Continental Airlines And Royal Dutch Airlines Announce Marketing Plans

Continental Airlines (NYSE: CAL and CAL.A) and KLM Royal Dutch Airlines (NYSE: KLM and AEX: KLM) today announced plans for a joint marketing initiative which is to include through check-in of passengers and baggage, reciprocal frequent flyer program participation, reciprocal airport lounge access, and, subject to government approval, codesharing on selected routes.

The two airlines have signed a memorandum of understanding and anticipate finalizing and implementing a comprehensive cooperative marketing agreement by the second quarter of 2000, offering the customer convenient connections and additional destinations. The memorandum of understanding is seen as another step toward building a strategic global alliance between Continental, KLM Royal Dutch Airlines, Northwest Airlines and Alitalia.


Once implemented, this agreement will enable Continental and KLM passengers to connect on flights operated by the other partner using reliable transfer facilities at the hubs in Houston, Newark and Amsterdam. In addition, members of Continental’s frequent flyer program, OnePass, and KLM’s frequent flyer program, Flying Dutchman, will benefit by being able to earn and redeem miles and/or points anywhere on either airline`s global route network. Furthermore, Continental and KLM intend to provide reciprocal access to each carrier`s airport lounges worldwide.


Upon receipt of all necessary approvals, Continental will place its “CO*” code on selected flights operated by KLM beyond its Amsterdam hub that connect to Continental’s daily flights between New York/Newark and Amsterdam. In addition, KLM will place its “KL*” code on selected flights operated by Continental beyond its New York/Newark and Houston hubs which connect to KLM’s flights between Amsterdam and these cities.


“KLM`s extensive global route network will increase options and convenience for Continental customers traveling beyond the Amsterdam gateway, as well as providing enhanced benefits to our OnePass members,” said Greg Brenneman, President and Chief Operating Officer for Continental Airlines. “We look forward to a successful relationship with KLM that will benefit the customers of both airlines.”

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“The importance of this agreement with Continental is that we are able to extend our service to the customers and offer more connections to more destinations through Continental’s hub in Houston and New York/Newark,” said Henny Essenberg, Managing Director of the KLM/Alitalia Passenger Venture. “We look forward to strengthening our agreement with Continental from this point on and feel that this is an important building block for a global alliance including KLM, Continental, Northwest and Alitalia. This alliance will give all partners a major competitive edge in a global market that demands global transport solutions.”


KLM Royal Dutch Airlines (www.klm.com) together with its partners serves over 500 cities in nearly 100 countries on six continents. Northwest and KLM have a well-developed alliance since 1992. Alitalia and KLM have formed a highly integrated partnership for the passenger and cargo businesses. As of November 1, 1999 the KLM-Alitalia Passenger Venture has resulted in the full integration of both companies’ global networks and commercial activities. The KLM-Alitalia Passenger Venture is in effect the largest airline in Europe in terms of number of passengers carried. KLM’s partner Alitalia has strong links with Continental.


Measured by international revenue ton-kilometers, KLM ranks sixth among the 250 plus members of the International Air Transport Association (IATA). KLM and Northwest Airlines were selected as co-winners of the Air Transport World Magazine “Airline of the Year” Award for 1997. This was the first time that an alliance won the award. In 1998 KLM was judged to be the “Best Managed Major Airline” by the industry trade magazine Aviation Week & Space Technology. In the same year Fortune Magazine ranked KLM the “Most Admired Company” in the airline category. The Institute of Transport Management (ITM) in the United Kingdom has nominated KLM for the award “European Airline of the Millennium.”


Continental Airlines is the fifth largest airline in the U.S., offering more than 2,100 departures daily to 129 domestic and 85 international destinations. Operating major hubs in New York/Newark, Houston and Cleveland, Continental (http://www.continental.com) has extensive service throughout the Americas, and to Europe and Asia. Continental recently initiated a strategic global alliance with Northwest Airlines.


Continental is in the top half of FORTUNE magazine’s “100 Best Companies to Work for in America,” and has won first or second place Frequent Flyer magazine and J.D. Power awards for four consecutive years. Continental has received numerous awards for its BusinessFirst premium cabin (Condé Nast Traveler, OAG Official Airline Guides, Entrepreneur and Smart Money magazines), OnePass frequent flyer program (InsideFlyer’s Freddie Awards) and overall operations and management (Air Transport World’s 1997 Airline of the Year).


In Europe and the Middle East, Continental serves 17 cities in 11 countries, operating 168 departures weekly to its U.S. gateway hubs at New York/Newark, Houston and Cleveland, with onward connections to cities throughout North America, Latin America and the Caribbean. For the second year running, Continental won the Gold Award for Top Airline to North America in the 1999 European Travel Awards, presented by Travel Trade Gazette Europa. BusinessFirst was voted Best Transatlantic Business Class among U.S. airlines in Condé Nast Traveler magazine’s 1999 Business Travel Awards poll, also for the second consecutive year.

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