Swiss to hook up with Lufthansa
Mar 10, 2005, 9:04 pm
#1
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Join Date: Dec 2001
Posts: 3,181
Swiss to hook up with Lufthansa
http://news.airwise.com/story/view/1110484372.html
March 10, 2005
The chiefs of Lufthansa and loss-making Swiss International have broadly agreed on a planned union of the two carriers, a newspaper reported, citing Lufthansa sources.
Swiss's shareholders confirmed that talks in Switzerland have brought the two airlines closer together, Handelsblatt said on Thursday in a preview of its Friday edition.
Lufthansa chief Wolfgang Mayrhuber has guaranteed the continuation of the Swiss brand in an informal agreement, provided Swiss lowers costs further and the German carrier has control of Swiss's network, the paper said.
Lufthansa and Swiss declined to comment on the report.
Industry experts said last month that the two carriers were likely to reopen official takeover talks two years after Swiss rejected a previous tie-up attempt by Lufthansa in 2003.
Investors and analysts said Swiss has much more work to do to lower its cost base before an alliance would be possible, but added that Swiss's chances of survival were slim on its own.
Swiss, which has been run by ex-Lufthansa manager Christoph Franz since July, would provide Lufthansa with a hub at Zurich and lucrative business traffic.
An industry source said last month that Lufthansa's position had not materially changed since autumn 2003, namely that the airline remained open to discussions with Swiss. The aim is definitely to integrate Swiss with operational control on the German side, the source said.
Swiss has yet to make an annual profit since being born in a public-private bail-out from regional carrier Crossair and the remnants of predecessor Swissair, which failed in 2001.
(Reuters)
March 10, 2005
The chiefs of Lufthansa and loss-making Swiss International have broadly agreed on a planned union of the two carriers, a newspaper reported, citing Lufthansa sources.
Swiss's shareholders confirmed that talks in Switzerland have brought the two airlines closer together, Handelsblatt said on Thursday in a preview of its Friday edition.
Lufthansa chief Wolfgang Mayrhuber has guaranteed the continuation of the Swiss brand in an informal agreement, provided Swiss lowers costs further and the German carrier has control of Swiss's network, the paper said.
Lufthansa and Swiss declined to comment on the report.
Industry experts said last month that the two carriers were likely to reopen official takeover talks two years after Swiss rejected a previous tie-up attempt by Lufthansa in 2003.
Investors and analysts said Swiss has much more work to do to lower its cost base before an alliance would be possible, but added that Swiss's chances of survival were slim on its own.
Swiss, which has been run by ex-Lufthansa manager Christoph Franz since July, would provide Lufthansa with a hub at Zurich and lucrative business traffic.
An industry source said last month that Lufthansa's position had not materially changed since autumn 2003, namely that the airline remained open to discussions with Swiss. The aim is definitely to integrate Swiss with operational control on the German side, the source said.
Swiss has yet to make an annual profit since being born in a public-private bail-out from regional carrier Crossair and the remnants of predecessor Swissair, which failed in 2001.
(Reuters)
Mar 11, 2005, 12:21 am
#2
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Mar 11, 2005, 3:35 am
#4
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from my swiss bank's newschannel (UBS):
Lufthansa takeover of Swiss 'nearly a done deal' 11.03.2005 10:59:21: Lufthansa AG's planned takeover of troubled Swiss International Air Lines is "nearly a done deal", sources within the banking industry told AWP news agency.
The negotiations are far advanced, they added.
Earlier today, Handelsblatt cited company sources as saying Lufthansa CEO Wolfgang Mayrhuber and his counterpart at Swiss, Christoph Franz, have agreed on the broad outlines of a prospective merger.
The negotiations are far advanced, they added.
Earlier today, Handelsblatt cited company sources as saying Lufthansa CEO Wolfgang Mayrhuber and his counterpart at Swiss, Christoph Franz, have agreed on the broad outlines of a prospective merger.
