Lufthansa ready to enter ITA Airways' capital, decisive week kicks off
A few hours after publishing this article came the official confirmation, also reinforced by the presence of MSC for [...]
Lufthansa
ITA Airways
Star Alliance
SkyTeam
A few hours after publishing this article is official confirmation arrived, also strengthened by the presence also of MSC to take over, along with Lufthansa, the majority of ITA Airways shares held by the Treasury.
In this article:
The rumors are becoming more and more persistent: Lufthansa seems ready to enter the capital of ITA Airways with a percentage close to 40%. With this deal, the Italian flag carrier would have the partner it has been looking for and could, at last, take off.
We created on FB a group Dedicated to discussions about the fly program, if you are interested sign up.
The highlight date is January 31. Indeed, a board meeting is scheduled for next Monday to present the carrier's business plan, which will be revised in light of the omicron variant and everything else that is happening in the world, for example, the rising cost of fuel and raw materials in general. Certainly, between shopping on our own or doing it within a one-stop purchasing center with Lufthansa that could guarantee huge savings for the start-up in the skies, the second option is more attractive.
What will happen
The transaction, if confirmed, will be subject to the approval of regulatory bodies, but should be a formality. With this heavy entry that, as explained by Altavilla, is not a simple marketing deal but a bet in which the German group would also put several million euros into the pot, ITA Airways from Cinderella would become part of an axis connecting the Mediterranean to the North Sea.
Lufthansa Group in figures
Lufthansa has more than 110,000 employees worldwide, had a turnover of more than 13.5 billion euros in 2020. The group led by CEO Carsten Spohr owns five airlines-Lufthansa, Swiss, Austrial, Brussels and Eurowings. As well as Lufthansa's Cargo division and Technik maintenance department.
At the end of 2020, Lufthansa Group's fleet included 757 aircraft, including 18 Boeing 747/8s. At present, the group has ordered another 177 aircraft to be delivered by 2022. These include 26 Airbus A350s and 20 Boeing 777xs.
All group airlines participate in the Star Alliance, the Miles&More loyalty program has more than 20 million members and Is the largest frequent flyer program in Europe.
Lufthansa's previous bailouts.
This is not the first time the German group has shopped around by going out and buying struggling airlines.
On the 22nd March 2005 acquired the airline company from the Swiss government. Swiss, which was created following the bankruptcy of Swissair. Four years later, in 2009, it fell to the Austrian flag carrier. Austrian was taken over entirely by LH for about 220 million euros. The latest purchase is that of the Belgian carrier Brussels occurred in 2016.
By joining the group, the three carriers have become profitable and organized again. Only Brussels is the one that, perhaps, has failed to deliver, but its proximity to Holland and KLM do not make things easy for the German group.
The precedent of Lufthansa Italy
Perhaps not everyone remembers that Lufthansa Had already attempted to "invade" the Italian market. In 2009, it attempted to occupy the space vacated by Alitalia, following its decision to abandon Malpensa by putting all its eggs in the one hub of Rome Fiumicino.
The experiment lasted just under 3 years during which, with 8 aircraft, the carrier connected Milan Malpensa with various European airports and also 3 domestic routes. Things did not go as planned, however, and eventually the experiment ended....
Why LH is banking on ITA Airways
There are several reasons for this, the first being that the Italian market for the German carrier is the largest outside the domestic market, this means that our country is the most important in terms of turnover and passengers carried.
The second is that ITA Airways' numbers are not Alitalia's.. Employees and fleet are now reduced to the bone, and the new aircraft ordered are fully integrated into the group's current fleet. Consequently, with this entry into the company, the German group avoids the risk of seeing the Italian carrier end up in the Franco/Dutch group and seeks to secure its own traffic.
Fiumicino hub in the southern Mediterranean
With this operation the German group in fact draws a line that cuts Europe in two, a kind of new Berlin Wall. From Belgium to Italy all airlines will be owned by the Frankfurt-based group, not to mention that other companies such as Aegean in Greece and Lot in Poland are members of the same alliance and have strong relationships with LH.
It is possible that Fiumicino could become the gateway to the heart of the Mediterranean, the largest airport in southern Europe in a strategy to intercept traffic to and from Africa and the East. However, it is not ruled out that Malpensa could also pick up traffic, as is the case in Germany where the German carrier's long-haul planes depart from Frankfurt and Munich.
Goodbye SkyTeam welcome Star Alliance
Here at TFC we have written about it several times, one of the causes of Alitalia's eternal crisis was that it was a second-class co-invitee to the aviation alliance table with Delta, Air France and KLM. At its inception, ITA Airways renewed its membership. to the old sky confederation, but did so only for 12 months. This was to limit the damage in the event of an exit to either competitor. The move to Star Alliance will therefore free AZ from the capestro agreements and allow ITA to be able to open, in agreement with Lufthansa, as many routes as it wants to all destinations in the U.S. and beyond.
Even today with ITA member SkyTeam there are so many inconsistencies that show how the signed agreement is far from reality. Sure, there are code-share agreements, but SkyPriority requirements are not provided, neither by ITA to AF/KLM passengers much less the other way around with access To Paris lounges off limits for AZ travelers. The same happens on re-routings by AZ: in case of cancellations, ITA customer care cannot re-route passengers left stranded on other SkyTeam airlines.
Now all that remains is to wait if the rumors will be confirmed or if there will be last-minute surprises.
