The CEOs Of Etihad & Lufthansa Are Holding A News Conference Tomorrow…

Reuters is reporting that the CEOs of Etihad and Lufthansa will be holding a joint news conference in Abu Dhabi tomorrow, which follows expanded cooperation between the two airlines, and speculation of a closer partnership on the horizon.

The relationship between Etihad and Lufthansa is a new one, and is due to their mutual connection to airberlin — Etihad owns a big stake in struggling airberlin, and Lufthansa is essentially saving airberlin by taking over many of their planes, as a way of keeping other ultra low cost carriers out of Germany.

Despite Lufthansa’s previous vocal opposition to Etihad, the two airlines have extended their relationship beyond their connection to airberlin, and are now codesharing.

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We heard speculation that the two airlines may be considering a merger, though that seemed rather farfetched, and I don’t see that happening.

However, I also imagine the announcement goes beyond the few routes on which they’ve already announced a codeshare. So to speculate, what kind of expanded cooperation could we see between the two airlines?

  • Etihad may buy some sort of an equity stake in Lufthansa
  • Etihad and Lufthansa may expand their codeshare agreement
  • Etihad and Lufthansa may announce a joint venture for certain regions
  • While I doubt Etihad will join Star Alliance or Lufthansa will join Etihad Airways Partners, we could see them offer expanded reciprocity for flyers
  • They could expand cooperation in ways that don’t really impact customers, like maintenance, catering, etc.

Lufthansa-747

Personally I’d guess that this goes beyond maintenance or catering, but at the same time isn’t to the scale of an equity stake. Instead I suspect we’ll see an expanded partnership with more codesharing, and perhaps eventually this will lead to some sort of a joint venture.

What kind of an announcement do you guys think we’ll see from Etihad and Lufthansa tomorrow?

Comments

  1. “While I doubt Etihad will join Star Alliance or Lufthansa will join Etihad Airways Partners,…”

    Why Not either one?, I’m sure there will be earn and redeem miles on either program if they are partnering

  2. @ Mileage Man — Well, if Etihad were joining the Star Alliance I suspect it would happen in Frankfurt and be a Star Alliance announcement, rather than an Etihad announcement in Abu Dhabi. Furthrmore, Etihad has been working on building their own alliance for so long. Furthermore, I don’t believe Lufthansa can join Etihad’s alliance without leaving Star Alliance. Given their joint ventures with United, etc., I don’t see that happening.

  3. Yes, but I was think more in terms of a Full Non-Alliance partner for the purpose of earning and redeeming miles like Etihad has with American Airlines currently

  4. I wouldn’t completely dismiss the notion of EY in Star just yet. LH, unlike many other carriers, see immense value in the structure of the traditional alliances.

    Maybe that was one of the bargaining chips for LH in exchange for the burden of AB. There’s the unspoken benefit of weakening Skyteam in the process if LH can persuade EY to drag some of their partners over to Star as well.

    EY Partners can potentially bring some really juicy additions for Star (I know some of these might be pie in the sky)
    – Alitalia : allowing LH to regain the glory of the failed “LH Italia”, as well as a long term solution to Air Dolomiti
    – AirBerlin : keeping Ryanair at bay, with side benefit of clearing the air for Austrian too (read : NIKI)
    – Jet Airways : a premium alternative to the crapo Air India
    – Virgin Australia : this is the true crown jewel to replace the lost membership of Ansett

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