SWISS legen um 21 Prozent zu - Lufthansa-Übernahme: Die Aktien der SWISS haben am Freitag nach Spekulationen über eine bevorstehende Übernahme durch die Deutsche Lufthansa um fast ein Viertel an Wert gewonnen. Um 10.50 Uhr betrug das Plus noch immer 21,26 Prozent auf 10,55 Schweizer Franken. Zugleich gewann der marktbreite SPI 0,49 Prozent auf 4.493,08 Punkte. Zeitweise waren die Aktien bei 10,80 Franken gehandelt worden.
Die Zürcher Kantonalbank (ZKB) sah in einer Übernahme eine "spekulative Kurschance". Allerdings sei zu befürchten, dass es zuerst zu einer größeren Kapitalerhöhung kommen könnte. Die Risiken für den Aktionär blieben groß.
Angesichts der Übernahmephantasien scheine es eine untergeordnete Rolle zu spielen, dass im laufenden Geschäft das Vorzeichen beim Swiss-Betriebsergebnis - plus oder minus - von der Umsetzung der jüngst beschlossenen Maßnahmen abhänge, hieß es am Markt. 2004 hatte SWISS International Airlines den Nettoverlust von 687 auf 140 Millionen Schweizer Franken verringert. Zugleich war auch der Umsatz von 4,126 auf 3,642 Milliarden Franken gesunken.
Die Übernahme der angeschlagenen Fluggesellschaft Swiss durch die Lufthansa ist laut gut informierten Bankenkreisen "schon fast unter Dach und Fach".
Die Verhandlungen seien schon weit gediehen, hieß es am Freitag aus den Kreisen
Die Zürcher Kantonalbank (ZKB) sah in einer Übernahme eine "spekulative Kurschance". Allerdings sei zu befürchten, dass es zuerst zu einer größeren Kapitalerhöhung kommen könnte. Die Risiken für den Aktionär blieben groß.
Angesichts der Übernahmephantasien scheine es eine untergeordnete Rolle zu spielen, dass im laufenden Geschäft das Vorzeichen beim Swiss-Betriebsergebnis - plus oder minus - von der Umsetzung der jüngst beschlossenen Maßnahmen abhänge, hieß es am Markt. 2004 hatte SWISS International Airlines den Nettoverlust von 687 auf 140 Millionen Schweizer Franken verringert. Zugleich war auch der Umsatz von 4,126 auf 3,642 Milliarden Franken gesunken.
Die Übernahme der angeschlagenen Fluggesellschaft Swiss durch die Lufthansa ist laut gut informierten Bankenkreisen "schon fast unter Dach und Fach".
Die Verhandlungen seien schon weit gediehen, hieß es am Freitag aus den Kreisen
Mar 11, 2005, 11:31 am
#5
Moderator: InterContinental Hotels and Germany
Join Date: Oct 2002
Posts: 6,572
Perhaps, it is a bit early to discuss a take over. FAZ from tomorrow:
Die Swiss peilt eine Partnerschaft erst später an
Wieder Gerüchte um Zusammengehen mit der Lufthansa /Erst will die Fluggesellschaft Gewinn erzielen/Noch immer kein Präsident
km. BASEL, 11. März. Swiss-Konzernchef Christoph Franz hat am Freitag eine neue Welle von Spekulationen über ein Zusammengehen mit der Lufthansa zwar nicht direkt kommentiert, indirekt aber die Gerüchte zumindest als verfrüht zurückgewiesen. "Unsere Priorität besteht darin, in die schwarzen Zahlen zu kommen und damit zu zeigen, daß wir uns aus eigener Kraft behaupten können. Das Thema Allianz oder Partnerschaft stellt sich erst später", sagte Franz bei der Bilanzkonferenz in Basel. Er reagierte damit auf Berichte, wonach Lufthansa und Swiss wieder Gespräche führten. Ein erstes Kooperations-Angebot war 2003 von der Swiss International Air Lines abgewiesen worden. Die Lufthansa hatte seitdem mit der Formulierung, sie habe die Tür nicht zugeschlagen, stets ihre Bereitschaft zu weiteren Gesprächen signalisiert. Die Swiss-Aktie stieg wegen der Gerüchte wieder einmal stark an, doch weil nur zehn Prozent der Titel im Publikum sind, ist der Kurs wenig aussagekräftig.
