to lead French bee as its President.
Marc, thanks for having us here in your Paris-Orly headquarters. Help us understand, how was Frenchbee conceived?
Frenchbee is a subsidiary of Groupe Dubreuil—a family group that has diverse businesses in France. This Group has also been managing another airline, Air Caraïbes, which happens to be the most profitable airline in the country.
When I sat down with Jean-Paul Dubreuil in 2014, our mission was to determine the strategy of the Group’s aviation sector. We were looking at different ideas of how to grow the business of Air Caraïbes.
We came across some arguments and, among them, was the fact that the name of Air Caraïbes incorporated the history, the culture, and the people of the French Caribbean (Martinique, Pointe-a-Pitre, Guadeloupe, French Guiana, Saint-Martin, etc.).
Roughly speaking, I’d say that almost 60% of the airline’s staff has strong Caribbean roots, including relatives and friends still living there. In our opinion, the company was already successful as a whole.
So, looking at things straight, we noticed that Air Caraïbes is head-to-head with Air France in terms of market share to the French Caribbean. So why change things when they’re working so well? We decided not to touch Air Caraibes at all.
And so the idea of launching an all-new carrier came to fruition?
At the time, we had the option to buy out another French leisure carrier. We set our eyes on Corsair, a well-established airline operating a fleet of seven wide-bodies—including the Boeing 747. We were very close to buying them out from TUI, but in the end, the deal was not signed.
We decided not to go through with the purchase on the very last day of our negotiations. Why? Well, for many reasons… but at the time, our options were to grow our company either by buying another airline or finding another path. So, what could we do?
We decided that the idea of starting up a French carrier ‘for the rest of the world’ was the right choice. So while Air Caraïbes serves the Caribbean, the rest of the world should be served by another carrier. We called it French Blue.
When did the long-haul/low-cost strategy emerge?
We all knew that we had to launch an airline with a different mindset. We had to offer the public a long-haul product with a divergent thinking, changed mind, different focus, and brand-new fleet.
French bee is a radical, no-frills option, whereas Air Caraibes is a full-service airline. Tell us about this dichotomy in the Group’s mindset.
The easiest way to put it is, Air Caraïbes is on a direct and equal part competition with Air France. Air Caraïbes needs different classes onboard its planes to properly compete against the flag carrier.
In the Caribbean market, we have a name, an old presence, a regional network. We’re flying ATR-72s in the French Caribbean. The product is entirely different from any other airline in the globe.
Also, we take care of public services in the region. There are different components of the market where the existence of Air Caraïbes is a real business generating factor. French bee, however, is targeted at an entirely different segment.
When we launched French bee, we knew that we’d have no notoriety, our name wouldn’t be recognized anywhere in the world. We said, ‘okay, let’s try and penetrate the market with what we already have.’
We noticed that, if you look at the premium market—including that of Air France or British Airways—it is roughly 10% to 12% of their market, bringing over about 30% of the airline’s revenues.
This part of the market is not growing; it’s quite stabilized—people who have to travel for business, have been traveling for a very long time. But in France, we have so many people who are not traveling at all. And that’s the target we are after.
So, how did the start-up process begin? Did you use Air Caraïbes assets to make this happen?
We started with an Air Caraïbes Airbus A330 to test the waters. As the concept was relatively new, we decided that, during the first six months, we would not operate our own French blue routes. Instead, we’d serve the route for Air Caraïbes, which had been flying Punta Cana since the very beginning.
Punta Cana is a low-cost, low fare market. It brings lots of tourists, families, people going there just for vacation. We knew that was our target, but we said ‘okay, we are not going to do it on our own. Punta Cana is part of the Air Caraïbes portfolio. But we can test our processes, understand better about the customer response, study feedback about the comfort of the airplane, food on board, entertainment,’ and so on.
I think it was a great test. When we saw that the numbers were strong enough, we gave the route back to Air Caraïbes and started making our own choices.
We opened our first flight to Reunion island, then San Francisco and Tahiti. We took delivery of two Airbus A350-900s.
A lot has happened so quickly! Let’s talk about what’s imminent: growth. Are you ready for it?
Our long-haul/low-cost airline is a new concept. We’re the first of our kind in France. Therefore, we must manage our growth. We’re not here to buy ten airplanes because it’s funny or ‘cool’ to buy ten planes. Sure—we can do it. But we will not do it. We’re not here to open new routes just because of the sake of it. We must be prudent.
I think some of the most significant issues with airlines like Air Berlin and Norwegian—to mention a few—is that they were not in command of their growth. We want to stay in control of our growth. Roughly speaking, we have decided that our growth is one long-haul airplane away, to make it simple.
When we opened up our newest route to San Francisco and Tahiti, we said that we would not be opening another new route because we must put a priority on being more efficient.
Today we have two A350s and one A330 in our fleet. This year, we are going to become an all-A350 operator. We’re giving back the A330 to Air Caraibes—a straightforward decision that will help us ensure that we are genuinely low-cost.
And how many more A350s are coming? I presume that with each new plane, a new route will be chosen.
We haven’t disclosed any new routes not because they’re secret, but because I can’t!
