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Austrian Airlines On the quality offensive June  2007

Thanks to a new partnership with air charter company Jetalliance, Austrian Airlines' Business Class passengers can now book a private Citation jet feeder flight from anywhere in Europe to Vienna Airport at the same time as they book their long-haul ticket.

Describing the new service as part of Austrian’s so called “quality offensive”, the airline’s chief commercial officer, Dr Josef Burger, said: “We are broadening our feeder system, primarily for destinations which have not yet been opened by us or are not operated with high frequencies. We therefore achieve a better market exploitation, more customer value, and strengthen our market position.”

The key phrase in that first sentence is “not yet”; the key phrase in the second is "customer value". For although the new Austrian Business Jet service came on stream only in May, it's just the latest in a range of added-value innovations introduced by the airline this year.

At the most basic level, there are a number of new destinations. The Austrian Airlines Group, which includes holiday airline Lauda Air and regional carrier Austrian Arrows, now serves more than 130 points in 66 countries worldwide.

The addition this summer of six flights a week to Chicago takes Star Alliance member Austrian’s long-haul network to 10 cities, including major international business destinations like New York and Washington, Tokyo and Beijing, Delhi and Mumbai.

New flights to Burgas, the carrier's third destination in Bulgaria, and Estonian capital Tallinn, strengthen its reputation as the premier airline for Central and Eastern Europe, with the route map covering some 45 cities. In central Asia, where Austrian already flies to Baku in Azerbaijan, the Kazakh gateway of Astana is due to be added to the network this August.

Allied to new destinations, there are new achievements. The first quarter of this year saw Austrian report a whopping 46% improvement in pre-tax profits. More importantly from the passenger perspective, in the same period, the airline was recognised as the most punctual scheduled-service operator in Europe. It carried 3.1 million passengers, 4.4% more than a year ago.

There is lots of new capacity, too, with increased frequencies on routes to Erbil in Iraq and to the Iranian capital, Teheran, for example, as well as to Moscow and St Petersburg. At the same time, destinations such as Washington, Tokyo and Bangkok are benefiting from the introduction of new and larger Boeing 777s, which have reduced the average age of Austrian's fleet to 7.6 years, three years lower than the European average, and among the lowest in the world.

The same aircraft have enabled the introduction of many new products and services. Perhaps the most obvious is the new lie-flat seat, but there are better and more original differentiators. The airline’s Business Class menus are designed by some of Austria's leading chefs, but the finished product – the meal served to the passenger's tray-table – is refined to individual specifications by an on-board chef.

After dinner - and indeed at any time during the flight – Business Class passengers can take advantage of Austrian's unique Coffee House Service. In homage to the traditional Viennese coffee houses, this new in-flight perk involves a choice of almost a dozen coffees, each freshly brewed on demand.

On the ground, Austrian’s latest innovation – still in its infancy – is to negotiate deals with selected restaurants, museums and galleries to offer price reductions on production of a boarding-pass stub.

In common with many smaller national carriers, Austrian Airlines has faced plenty of challenges in recent years. But by focusing on a core network of business-critical destinations, and on Dr Burger's “customer value”, it has emerged as one of Europe's stronger niche players.

The key to the airline's success to date probably lies in the chief operating officer's second twoword phrase. At Austrian, the answer is not "no", but “not yet”.