Da das Thema Lufthansa für die Swiss ein medialer Dauerbrenner ist, reagiert Franz regelmäßig mit der Formel "Kein Kommentar". In der Schweiz erwarten viele, daß die Swiss irgendwann mit der Lufthansa kooperiert. Doch um dabei bessere Konditionen aushandeln zu können, erwartet man solch einen Schritt erst nach Erreichen der Gewinnschwelle. Dies dürfte vielleicht schon in diesem Jahr, möglicherweise aber erst 2006 der Fall sein.
Im Vorjahr ist die Swiss, der 2002 gestartete Nachfolger der bankrotten Swissair, der Gewinnschwelle einen großen Schritt näher gekommen. Der Nettoverlust schrumpfte 2004 auf 140 Millionen Franken (91 Millionen Euro), nachdem er im Jahr zuvor noch 687 Millionen Franken betragen hatte. Erstmals schaffte die Fluggesellschaft einen positiven Mittelzufluß aus dem operativen Geschäft, so daß sich die liquiden Mittel (481 Millionen Franken) kaum noch verminderten.
Ob die Swiss schon 2005 die Gewinnschwelle erreicht, hängt nach Ansicht des Konzernchefs auch davon ab, welche Zugeständnisse die Gewerkschaften in der vor zwei Monaten angekündigten Sanierung machen. Es ist das vierte Programm in der Swiss-Geschichte. Man will bis Ende 2006 dreizehn Regionalflugzeuge stillegen, 1000 der knapp 8000 Stellen streichen und damit von 2007 an jährlich Kosten von 300 Millionen einsparen. Dank der verbesserten Kreditwürdigkeit hat die Swiss, anders als 2004, wieder Geld für die Preisabsicherung von Kerosin. Für 2005 wurden 27 Prozent des Treibstoffbedarfs durch Termingeschäfte gesichert.
Um das Drehkreuz Zürich zu verbessern, zieht sich die Swiss aus Basel zurück. Die Verbindungen sollen Partner-Gesellschaften übernehmen. Verhandlungen darüber laufen noch. In Genf ist der Swiss bereits eine Lösung gelungen: Vom 1. Mai an kooperiert man mit Air France auf der Strecke nach Paris. Statt der früher täglich 20 Verbindungen von Swiss und Air France wird es künftig zehn Flüge geben.
Einen neuen Verwaltungsratspräsidenten hat die Swiss dagegen noch nicht gefunden. Somit bleibt unklar, wer Nachfolger des Holländers Pieter Bouw wird. Da Konzernchef Franz ein Deutscher ist, muß wohl der neue Präsident ein Schweizer sein. Weil der Posten nach dem Swiss-Debakel und der mittelfristig absehbaren Anlehnung an einen großen Partner nicht sehr begehrt ist, kursierten teils kuriose Namen in den Medien, etwa der des ehemaligen Schweizer Botschafters in Berlin, Thomas Borer. Bouw teilte mit, man werde den Namen des neuen Präsidenten Mitte April nennen, wenn die Einladung zur nächsten Generalversammlung am 6. Mai verschickt werden muß.
Die Swiss peilt eine Partnerschaft erst später an
Wieder Gerüchte um Zusammengehen mit der Lufthansa /Erst will die Fluggesellschaft Gewinn erzielen/Noch immer kein Präsident
km. BASEL, 11. März. Swiss-Konzernchef Christoph Franz hat am Freitag eine neue Welle von Spekulationen über ein Zusammengehen mit der Lufthansa zwar nicht direkt kommentiert, indirekt aber die Gerüchte zumindest als verfrüht zurückgewiesen. "Unsere Priorität besteht darin, in die schwarzen Zahlen zu kommen und damit zu zeigen, daß wir uns aus eigener Kraft behaupten können. Das Thema Allianz oder Partnerschaft stellt sich erst später", sagte Franz bei der Bilanzkonferenz in Basel. Er reagierte damit auf Berichte, wonach Lufthansa und Swiss wieder Gespräche führten. Ein erstes Kooperations-Angebot war 2003 von der Swiss International Air Lines abgewiesen worden. Die Lufthansa hatte seitdem mit der Formulierung, sie habe die Tür nicht zugeschlagen, stets ihre Bereitschaft zu weiteren Gesprächen signalisiert. Die Swiss-Aktie stieg wegen der Gerüchte wieder einmal stark an, doch weil nur zehn Prozent der Titel im Publikum sind, ist der Kurs wenig aussagekräftig.
