Qatar Airways to sponsor FC Barcelona, advertise on team's shirt

 Today we get into the fascinating World of football sponsorship, because it has been announced that Qatar Airways is going to become an sponsor of one of the World's top football ("soccer" for American readers!) sides: FC Barcelona. So we are going to see Qatar Airways on the FC Barcelona's shirt next season!

This deal consolidates the relationship between FC Barcelona and the emirate of Qatar (whose Qatar Foundation already sponsors the team) and mirrors similar sponsorship deals that top European football teams have sealed with the emerging airlines of the Gulf (the so called "MEB3"): Emirates is currently sponsoring English team Arsenal, Italy's AC Milan and is also adding FC Barcelona's arch-rival Real Madrid in the coming season, while Etihad Airways, of Abu Dhabi, and Qatar Airways are sponsoring Manchester City and Paris St.Germain, both owned by investors of their respective emirates.

The official accouncement, that can be found on FC Barcelona's website, does not disclose financial details, although sports daily El Mundo Deportivo reports that Qatar Sports Investments would pay €170 million for a six year sponsorship. Qatar Airways logo will then replace Qatar Foundation's one on the FC Barcelona shirts and merchandising. Apparently the possibility of replacing the sponsor's name was included in a clause of the original contract between FC Barcelona and Qatar Foundation.

Another point this announcement does not disclose is what is going to happen with FC Barcelona's current sponsorhip deal with Turkish Airlines. The Turkish flag carrier has invested heavily in sports sponsorship in its quest to position itself as a global super-connector and a competitor with the Gulf carriers and was, until now, the "official airline" of FC Barcelona. This relationship might be now "in the air" (if you allow me the bad joke).

By the way, all these airlines sponsoring several teams at the same time are starting to produce some slightly embarrassing situations: for example, a specially-painted Turkish Airlines aircraft flew FC Barcelona to the 2011 Champions League final, that the Catalan side played against non other than...Manchester United, a team that happens to have a similar sponsorhip agreement with the Turkish airline!

However, in this occasion, the final was conveniently played at Wembley stadium, in London, which made it unnecessary for Manchester United to fly...and, made a bit less blatant Turkish Airlines' alleged support for both teams!

Airline alliances & the Gulf carriers: if you can't beat them, join them!

Making new friends

Interesting times ahead for the airline industry...While old European, Asian and American flag carriers are still adapting to the tectonic shift that the emergence of the Gulf super-connectors (plus Turkish Airlines) has represented. We start to see another wave of strategic movements.

Today it's been confirmed that Qatar Airways is joining Oneworld, while Etihad has inked a codeshare agreement with Air France-KLM and Air Berlin (that despite being in Oneworld is partly owned by the Abu Dhabi carrier). And all of this with the Emirates-Qantas agreement that, although more limited in geographical scope than the three main alliances, promises to transform the Europe to Australia air travel market.

What next? A growing role for Turkish Airlines within Star Alliance? Emirates joining one of the alliances (they were talking with American Airlines' parent AMR) or creating its own alliance by striking deals similar to the Qantas one with other airlines?

What's clear is that the old saying still holds true: if you can't beat them, join them!

UPDATE: (or in this case it would rather be: "if you can't beat them, try to get them join you!)

First impressions about the Georgian airline industry

Where to start? The first impression upon landing in Tbilisi was really positive, Tbilisi airport is brand new. I liked it. It is spacious, yet,  it has about the right size for the traffic it handles (you won't get lost here!). There are also lots of natural light, all is very clean. Customs and immigration are swift and efficient.

It looks like Georgia has been making a big effort in marketing itself as a tourist-friendly country (for example no visas are required, most signs and indications are in English in addition to being in Georgian, there is free public wi-fi in the most central areas of the capital...) and the efforts are starting to pay-off. Foreign tourist arrivals are increasing in Georgia and so is the number of airlines that have started flying to the Caucasian country or are planning to do so, such as Aegean Airlines, Qatar Airways (via Baku), FlyDubai or Alitalia. In the meantime, Turkish Airlines seem to have the upper hand when it comes to connecting the country with the rest of the world (Tbilisi airport is also run by a Turkish company, TAV, that manages also Istanbul's impressive Ataturk airport).

