europeflyer

According to this article in the Chicago Tribune, LH is considering an investment in a merger between UA and CO. It seems like we may see a major shakeup in the airline business in the United Stated in the near future, now that a merger between DL and NW is more and more likely.

nyctravis

I like the idea as it seems to me (unless I'm missing something) that it would go a long way to solidifying that the new UA-CO would be more UA/*A heavy, i.e. MP would predominate rather than NonePass, E+, new UA C seats rather than CO features predominate. Wishful thinking?

Jalinth

Not particularly. Although it would put LH another step closer to basically being the primary NA/Europe airline for *A. Personally, *A does make more sense since SkyTeam has 3 US airlines, while *A has 3 NA airlines - one covering Canada (so not a huge amount of direct domestic competition with US based airlines), one that seems to be downgrading the premium product every week and should be dropped (US), and UA. So *A could pick-up UA/CO, drop US, have a credible presence in NY again (EWR isn't wonderful but at least it is a hub), and a more diverse international route map. It would also allow LH to eventually buy UA/CO and possibly merger it with B6 (or use B6 as a TEDish feeder) whenever politicians decide to do away with airline protectionism.

nyctravis

Agreed on all counts. US=kaka IMO. And living in NYC myself, it's hard to stay loyal to UA at times. Even though EWR not the most appealing, I would be so happy to have a real UA hub here.

Buster CT1K

I think it is increasingly likely that LH will make an investment in UA/CO. For one thing, UA and CO need the investment in order to merge, because of their cash-poor situation, just as DL and NW need AF's cash. For another thing, LH's investment will tie UA/CO to *A (which we all know is LH's creature) more permanently. Wins all around.

DownUnderFlyer

LH had EUR 1.5 bn in cash and cash equivalents at the end of September last year so they clearly are in the position to invest some money. Even their stake in JetBlue only cost US$300 which came out of petty cash.

So clearly this money needs a home. I wonder however what LH would like to do with those minority stakes in the US. Ultimately you would like to exercise control which currently is not possible. But maybe this changes.

In any way, a move of CO to Star Alliance would be very welcome. Skyteam will still enough coverage in the US but Star Alliance would gain a lot of additional routes in Central America and in the North Pacific.

Fantastic new destinations for a RTW.

whiskey_sk

Micronesia, here we come

everywhere

err... US$300 m right?

Rambuster

As long as foreign ownership rules in US airlines are not modified a minority investment has little merit in my opinion, especially with the US economy in a downturn in the foreseeable future.

I have a feeling the JetBlue investment was just to hedge LH's bets in the NA market should the consolidation developments in NA turn out negative for LH.

jason8612

I hope LH has no effect on the merger. I personally hate LH FF program (and with this I'm sure they'll find a way to use there M&M) and LH has no acknowledgment for *G members.

roundtheworld

jada jada jada

A) you can't hate it as you are not a member -- so you are not impacted by it.
B) LH is the only *A carrier that has 3 types of lounges, one for their HON Circle, one for SEN and one for FTL/C class.

as a *G you are welcome in the SEN lounge - so they do respect you.

If you complain about the HON Circle access rules - as a *G I can't have access at the IFL either. Even in *F you don't have access to the IFL - only if the airline has a contract agreement - so stop complaining

jason8612

A. I am a member of LH FF. Was a FT somewhere along the lines.
B. Yea, the SEN lounge thats about it which actually I got denied 3x so far to enter. No pre-boarding for elites and getting thrown out of the C check in once.

flysurfer

As funny as a broken record, and as relevant as to complain to NASA that they don't give him *G pre-boarding on the space shuttle.

jason8612

Yea, but they do get 1A seating regardless of status

flysurfer

Yeah, but the German guy got a bit sick on his way to the orbit.
They better offered him some compensation miles.