Da das Thema Lufthansa für die Swiss ein medialer Dauerbrenner ist, reagiert Franz regelmäßig mit der Formel "Kein Kommentar". In der Schweiz erwarten viele, daß die Swiss irgendwann mit der Lufthansa kooperiert. Doch um dabei bessere Konditionen aushandeln zu können, erwartet man solch einen Schritt erst nach Erreichen der Gewinnschwelle. Dies dürfte vielleicht schon in diesem Jahr, möglicherweise aber erst 2006 der Fall sein.
Im Vorjahr ist die Swiss, der 2002 gestartete Nachfolger der bankrotten Swissair, der Gewinnschwelle einen großen Schritt näher gekommen. Der Nettoverlust schrumpfte 2004 auf 140 Millionen Franken (91 Millionen Euro), nachdem er im Jahr zuvor noch 687 Millionen Franken betragen hatte. Erstmals schaffte die Fluggesellschaft einen positiven Mittelzufluß aus dem operativen Geschäft, so daß sich die liquiden Mittel (481 Millionen Franken) kaum noch verminderten.
Ob die Swiss schon 2005 die Gewinnschwelle erreicht, hängt nach Ansicht des Konzernchefs auch davon ab, welche Zugeständnisse die Gewerkschaften in der vor zwei Monaten angekündigten Sanierung machen. Es ist das vierte Programm in der Swiss-Geschichte. Man will bis Ende 2006 dreizehn Regionalflugzeuge stillegen, 1000 der knapp 8000 Stellen streichen und damit von 2007 an jährlich Kosten von 300 Millionen einsparen. Dank der verbesserten Kreditwürdigkeit hat die Swiss, anders als 2004, wieder Geld für die Preisabsicherung von Kerosin. Für 2005 wurden 27 Prozent des Treibstoffbedarfs durch Termingeschäfte gesichert.
Um das Drehkreuz Zürich zu verbessern, zieht sich die Swiss aus Basel zurück. Die Verbindungen sollen Partner-Gesellschaften übernehmen. Verhandlungen darüber laufen noch. In Genf ist der Swiss bereits eine Lösung gelungen: Vom 1. Mai an kooperiert man mit Air France auf der Strecke nach Paris. Statt der früher täglich 20 Verbindungen von Swiss und Air France wird es künftig zehn Flüge geben.
Einen neuen Verwaltungsratspräsidenten hat die Swiss dagegen noch nicht gefunden. Somit bleibt unklar, wer Nachfolger des Holländers Pieter Bouw wird. Da Konzernchef Franz ein Deutscher ist, muß wohl der neue Präsident ein Schweizer sein. Weil der Posten nach dem Swiss-Debakel und der mittelfristig absehbaren Anlehnung an einen großen Partner nicht sehr begehrt ist, kursierten teils kuriose Namen in den Medien, etwa der des ehemaligen Schweizer Botschafters in Berlin, Thomas Borer. Bouw teilte mit, man werde den Namen des neuen Präsidenten Mitte April nennen, wenn die Einladung zur nächsten Generalversammlung am 6. Mai verschickt werden muß.
Mar 11, 2005, 2:24 pm
#6
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Join Date: Dec 2001
Posts: 3,181
http://news.airwise.com/story/view/1110537196.html
March 11, 2005
Swiss International Air Lines remained silent on reports that it had broadly agreed a planned union with Lufthansa when it published detailed 2004 results on Friday.
Swiss has stuck to its independence even though having a partner is considered crucial for its long-term survival in an increasingly cut-throat industry.
In 2003, Swiss had been torn between joining Lufthansa's Star Alliance and British Airways' oneworld alliance. It opted for oneworld but those plans later fell apart.
Germany's Handelsblatt newspaper and the Financial Times Deutschland reported on Friday that the chiefs of Swiss and Lufthansa have broadly agreed on a planned union of the two carriers, citing Lufthansa and financial sources.
