Concerto

Oh great, that's the end of airberlin then. And LH will behave exactly like BA when it becomes the de facto monopoly in Germany with beyond dreadful customer service and a service concept and brand destruction worthy of a 2nd rate low cost carrier. And let's face it, there is no successful low cost carrier that is second rate. I have no hope for the European legacy carriers any more, it's just a consistent, constant, continual mess. And don't get me started on the idiots that manage, so to speak, these companies.

Scrooge McDuck

Maybe, you are correct. But don't forget that AB problems are mainly related to AB mismanagement - almost a showcase for textbooks. AB would be history since long if EY didn't burn lots of $$$$$ in AB and it is quite understandable that they are seeking a way to get at least a part of their money back. It would make sense if EY would this way get a big shareholder of LH group and LH would open them up the door into *A which in turn would allow EY to get their lost money back.

fransknorge

RIP AB. I am glad I flew with them, they were a lovely outfit and a useful option into OW.
I fear what LH will do of them. It now has a monopoly in domestic Germany and the imprint of the LH group on the central Europe sky is stronger.

swiss_global

This is very bad news for us "flyers", i.e. passengers. You can see where the fares go, if you consider routes where there's no competition between LH and AB. E.g. ZRH-FRA this Friday same day return CHF 910 (LH group only, no competition), ZRH-TXL or ZRH-DUS both CHF 210 (competition between LH group and AB)

FlyerTalker688786

Hopefully Ryanair will get into the market!

MeltingAlf

Wait - are we talking about the total destruction of the AB brand, or a reduced offering that sees AB plying domestic and European routes?

Scrooge McDuck

That is a good question and we don't know yet. Clear is that AB will not be able to survive with the current business model and without support from EY (or LH in the future). That could mean:

Flying Lawyer

The SN brand will certainly disappear in the near future for intra Europe flights. I have a tough feeling that the same will happen to OS and LX short haul flights. Instead of these we will see Eurowings Belgium, Eurowings Switzerland and Eurowings Austria.

330

I totally agree except for Eurowings Switzerland, simply because LX has a premium image and only an idiot would rebrand a good functioning company (and brand) into Eurowings.

(Oh I forgot we are talking about LH )

Wtravel

Well, it's a safe assumption that this will lead to reduced competition on a number of routes, and it may be just as safely assumed that will lead to less competitive pricing on such routes... At least in the short term I also doubt that LCCs will want or be able to join the fray with a sufficient number of flights to have any significant impact. If EY really wanted to radically reorganize, maybe they should be merging with EK

ralfkrippner

Again from source Handelsblatt:

- EY is releasing its CEO Hogan
- EY is expected to quickly dis-invest from all european assets (AB, AZ, Darwin, Air Serbia), possibly in the form of a distress sale (with huge loss)

Strictly my own view of this from all the recent information: I would expect a quick solution for Lufthansa to secure everything that has a value for them (leased fleet, workforce, slots) and integrate it into its EW, OS or LH ops. AB as an airline will probably cease to exist and get into something similar to ch11-bancruptcy protection with some ongoing revenue from the lease of their fleet and some kind of contingent-work sub-company to lease out their workforce.

As time seems to be running out quickly, I would expect everything to be in place from March 2017 on with most flights untill winter 17/18 schedule to be offered by EW/LH/OS/some TUI brand with existing bookings staying on a codeshare AB flight or changed into a new flight number. Longhaul flights will probably go over 1:1 to LH and EW, maybe at a later date (winter schedule?).

I would expect Topbonus to be rolled over into EY's program with status match beeing offered by Miles&More.

Not a nice development in the time before christmas.

jugaadkabaap

Slightly OT. Apologies if it doesn't fit to the thread.

I am a novice - I hold an AB Gold and need around 30K status miles to re-qualify (june 17). As I moved out of europe (based at Canada now), I would need to do a status run to maintain the status. I am inclined on the program due to double benefits (EY alliance & OW) but confused due to uncertainties.

Considering the recent developments - is it wise to invest on a status run to maintain the status ? What will be the future of TopBonus (miles & status) ?

SK2751

Depends on your affinity to gamble. It is quite possible that interesting status match offers will be available when AB goes down. But nothing is certain, and you can't be sure that you will like these offers (they will match your flying patterns, etc).

MeltingAlf

Uh oh. I was hoping (against hope) that EY would keep AB in its domestic/European form, whilst selling selected prized assets over to Lufty so as to maintain liquidity of AB, recoup the millions they've lost in AB - since I would expect someone (read:EU/EC) to yell at Lufty if they monopolised the domestic market.

Is there any reason offered by Handelsblatt why EY is doing a fire sale of its European assets? I know the writing's on the wall with regards to AB and their massive losses, but AZ and Air Serbia were supposed to be doing rather fine as far as I heard.

Wtravel

AZ actually isn't, so one of their other problems (but harder to get rid of). I expect there will be some kind of anti-trust deal depending on the level of LH concentration, probably leading to LH having to give up some slots but not a blockage of the transaction(s). Don't forget the German government does not only have the interests of consumers in mind but probably more so those of a reasonably healthy LH (with LH having a better lobby than individual air travellers 😉, so the views of the German and especially EU competition authorities will not 1:1 be those of the government...