Air Transport World

Mending Maersk: Danish carrier simplifies service concept, expands network in moves to stem losses.(Profile)(Maersk Air I/S)(Company Profile)

THE RAPID EMBRACE OF LOW-cost carriers by European travelers has sent shockwaves through the airline food chain, and although embattled former flag carriers may be shouting the loudest, the impact also is felt at those that formerly operated under the radar. Lacking a government owner/protector or a defendable niche, many of Europe's small privately owned airlines are in a competitive no man's land, caught up in the slugfest between money-losing legacy carriers and their LCC tormentors.

That's the situation facing Denmark's Maersk Air, which is transforming itself to meet the challenges of an increasingly price-sensitive air travel market. Executives believe the changes they are making will put the 25-year-old airline on a flight path to profitability after four years of red ink.

Maersk operates in a hotly contested neighborhood. Some 64 carriers serve Copenhagen Airport in a home market of just 5 million people with a catchment area that also includes 3.5 million residents of southern Sweden who have convenient direct rail connections to the CPH passenger terminal. To date, the airline's parent A.P. Moeller-Maersk Group, the century-old Danish merchant shipping and oil conglomerate, has been supportive, providing three separate capital injections aggregating Dkk 1.1 billion ($196 million) in 200304 to offset heavy losses at the carrier since 2000, its last profitable year. …

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