Costa/AirFrance – Targeting a Global Strategic Partnership

Costa Crociere, the leading cruise company in Europe and South America and Air France, one of the two airlines of the world’s number one air transport group in terms of revenue, have announced the signing of a letter of intent.

At a meeting held at the Air France head office, the airline’s chairman and CEO, Mr. Jean-Cyril Spinetta and his Costa Crociere counterpart, Mr. Pier Luigi Foschi, signed a protocol agreement setting down the details of a partnership aimed at boosting commercial synergies between the two companies.

Under this agreement, these two world leading transport companies will coordinate their schedules and capacities in order to provide their customers with additional benefits and services and allowing each partner to develop their growth.

As a result, the number of seats on Air France flights reserved for Costa Guests boarding one of the Italian company’s twelve ships deployed at a number of ports worldwide (from America to Asia) will rise substantially. Air France and Costa Crociere are to implement long-term plans to guarantee greater flexibility in terms of bookings and flight availability for Costa Guests.

This partnership also aims to improve the services offered to Costa Guests travelling with Air France, notably by improving assistance for Costa Guests at Paris-CDG and by setting up joint operating procedures, such as finding ways of harmonizing schedules.

This partnership also allows to develop commercial synergies. The ultimate aim is to allow customers of both companies to benefit from each partner’s loyalty programmes as well as other joint online marketing campaigns.

“We are very proud to be able to collaborate with a prestigious market leader like Air France,” stated Costa Crociere chairman Pier Luigi Foschi. “Our objective is to improve the quality and quantity of the airline seats available to our Guests. We are, in our own right, an innovative market leader and each year we offer new cruise destinations, from the Americas to the Far East, to our increasingly international clientele, who come from over 60 different countries. So a partner like Air France is particularly important for us”.

Jean-Cyril Spinetta commented, “On signing this agreement, Air France and Costa are committed to a long-term partnership, which will allow both our companies, European leaders in their respective market sectors, to pursue our future growth on a supportive basis. This partnership and the way we are building it together illustrate the special emphasis placed by both companies on their customers’ well-being. We both seek to provide our customers with the best possible service and offer them an even wider choice of products and services through a strategic cooperation. Focusing on the customer is a key value shared by Costa and Air France”.

Costa Crociere is currently Air France’s main customer in terms of “fly cruise packages”, while Air France is Costa’s main airline with regard both to revenue and to the number of passengers carried. In 2007 Air France flights will account for more than 20% of Costa’s air transport budget.

During the 2004-2007 period, the number of Costa customers flying Air France is expected to triple, making the Paris-Charles de Gaulle hub the main hub for Costa’s long-haul flights. In the winter 2007-2008 season, some 28,000 Costa Guests are expected to fly Air France en route to cruises operated by the Italian company out of Point Pitre ( Guadeloupe), Dubai, Miami, Hong Kong, South America and Mauritius (the latter being a new feature in Costa’s programme and the first time this destination will be served by the cruise industry). In 2007, Costa Crociere is expected to welcome one million Guests on board its ships, including 200,000 fly cruise package customers, i.e. up more than 30% on last year.

The alliance between Costa Crociere and Air France, strengthened globally by the signing of today’s protocol agreement, has its roots on the French domestic market, where Costa is the number one operator. From 1993 to 2006, the number of French Costa cruise passengers increased by almost 400%. Awareness of the brand by the French population has now reached 75%. Costa has also chosen the French city of Marseille to celebrate the christening of its new ship, the Costa Serena (112,000 tonnage and total capacity of 3,780 holidaymakers) on May 19. To mark this occasion, the Air France and Costa brands will be displayed side by side.

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