Swiss and Lufthansa have declined to comment.
Swiss said last year it was not in talks with Lufthansa and it would not worry about a partner until its operations were on track. Investors and analysts have also said Swiss has much work to do to lower its cost base before an alliance would be possible.
In a detailed statement of full-year 2004 results, Swiss reiterated it would be hard to break even this year if it failed quickly to implement cost-cutting measures, which include plans to cut 800 to 1,000 jobs and trim its regional fleet.
It also aims to cut net annual costs by about CHF300 million Swiss francs (USD$259.7 million) from 2007.
Swiss is in talks with unions and suppliers to implement the cost cuts but a union of pilots affected by the job cuts has already threatened to go on strike.
Created by grafting regional carrier Crossair onto the ruins of grounded predecessor Crossair, Swiss has already cut staff, its route network and fleet to stem losses.
Rising oil prices added CHF120 million (USD$103.9 million) to its operating expenses in 2004.
Swiss had sold its fuel hedges early last year to boost liquidity but then introduced a fuel surcharge on tickets to help offset rising oil prices.
But after securing a credit facility, Swiss hedged about 27 percent of its fuel needs for 2005 as of end-2004.
Swiss had said in February that its 2004 net loss had narrowed to CHF140 million (USD$121.2 million) from CHF687 million (USD$594.7 million) in 2003 thanks to cost cutting, and its earnings before interest and tax had narrowed to CHF122 million (USD$105.6 million) from CHF498 million (USD$431.1 million).
(Reuters)
March 11, 2005
Swiss International Air Lines remained silent on reports that it had broadly agreed a planned union with Lufthansa when it published detailed 2004 results on Friday.
Swiss has stuck to its independence even though having a partner is considered crucial for its long-term survival in an increasingly cut-throat industry.
In 2003, Swiss had been torn between joining Lufthansa's Star Alliance and British Airways' oneworld alliance. It opted for oneworld but those plans later fell apart.
Germany's Handelsblatt newspaper and the Financial Times Deutschland reported on Friday that the chiefs of Swiss and Lufthansa have broadly agreed on a planned union of the two carriers, citing Lufthansa and financial sources.
Swiss and Lufthansa have declined to comment.
Swiss said last year it was not in talks with Lufthansa and it would not worry about a partner until its operations were on track. Investors and analysts have also said Swiss has much work to do to lower its cost base before an alliance would be possible.
In a detailed statement of full-year 2004 results, Swiss reiterated it would be hard to break even this year if it failed quickly to implement cost-cutting measures, which include plans to cut 800 to 1,000 jobs and trim its regional fleet.
It also aims to cut net annual costs by about CHF300 million Swiss francs (USD$259.7 million) from 2007.
Swiss is in talks with unions and suppliers to implement the cost cuts but a union of pilots affected by the job cuts has already threatened to go on strike.
Created by grafting regional carrier Crossair onto the ruins of grounded predecessor Crossair, Swiss has already cut staff, its route network and fleet to stem losses.
Rising oil prices added CHF120 million (USD$103.9 million) to its operating expenses in 2004.
Swiss had sold its fuel hedges early last year to boost liquidity but then introduced a fuel surcharge on tickets to help offset rising oil prices.
But after securing a credit facility, Swiss hedged about 27 percent of its fuel needs for 2005 as of end-2004.
Swiss had said in February that its 2004 net loss had narrowed to CHF140 million (USD$121.2 million) from CHF687 million (USD$594.7 million) in 2003 thanks to cost cutting, and its earnings before interest and tax had narrowed to CHF122 million (USD$105.6 million) from CHF498 million (USD$431.1 million).
(Reuters)
Mar 11, 2005, 2:54 pm
#7
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Location: CH-3823 Wengen Switzerland
Programs: miles&more, MileagePlus
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I notice (from todays statements at the swiss press-conference and from LH) that, contrary to the past where such merger/take-over rumours between LX and LH were officially denied, this time it's 'no comments' from both sides - which makes this rumour (my interpretation) this time really serious @:-)
Mar 12, 2005, 2:11 am
#9
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Join Date: Dec 2001
Posts: 3,181
http://news.bbc.co.uk/2/hi/business/4340711.stm
Swiss 'not ready for merger deal'
Swiss has struggled to cut costs
Switzerland's loss-making national airline needs more time to reform itself before thinking about mergers, its chief executive has said.
