IAG home helps to keep low cost brand on the straight and level

Whether low cost brand LEVEL does eventually gain its own Air Operator’s Certificate (AOC) or continues its model of operational production units, its newly appointed CEO Vincent Hodder is certain that the business would struggle to exist if it didn’t have the backing of the International Airline Group (IAG) and its airline partners.


Summary:

  • LEVEL’s newly appointed CEO, Vincent Hodder, says the low cost brand sitting within the IAG structure is essential for its development;
  • In one of his first interviews since his appointment he said IAG sees the LEVEL brand as a test bed for new technologies and business models;
  • LEVEL aims to build a “customer centric, technologically enabled, airline business model of the future,” that breaks the traditional vertical integrated chain;
  • The business has adopted external production, subsidiary and franchise models to support its activities in Spain, France and Austria, respectively.

In one of his first interviews since taking up the role, he told The Blue Swan Daily on the sidelines of the recent CAPA -Centre for Aviation Low Cost Long Haul Summit that LEVEL sitting within the IAG structure is essential for its development. He said IAG sees LEVEL as a test bed for new technologies and business models, something that is clearly evident in the multiple models that support its activities in Spain, France and Austria, while for its long haul operations IAG provides the short haul feed to make the routes work.

Right now, despite now having its own CEO, LEVEL remains just a brand operating as an airline management company. “If you think about the customer being at the centre of what LEVEL is about and around the customer we build the brand, the commercial offering, the customer experience – all the way through from search and booking on the website to the airport experience, the travel experience and beyond – that’s the full responsibility of LEVEL as the airline management company,” explains Mr Hodder.

LEVEL aims to build a “customer centric, technologically enabled, airline business model of the future,” according to Mr Hodder, which will “break that vertical integrated chain so traditional in the airline industry which locks you into a particular way of operating, a particular way of delivering the product”. It deliberately separates the airline management company from the operating production units and they are very different in each of its markets.

These are the external production model where Iberia operates under the Iberia AOC out of Barcelona El Prat Airport; the subsidiary model with OpenSkies operating in France as LEVEL France; and the franchise model operated by Anisec Luftfahrt and branded as LEVEL Austria. “Three complete different business models operating across long haul and short haul, all designed to work together in a consistent way to deliver the overall LEVEL promise to the consumer,” explains Mr Hodder.

The former Flybe, VivaAerobus, Jetstar Japan, Jetstar Airways and TACA International Airlines executive had earlier delivered an insightful view on LEVEL’s plans in a keynote presentation at the CAPA Low Cost Long Haul Global Summit in Seville. He acknowledged that “we are now past the point of debate” in terms of the development of Low Cost Long Haul as “it is now part of the industry” and he predicts it “to grow at a significant rate”.

Low Cost Carriers had a big challenge in changing mindsets when they first disrupted the industry and the LEVEL CEO believes that it will be the same with Low Cost Long Haul as “we break down the walls”. He highlighted that LEVEL still has a long way to go to deliver on its aspirations, but says: “We need to build a model for the future and don’t infect it with the viruses of the past.”

LEARN MORE insights into the LEVEL business and the important role being part of a wider airline group is expected to play in the success of the Low Cost Long Haul model, in our exclusive CAPA TV interview with Vincent Hodder, filmed on the sidelines of the CAPA Low Cost Long Haul Global Summit in Seville in early Oct-2018.