I know—when I say that ‘I can’t’ tell you the name of the route, you must think, ‘ah it’s a secret.’ But the truth is, we have about 15 routes under review. We’re looking at routes that are currently operated by Air France, Norwegian. We’re also analyzing new routes to the Indian Ocean, North America, and South America. We have a monthly internal survey into these 15 plausible destinations, asking ourselves whether there’s competition, current pricing, positive or negative, slot restrictions…
Probably, we will decide on a new route in 2020. The decision will be made based on our studies with the latest data, updated with the newest information. The variables are genuinely endless.
As far as new planes are concerned, we should have four A350-900s flying by 2020. Then one plane every year after that.
What made you choose the Airbus A350 over the competition?
Air Caraïbes has always been a big Airbus operator. It has both the A330 and A350 in its fleet. So the answer to the question is quite obvious. But if we jump back 15 years ago, it wasn’t so obvious.
In 2003, when we decided to launch long-haul operations with Air Caraïbes, we did look at other alternatives. At the time, Air Caraïbes was a very local airline in the French Caribbean trying to enter the long-haul market. We looked at both the Boeing 777-200(ER) and the Airbus A330-200.
I wouldn’t say one was better than the other one. We were entering a market where Air France and Corsair were flying with the Boeing 747, so in the sake of remaining conservative, we went with the smaller of the two. When you are entering into a new market, it’s always easier if you have a smaller airplane than a bigger one.
Then, five years ago, after having operated a fleet of four A330-200s and four A330-300s, we decided to move along to a newer plane. We reviewed the Airbus A330neo and the A350, and also studied the Boeing 787 and 777.
Of course, for us, it made more sense to stay with Airbus, and I must admit the negotiations with them went very well, not to mention that they’re right around the corner in Toulouse.
But I’d like to add that, when people ask, ‘which is the best airplane?’ there is no best airplane. The best one is the one that fits your network better.
If we were flying longer routes, we would probably have to choose the Dreamliner over the A350. But for our network and cabin structure, we need a big plane that is capable of carrying a lot of cargo. Cargo is 12% of our total revenue. We need big airplanes with big bellies.
We chose the A350, and I have to say we are pleased with our choice.
Tell us about French bee’s partnerships. Do you think you can survive in this business without partnerships, without interline, without codeshare?
This is under review. Up to now, we believe we are strong enough and have a strong enough market not to have a codeshare. Sure—if I codeshared with some carriers, they could bring us some customers, but not that many to make a significant difference.
So far, we have had a tactical codeshare with Corsair, because, at the time, Air France was a much bigger competitor than everybody, so we built a codeshare for Air Caraïbes and Corsair to balance the market.
Incidentally, we’re now questioning ourselves about that. I’m very prudent because all these codeshares, interlines, are very complex to manage. Complexity means more cost.
And, to be honest, today’s traveling population is rapidly changing. A lot of our customers—but not all of them, of course—can self-connect onto our flights. So for us, interlining or code sharing doesn’t make much sense.
But in French Polynesia, you must have a partner. Air Tahiti has a monopoly on inter-island transportation.
Yes. Of course, we do have a connecting agreement with Air Tahiti. But they only fly within French Polynesia.
Now that we’re talking about your furthest destination, how can a passenger fly for 22 hours to Tahiti in your high-density cabin, comfortably?
We want people to fly with low fare tickets in reasonable comfort. Part of the reason we chose the A350 is that its cabin is wider and more comfortable. The cabin altitude is lovely, more humid. It helps a lot.
We have installed the best seats and in-flight entertainment system we could find. And our Premium Economy has the best seats in the industry—the same seats you can find with Singapore Airlines.
We want people to pay less, but we want them to travel with a good feeling of comfort and quality. We think people should be convinced that they can fly low-cost on a small airline, with a different process, no business class, no complexity, but with a positive feeling about comfort.
I honestly think that when a customer books with Air France, they expect a higher-end service. They believe that because the price they’re paying is not the cheapest, the service they’re entitled to get is somewhat better. But when they buy a French bee ticket, they already know it’s a low-cost carrier, probably not as fine as Air France.
For us, the most important thing is what happens after the flight. The customer flying with Air France, most of the time, ends up quite disappointed. They say, ‘I paid a high price, the flight attendants were not very fair, etc.’
With French bee, however, the customer should say, ‘okay, I bought a French bee ticket, a bit lower-end service, but I got value for my money.’
And if we are successful in that, it will be a long success story.
Talking about added costs and happy customers who might soon be return customers, has French bee envisioned launching a frequent flyer program?
With Air Caraibes, we do have an FFP for our regular and business passengers. We don’t think French bee needs one.
We want to keep things simple. People often like FFPs because they get awarded for their loyalty. But sometimes, when they have hundreds of thousands of miles and cannot spend them when and how they want, they get frustrated. We don’t want to go into that complexity.
Marc, thanks for having us fly with you from San Francisco and visit your offices here in Paris. We wish you nothing but the best.
Up next — Trip Report on board French Bee’s Airbus A350-900, round-trip from Paris-Orly to San Francisco.