Rumours have swirled for almost two years that Swiss may merge with Germany's Lufthansa.
But on Friday Christoph Franz said the priority was to complete rebuilding itself from the shell of collapsed predecessor Swissair.
Both firms' shares rose following the comments.
By 1340 GMT, Swiss shares were up 16.7% to 10.15 euros, while Lufthansa's shares rose 1.9% to 11.30 euros.
Back to the black
Mr Franz did not name Lufthansa as its potential partner.
But talking to reporters, he stressed that getting back into the black was the number one priority.
"I have always made clear... that we need to make sure we can become profitable," he said.
The company was formed from the ashes of Swissair in 2002, with the help of some 2.7bn Swiss francs ($3.6bn; £1.9bn) in fresh financing including some money from the state.
The company made a pre-tax profit of 20m euros in the final quarter of 2004, although the full year showed large losses.
Although talk of a partnership was "interesting", Mr Franz insisted that any deal would have to mean Swiss retaining its brand.
Swiss almost joined the Star Alliance group of airlines, of which Lufthansa is a member, in 2003 before backing away. It later repeated the performance with the Oneworld alliance which includes British Airways.
It remains a takeover target in the eyes of many observers, who often portray it as stuck between larger, stronger players and more successful low-cost carriers.
Swiss 'not ready for merger deal'
Swiss has struggled to cut costs
Switzerland's loss-making national airline needs more time to reform itself before thinking about mergers, its chief executive has said.
Rumours have swirled for almost two years that Swiss may merge with Germany's Lufthansa.
But on Friday Christoph Franz said the priority was to complete rebuilding itself from the shell of collapsed predecessor Swissair.
Both firms' shares rose following the comments.
By 1340 GMT, Swiss shares were up 16.7% to 10.15 euros, while Lufthansa's shares rose 1.9% to 11.30 euros.
Back to the black
Mr Franz did not name Lufthansa as its potential partner.
But talking to reporters, he stressed that getting back into the black was the number one priority.
"I have always made clear... that we need to make sure we can become profitable," he said.
The company was formed from the ashes of Swissair in 2002, with the help of some 2.7bn Swiss francs ($3.6bn; £1.9bn) in fresh financing including some money from the state.
The company made a pre-tax profit of 20m euros in the final quarter of 2004, although the full year showed large losses.
Although talk of a partnership was "interesting", Mr Franz insisted that any deal would have to mean Swiss retaining its brand.
Swiss almost joined the Star Alliance group of airlines, of which Lufthansa is a member, in 2003 before backing away. It later repeated the performance with the Oneworld alliance which includes British Airways.
It remains a takeover target in the eyes of many observers, who often portray it as stuck between larger, stronger players and more successful low-cost carriers.
Mar 12, 2005, 2:29 am
#10
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Join Date: Dec 2001
Posts: 3,181
http://www.swissinfo.org/sen/swissin...06&sid=5595642
Saturday 12.03.2005, CET 10:25
Swiss stays mum on Lufthansa link-up rumours
swissinfo March 11, 2005 7:34 PM
Partnership talks? Lufthansa and Swiss planes pass each other at Zurich airport (Keystone)
The national airline Swiss is saying nothing in the face of growing speculation that it is close to joining an alliance with Germany’s Lufthansa.
At the company’s annual results conference on Friday, CEO Christoph Franz said: "I have been asked this question at every press conference I have given [since I took over last year], and my answer is the same as always: no comment."
RELATED ITEMS
Swiss confirms 2004 loss
Bumpy ride ahead as Swiss clips its wings
Swiss pulls out of Oneworld talks
Swiss must prove it can decide its own future
Christoph Franz, CEO Swiss
Franz said the issue of a possible alliance was "bound to come up in future", but only once Swiss had become profitable and had proved that it was "in a position to decide its own future".
He said he was confident that the airline would make an operating profit by 2006, if not this year. But he did not say whether that would also translate into a net profit after financial charges (interest and taxation).
