by Lufthansa Flyer | Sep 10, 2016 | Air Berlin, Eurowings, Featured, Lufthansa |
What has been rumored and speculated for the past several weeks is set to become fact and reality. Lufthansa is poised to take over 40 of Air Berlin’s aircraft at at the same time take over approximately one-third of Air Berlin’s routes.
The decision is expected to be made at the upcoming LH Supervisory Board meeting scheduled for later this month and it is fully expected that the board will rule in favor. The timing works out well because this will allow Lufthansa to time the ‘take over’ of the routes and aircraft with the beginning of the Winter Timetable that takes effect on October 31. These flights will operate under LH’s Eurowings LCC division, and no, the aircraft will not be repainted to match EW or LH liveries!
This does not affect Air Berlin’s operations in Dusseldorf or Berlin. Flights to and from those cities will continue to be operated by Air Berlin.
Why is Lufthansa willing to do this?
Well, it’s basically taking a bullet for Air Berlin and trying to build out Eurowings at the same time.
Air Berlin is bleeding money faster than it can make it, and it’s Mid-Eastern overlord, Etihad, is becoming growingly impatient with operating results after making a substantial investment into AB’s business. If Air Berlin continues its current path, it faces no option other bankruptcy and being thrown on the pile of other failed European LCC airlines.
Lufthansa almost has no choice but to enter this unholy alliance with Etihad to help save Air Berlin. Otherwise, should Air Berlin disappear, the vacuum that would be created would suck in competitors such as Ryanair, EasyJet, Norwegian, etc. to fill in the void left by Air Berlin. Lufthansa is simply playing defense to protect their own market. As strange and unorthodox as it may appear, it is actually LH’s only choice if it doesn’t want to see even more foreign competitors flying in and out of German airports. At the same time, Eurowings is not big or successful enough to take on any void left by AB, so Lufthansa needed to step up and help cushion what appears to be the imminent failure of Air Berlin.
Should AB fail, at least Lufthansa is there to catch the pieces and immediately increase the size of Eurowings with the demise of AB. Lufthansa has said all along that Eurowings would be used to absorb other Euro LCCs should any of them be at risk of failure. Air Berlin will simply be the first airline to test LH’s experiment.
by Lufthansa Flyer | Sep 9, 2016 | Eurowings, Featured, Lufthansa, Munich |
The strategy of operating a low cost carrier SPECIFICALLY NOT out of a major hub has apparently been scuttled.
According to Eurowings boss, Karl Ulrich Garnadt, Eurowings (Lufthansa’s low cost carrier division) will begin operating flights out of Lufthansa’s #2 hub in, Munich. No date has been announced, but it was indicated that Munich operations for EW would begin sometime in 2017.
The rationale behind the change in the Eurowings business model is to stave off LCC competition that is beginning to build in Munich thanks to other LCC operators such as Easyjet and Norwegian among others. However, there are inherent risks with the idea, one being labor and the other being the impact on Lufthansa’s mainline operations.
As the Eurowings concept was built out, Lufthansa had worked with Unions to ensure that there would be no conflict of interest when it came to Eurowings and Lufthansa crews. Bringing the 2 carriers in direct competition in Munich may not sit well with Unions who typically have an itchy trigger finger when it comes to calling strikes for trivial reasons.
Another almost certain unintended consequence with this move is the risk that Lufthansa mainline operations will lose passengers to Eurowings. EW and LH would be in direct competition for the same passengers. Fares wars within the same airline group?
Not only will this impact short haul Munich operations for Lufthansa, it will almost certainly impact long haul operations as well. Booking a combination of EW and LH flights on one ticket is not an easy task, nor is the ability to connect from an EW flight to one operated by Lufthansa, and vice versa. A lot of systems work will be needed to marry the 2, and thats on top of Eurowings’ existing systems challenges that they are working through.
I see this as a reactionary move and an attempt to reduce the impact of non-LH LCC airlines in Munich, but in reality I don’t see how this will be possible since Eurowings is suggesting that only 4 or 5 aircraft would be assigned to Munich, hardly enough to make a significant impact on the competition, but enough to hurt itself and the parent company. EW already has its set of challenges and I think that they are stretching themselves a bit too thin in opening this new ‘front’ on the war against other LCCs. This defines dabbling and experimenting, not a commitment. Bandaids do not heal wounds.
It would be wiser for EW to be proactive and perfect their product that currently has it challenges and not enter a new arena with a business model designed for anything but operating out of major hubs, especially Lufthansa’s. Perfect the EW model so that it allows Lufthansa to consolidate other European LCCs into Eurowings when the opportunities arise. Don’t dilute what at best is a marginally successful unit (most would even argue that it is not yet successful).
In my humble opinion it’s a case of ‘Ready, Fire, Aim’.
I’d like to be proven wrong, but I wouldn’t bet against me.
by Lufthansa Flyer | Sep 3, 2016 | Featured, Lufthansa, Passenger Experience |
Lufthansa has officially joined the TSA’s ‘Pre-Check’ Program which allows for passengers to enjoy expedited screening at airports in the USA.
For Lufthansa passengers, it becomes especially valuable at their USA gateways since they can bypass the usually longer security lines that non Pre-Check passengers have to endure when traveling. For those of you not familiar with the program, Pre-Check enrollees are allowed to keep their shoes on while going through screening as well as being able to keep the contents of their bags in place. Cameras, computers, liquids, etc. do not have to be screened separately. Non US citizens can take advantage of Pre-Check as well, contingent on approval of US Customs via the Global Entry program.
To find out more about ‘Pre-Check’ and to apply, visit the Pre-Check website. The cost of the program for passengers is $85.00. If you are already in enrolled in Pre-Check, all you will have to do is enter your ‘Known Traveller Number’ during the booking process and you will be Pre-Check eligible when traveling. Keep in mind however, even if you are enrolled in Pre-Check, the TSA reserves the right to randomly have members go through additional screening.
In the past, LH had been resistant to join the Pre-Check program due to the substantial expense that is incurred as a result of updating computer systems to be compatible with the Pre-Check program. Glad to see that they changed their mind….