One curious fact is that, contrarily to what happens at most European airports, it seems that most activity happens during the early hours of the morning, between midnight and 4am. This is the time when several scheduled flights arrive: Turkish Airlines from Istanbul, BMI (soon to be replaced by BA) from London (via Baku), Aerosvit from Kiev, Lufthansa, from Munich...

These schedules make sense when you take into account Tbilisi's geographical position, most of these airlines can extract an extra rotation from the aircraft by flying it to Tbilisi at night, gathering feeding passengers throughout the afternoon at their more westerly hubs and then feeding their westward-routes early in the morning with the return flight.

 One of Airzena's Boeing 737s

When it comes to local airlines, Airzena is Georgia's national airline and, although its network and schedules are currently somewhat limited, the flag carrier currently has several Boeing 737-NGs and 787s on order. It looks like Airzena is betting on the steady growth of the Georgian tourism industry, the Dreamliners order might be an indication that it is also looking to start flying long-haul (possibly to the US?)

Another Georgia-based airline is Sky Georgia, although currently focused on cargo only and with no scheduled passenger flights, according to Wikipedia, you can still this dilapidated DC-9 next to Tbilisi airport's runway...

Two new airlines are starting soon FlyGeorgia and Air Caucasus, and low cost airline Wizz Air is also starting flights to second-largest city Kutaisi. In short, a market that is really taking-off!

And, once you are in Georgia, if you wish to visit the country from a privileged angle and have some spare cash, you can buy this Mil Mi-8 VIP helicopter, apparently on sale on Alibaba.com!

The Spanish airline industry, in a state of flux

A constant flow of news is coming out of the Spanish airline industry, making it one of the hotspots of the industry in Europe, so I thought about writing this post to summarize what is going on...

One of the most amazing things is that the deep economic crisis that Spain is currently going  thorugh is not enough to deter Spanish airline entrepreneurs...one of the most exciting developments we have seen in last few months is the set-up of "stealthy" Barcelona-based airline startup, Volotea. Little is known about this project so far, except the identity of the founders, the fact that it is going to operate in the short-haul market and that its fleet is going to be composed of Boeing 717s. All these details, that were already advanced in the post I wrote a few weeks ago, have now been confirmed. Some reports in the press pointed also to the fact that it might not restrict its operations to the Spanish market only.

This is certainly an interesting timing to get into Spain's regional market, as the main incumbent in this segment, Air Nostrum is grounding up to 15 aircraft, reducing the number of staff and considering to move its headquarters from crisis-hit Valencia, on the Mediterranean coast, to the Basque city of Bilbao.

Air Nostrum operates many regional routes within Spain on behalf of Iberia

At the same time Vueling has announced an investment of €325 million and a major expansion at its Barcelona base, with 5 new Airbus A320 based there and the launch of 23 new routes. This will bring Vueling's total number of cities served from Barcelona to 70, which makes it one of the largest short-haul networks in Europe.

Vueling's recent network expansion strategy is also worth of note, not only from a quantitative but also from a qualitative point of view...I wrote not long ago about how Barcelona could fulfill its hub ambitions by having an airline develop a network linking it to second and third-tier cities around the Western Mediterranean. The aim would be to become the reference hub for this region, in a way similar to what KLM does with its links between Amsterdam and British and Scandinavian regional airports. When I wrote this what I had in mind was more of a regional type of operation (as KLM does) and I still have serious doubts about whether the Airbus A320 is the right aircraft for this type of operation based on thin routes, but Vueling's route map, particularly in France, with additions such as Bordeaux, Lourdes, Marseille, Nantes and Brest, and Italy, with Genoa, Pisa, Verona,...plus its new "connection flight" service seem to fit well with this strategy. Whether this will ultimately lead to the materialization of the much-awaited long-haul hub at Barcelona remains to be seen...

