Insight into the Lufthansa-Etihad tie-up

Rival airline groups go from enemies to partners
Lufthansa and Etihad have fought over airberlin codeshare rights and alleged Gulf carrier subsidies. But now they are business partners, Karen Walker writes in an editor’s blog for ATW.
The two have completed a codeshare and wet-lease deal that links each other’s groups of companies, also involving airberlin, which is 29% owned by Etihad.
The Gulf carrier has agreed to wet-lease 38 airberlin A320 family aircraft to Lufthansa Group, which will deploy them on routes operated by both Austrian Airlines and, more importantly, the fast-growing Eurowings.
Lufthansa, meanwhile, will put its LH code on Etihad’s twice-daily flights between each other’s hubs of Abu Dhabi and Frankfurt and on the twice-daily Abu Dhabi-Munich. Etihad will add its EY code to Lufthansa flights from Frankfurt to Rio de Janeiro and Bogota.
Lufthansa Group chairman and CEO Carsten Spohr says: “We will consider extending our cooperation in other areas.”
It is the latest example of a legacy flagship airline and Gulf carrier becoming partners, following British Airways parent IAG with Qatar Airways and Qatar Airways entering the oneworld alliance. Qantas is cosying up to Emirates.
“The new partnership could yield returns across each group’s portfolios and make them more resilient to the competition and economic upheavals in their home markets as well as in the all-important transatlantic market,” Walker writes. “Most significantly, the Lufthansa-Etihad tie-up perhaps represents the end of any global attempt to constrain the Gulf carriers by regulatory means.”

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