It seems like an almost impossible deal with. The Lufthansa Group, Air Berlin’s main competitor, signed a leasing contract with Air Berlin taking away 40 planes from its fleet. Air Berlin has been posting poor results and has recorded huge losses in the past few years, so it doesn’t come as a surprise that the airline must downsize its operations. What makes this situation so special is that the planes are being leased to its biggest competitor, the Lufthansa Group. Lufthansa will wet-lease 38 planes of the A320 family (meaning that it will lease the plane and the crew that will be flying it) and it will dry-lease two planes, also of the A320 family.
The contract is inked at six years and foresees that Lufthansa subsidiaries Eurowings and Austrian airlines will take over 35 and five aeroplanes respectively.
Air Berlin drops to 14th place in ratings
For Air Berlin, currently the 9th largest European Airline, this means that it will drop to the 14th spot and that it will need to figure out a new strategy for its operations. Currently, the airline plans to focus on business Travel. It will look into expanding its long-haul network from Berlin-Tegel and Düsseldorf with its 17 A330 aircraft. The airline also plans to shut down other focus cities in Germany in order to focus on making Berlin and Düsseldorf profitable for its operations. On the European routes Air Berlin plans to focus on the larger cities and will downsize its operations to holiday destinations, it has also been rumoured that it will lay a larger emphasis on cities in Eastern Europe.
Changes will start in summer
With all of these changes coming into effect by the beginning of the summer 2017 schedule, which is set to start by the end of March, the airline market in Germany will be changing, as Eurowings will look into expanding its offering in Europe with the 35 airplanes which will be joining its fleet.
The goal is to become more competitive to the likes of EasyJet and Ryanair, by offering cheap flights yet, through the slots from its parent company Lufthansa, be able to offer passengers a connection to the main operating airport. Currently, as an example, Eurowings offers low-cost flights to London-Heathrow and Paris-Charles-De-Gaulle, meaning that it gains an advantage in terms of connectivity.
Statement issued
Air Berlin’s CEO Stefan Pichler has had to calm the public down. According to aerotelegraph.com, the airline issued a statement assuring passengers that currently scheduled flights will be carried out as planned and that it will not affect the airline’s operation up until the new schedule is released. Air Berlin has 136 planes at the moment and with 21 of them being phased out and 40 leased to Lufthansa, the core fleet of 75 planes will leave Air Berlin with a mix of A330, A319, A320 and some Dash-Q400 propeller planes. The company hopes to turn a profit in 2017 through the income of the leasing agreement and the restructuring of the company. As for the employees, 1.200 jobs will be lost in the process with Air Berlin offering jobs at other airlines which also belong to the same investor as Air Berlin, Etihad Airways from the United Arab Emirates.
These include Air Serbia, Alitalia, Air Seychelles, Jet Airways, Etihad and a few others.
What started as an American airline company which connected the then isolated West-Berlin with the United States, turned into a German company and became Germany’s 2nd largest airline and Europe’s 9th, will now for the first time downsize in its history.
