Munich is more of a business centre/corporate HQ city than Frankfurt (which has become a financial and trade fair centre, but not much in manufacturing and processing). It is the base of BMW and BAYER chemicals, so I suspect this leads to lots of senior managers and execs flying peak business periods between the two cities in full paid J. If I were leading AC's sales force in Germany, I would certainly have staked out these giants for corporate accounts. This is one of AC's plum routes and I've always found both cabins full when I've flown it.

Also, AC and LH have lots of capacity ex-FRA with A330s and A340/B747s to sop up demand for full J and discounted C. There is probably 4/5x the ExecFirst/Business ex-FRA over MUC, so while FRA can be sold out frequently it won't be as consistently as MUC.

And as noted, MUC is being developed by LH as a secondary hub with lots of intra-Europe connections, less traffic and a more hospitable atmosphere than FRA (there are free coffee/tea kiosks at every third or fourth gate at MUC, lots of newspapers for the taking...easier connections to the city and onward.