It is also noteworthy that Vueling is finally launching its first UK routes out of Barcelona (it flies already between the UK and several Spanish regional airports), a territory that, until now seemed reserved to the likes of Easyjet and Ryanair (by the way, the Irish airline has finally closed a deal with the Catalan government that will provide for 19 routes being launched or reinstated at Girona airport (GRO), just one hour drive North of Barcelona, BCN).

In the meantime, Barcelona's other carrier, Spanair, is languishing while awaiting its possible acquisition by Qatar Airways. Senior officials from the Catalan government and Barcelona City Council flew to Doha a few days ago to discuss the sale of Spanair to the Gulf carrier. As pointed out in this post, it will be interesting to see how petro-dollars affect the competitive landscape in the European airline industry. These negotiations, however, have not been obstacle for Qatar Airways to cooperate closely with Spanair's rival Iberia, to the point that it will be the only non-Oneworld airline to use Madrid's gigantic T4 terminal. Qatar Airways' passengers will also be able to use Iberia's domestic network for onward flight connections.

And I finish this post, precisely, with Iberia, as it is preparing the launch of its new low-cost airline Iberia Express. In reality, I think this move will be hardly noticeable to the average passenger: Iberia Express will be using the same aircraft and fly the same routes that Iberia already does, plus it will also offer business class. Iberia's on-board service on short-haul economy is already barely different to that of low cost airlines so not much of a change here either. So Iberia Express is more of a way to end a bitter labour dispute and lower operating costs in its short haul operations, a necessity for Iberia considering how entrenched Ryanair and Easyjet have become in the Spanish market, rather than the launch of a truly "new" airline.

Are European airlines becoming like football clubs?

This week we have got confirmation of the acquisition of a significant equity stake in Air Berlin by Eithad. The Abu Dhabi carrier will increase its stake to over 29% from the 2.99% it already owned, this will make it the first shareholder in Germany's second largest carrier.

What's interesting in this deal, though, it's not only that this is the first major foray by one of the emerging Gulf carriers in the European airline industry, although maybe not the last if we listen to the rumors coming out of Ireland, but the fact that this investment will have consequences that go beyond the financial sphere. And this raises important questions regarding the industry's competitive landscape.

As this CAPA thorough analysis underlines, Air Berlin and Etihad are going to be, from now on, close  partners: financially, as Etihad is injecting €255M in Air Berlin to help finance its fleet renewal and expansion, and also operationally, as Etihad and the airlines in Air Berlin group (including Austria's Niki and Switzerlands Belair) are going to codeshare routes across their networks. Air Berlin has already announced that is moving its Dubai service to Abu Dhabi to take advantage of the enhanced connectivity that its new partner provides. We can expect Etihad to benefit as well from Air Berlin's European network at the other end of the route.

Austria's Niki and Switzerland's Belair are also going to join forces with Eithad,a s they are part of the Air Berlin group

What this means, in effect, is that Lufthansa's long haul operation is going to be facing a larger passenger drain towards the emerging Gulf hub. Plus Air Berlin-Etihad have also the opportunity to develop an alternative German hub at Berlin's new airport, possibly not a coincidence that, in what looks like a preventive move, Lufthansa has recently announced plans to create a base in the German capital, an airport where it had had a very limited presence so far. It remains unclear whether this situation is going to affect Air Berlin's recent membership of Oneworld.

And it is precisely Oneworld who could be facing a similar situation in one of its home markets if Qatar Airways acquisition of Spanair is finally confirmed. As I write these lines the outcome of this negotiation is uncertain, although a deal must be closed soon as Spanair seems to be running out of cash. As I mentioned a few days ago, Qatar Airways would have its European beachhead, and, as in Berlin's case, it would be able to use a large brand-new airport with plenty of spare capacity to expand its European feeder operation.

Most important, and hence the title of this post, getting new entrants with access to a seemingly unlimited amounts of capital could significantly alter the competitive landscape (or distort it, depending on how you look at it)...which makes me think doesn't all this seem resemble what has happened with that other glamorous but chronically loss-making European industry:...football?