Sabena Flies Into The Black

<B> Sabena Flies Into The Black</B>

By Jay Campbell

John Lindekens would like to think the $10,000 diamond Sabena Belgian World Airways gave away at last month's National Business Travel Association conference was symbolic of more than just the carrier's 75th birthday. He'd like to believe it indicated that Sabena is back on track.

Lindekens, Sabena's vice president for North and South America since 1983, realizes that shrugging off a reputation for being unprofitable is no easy task, especially for a carrier that late last month reported its first mid-year profit since the 1950s. But two years of cost cutting under Paul Reutlinger, installed as chief executive in 1996 by 49 percent-owner Swissair, could be reversing a track that had Sabena reporting a full year loss for 1996.

Passenger totals were up 32 percent in the first half of 1998, thanks in part to feeds from partner carriers Austrian, Delta and Swissair. The deal earned Sabena revenues even on codeshare flights in which it plays no part.

The four carriers have a revenue sharing program on codeshare flights under which the carrier that flies the passenger and the one that sells the ticket each get 47.5 percent of the money, while the other two carriers get 2.5 percent each. On flights that continue beyond the international gateway, 100 percent of the revenue from the connecting flight goes to the operating carrier.

While retaining their individual identities, the four airlines are synchronizing their sales approach to the corporate market (<I>BTN,</I> April 27). They have taken on the "home carrier" approach where, for example, Delta negotiates with U.S. corporations on behalf of the other partners; the same goes for the other airlines in Austria, Belgium and Switzerland.

"For corporate accounts, this is easier because with one agreement you get four carriers," said Lindekens. "We, the partners, have to agree on whether an account is important to all partners, or just one or a couple."

Asked about the convergence of airport services by the partner carriers, Lindekens said,"In major locations, it's not a problem. But in some smaller cities, where there may be no codeshare operation, it could be that employees of each airline are still learning that we all have many of the same customers now."

One thing unique to the Delta-lead alliance, he said, is that the carriers swap inflight crews. On codeshare flights, there may be as many as two flight attendants from a partner carrier.

Sabena has doubled its transatlantic capacity in 1998, including flights to Cincinnati that hook up with Comair's all-jet regional network and a dozen or so codeshare flights there.

Sabena also is code sharing with City Bird and Virgin Express, two new entrants in Sabena's home of Brussels.

Including its codeshare arrangement with Virgin Express, Sabena is the second-largest operator into the United Kingdom after British Airways.