Interview: Airberlin VP Titus Johnson

With a U.S. footprint that includes Chicago, Fort Myers, Los Angeles Miami and New York JFK, Airberlin this year will increase frequencies to the United States from its hubs in Berlin and Düsseldorf and also is set to debut in the coming months a lie-flat business-class product. That product should look familiar to passengers who have flown business class on Etihad Airways, as Airberlin will use the same design. Abu Dhabi-based Etihad holds a minority stake in Airberlin and has an expansive codeshare with the carrier, Germany's second-largest after Lufthansa. A member of Oneworld, Airberlin also counts as a "very strong partner" American Airlines, said vice president of sales and marketing for the Americas Titus Johnson. He recently spoke with BTN executive editor Jay Boehmer about Airberlin's partnerships and approach to the corporate market.

How much of your corporate business on the transatlantic is from the Germany point of sale and how much from the United States?

Out of Chicago, a significant point of sale comes from the U.S. market. That's partly due to the American Airlines connections. In Miami, for example, which is a big tourism market, it's mainly incoming. With the extra schedule, the strategy is to build a greater U.S. point of sale there. For JFK, it's just under half from the U.S. point of sale.

How much of your business demand is contracted corporate business?

We have over 1,000 agreements with corporates, so a lot of it is mandated. But also a lot of the business-class traffic comes from independent [corporate travelers] who want a better experience at a better price. They're not particularly mandated, so they've got freedom of choice. We're a young, fresh brand, so if they have an opportunity to try us, they take it. That's the path we're taking here in North America.

What's your approach to corporate deal-making?

We think we take a very pragmatic approach, which is to give a very good fare in the market and nurture the business. We're still a young brand here. We're very flexible in that regard. We work with a number of big companies in North America.

Are travel management companies a valuable sales channel in the United States?

It's fundamental to us. The lion's share of our revenue comes through the ARC channel. We have 80 agreements with travel agencies—80 separate managed agreements. We pick carefully who we work with, but it's been very successful. Of those 80, we've pretty much seen growth out of every one.

Do you also participate in corporate deals via Oneworld?

We are a participant. Airberlin has activity in several Oneworld contracts. Oneworld sets up the corporate agreement, and they ask [member] airlines to supply pricing. It's segmented, so the other carriers can't see it. There are several companies who benefit from Airberlin's corporate pricing via the Oneworld umbrella.

American is a key partner in the United States. What does its merger with US Airways mean for you?

The merger is exciting for us. We've got a growing number of code shares with American Airlines. As US Airways comes into the fold, we are confident that will open up new codeshare gateways for us, such as Washington Reagan and Philadelphia. For example, if you look at US Airways service from JFK Terminal 8 to Philadelphia, with approval, that could work well with Airberlin, feeding from Philadelphia via JFK to Berlin or Düsseldorf.

What about new U.S. markets? Will Airberlin put some new pins in the map?

Our strategy is to add service to our existing gateways and fill them up. We started as a seasonal player and developed into a very credible major operator out of, for example, JFK and Miami and Chicago. That's where the focus is. It's our strategy to fill frequency via our U.S. gateways either with our own metal or with partner airlines, such as American Airlines.

When will U.S. travelers get to try your new business-class product?

From the spring, every Airberlin aircraft with two cabins coming into North America will have the fully flat business-class product. There are only 19 seats, and that makes it more intimate than the competition. They're exactly the same beds that Etihad has on their business class, and Etihad has won a number of awards for their cabins. If you look at where the product has come in the past couple of years, we've really taken some very big steps to attract the corporate market with the right product, the right pricing, the right frequency and the right destinations.

What are some other examples of cooperation with Etihad?

One of the major strategies of the strategic partnership was to find synergies in all areas of both airlines' business, looking for opportunities, cost savings and efficiencies. That's been fundamental in the strategy of Etihad and Airberlin. It covers a whole range of disciplines—working together, pooling resources and sharing knowledge. There's people form Etihad who work in Airberlin headquarters. Airberlin is a regular visitor in Abu Dhabi.

I'm intrigued by what Etihad is doing in Europe. How do you play into that?

Etihad has been very successful by doing their own thing: taking minority shares in airlines, supporting them, developing them and [operating] through codeshares as well. We're a major part of that strategy. It's working very well for us. They're a tremendously strong partner and very supportive of Airberlin. When Etihad took the equity stake in Airberlin just over two years ago, there was almost no network overlap. Everything Etihad flew was east of Berlin and everything Airberlin flew was west of Berlin, essentially. So you just took a map of both networks, with no overlap, it was a very good mix. It's proven to be successful.

You've inked codeshares with other airlines in which Etihad holds a stake. How do you fit into Etihad Regional, the new brand stemming from Etihad's stake in Darwin Airline?

It's just another opportunity for us, where Etihad Regional goes, to link into that network.

What's up with the airport in Berlin?

It's not going to open this year, unfortunately. We want it to open. Unfortunately, Airberlin was the biggest loser when it didn't open because we built our schedule with the premise of a new Berlin airport being built. We've kept that schedule, but we're eagerly awaiting that to open. We'll be the biggest carrier there and have the biggest market share, and we look forward to developing business out of Berlin. That airport will give us a better opportunity to do so. When it opens, it will be superb.