Asked to define the airline’s current strategy, Franz told swissinfo it was based on four elements: its "quality orientation", its "relatively young" airline fleet, its unrivalled offer to passengers travelling to and from Switzerland, and its central geographical location.
He said that, given these "advantages", he saw no reason why Swiss should not be successful in its chosen markets – provided it successfully continued to cut costs.
Franz also stressed that Swiss was committed to Zurich airport as a central "hub" for its operations, which fall into three main categories: regional, European and international flights.
Franz gets a pat on the shoulder from chairman Pieter Bouw (Keystone)
Whose strategy?
One analyst, who asked not to be named, said the CEO’s description of Swiss’s strategy sounded suspiciously like that of failed predecessor Swissair – and did not seem to take account of radically changed market conditions.
He said Franz and his management team had done a "very good job" of scaling down operations, getting costs under control and regaining the confidence of the financial community.
But he added that cost-cutting and a "hub approach" would not set Swiss apart from the competition since almost every major airline in the world is already doing the same thing.
Also, Swiss’s reluctance to say whether it intends to attain its goals through internal growth or together with a partner is seen as the missing "link" in its strategy.
Recent media reports say Lufthansa and Swiss have broadly agreed on the terms for a takeover, but unnamed officials were quoted on Friday as saying that Lufthansa is not likely to make any "quick decision".
Swiss still has the best muffins in Europe
UK analyst
Secret talks?
Swiss pulled out of talks with Lufthansa two years ago, but negotiations to enter the rival Oneworld alliance – dominated by British Airways – collapsed last year.
Over the past month, speculation that serious talks with the Germans are once again under way has continued to grow, but officials are quoted as saying that Lufthansa is insisting on secrecy.
Lufthansa is also said to be demanding an injection of extra capital into Swiss (at least SFr300 million), further productivity improvements (at least ten per cent), and resolution of current problems involving aircraft rental contracts.
The first element could prove to be political dynamite, if the federal government in Bern decides to pump any more money into Swiss following its initial injection of SFr2 billion several years ago.
However, chief financial officer Ulrik Svensson said on Friday that there were "no plans" for any capital increase this year.
Challenging conditions
The underlying logic of joining an airline alliance remains compelling – most analysts agree that the domestic market is simply not large enough for Swiss to survive alone in the long run – even if does claw its way back into the black.
Franz himself admitted that the airline was having a tough time in the face of rising fuel prices, "aggressive" competition and the ongoing political dispute over flight approaches to Zurich airport.
Globally, he said the airline sector was once again a growth industry following the post-2001 "stagnation" – but continuing over-capacity and fierce competition meant airlines were still suffering "fare erosion".
However, Franz pointed out that the carrier had substantially narrowed its operational losses from SFr703 million (including restructuring costs) in 2003 to SFr122 million (before interest and tax) last year.
He stressed that Swiss was now "generating cash on the operating level, not burning it" – operational cash flow rose by more than half a billion francs to reach SFr189 million in 2004.
As for strategic advantages, perhaps the final word should go to a UK banking analyst, who commented: "For my money, Swiss still has the best blueberry muffins in Europe – even if economy class passengers now have to pay for them."
swissinfo, Chris Lewis in Basel
Key Facts
- 2004 total income: SFr3.64 billion (2003: 4.13 billion)
- Operating loss: SFr122 million (703 million)
- Net loss: SFr 140 billion (677 million)
- Operating cash flow: SFr 189 million (– 340 million)
- Seat load factor – Europe: 60.8% (59.6%)
- SLF – InterContinental: 81.3% (78%)
- Yield (revenue per passenger-km) – Europe: down 3.2%
- Yield – IC: up 3.1%
In Brief
Swiss is refusing to confirm or deny reports of further partnership talks with Lufthansa.
CEO Franz insists that the airline must return to the black before it goes any further with possible plans for a strategic alliance.
But many analysts say such a partnership is likely – if only because it would fill the company’s "strategic gap".
Saturday 12.03.2005, CET 10:25
Swiss stays mum on Lufthansa link-up rumours
swissinfo March 11, 2005 7:34 PM
Partnership talks? Lufthansa and Swiss planes pass each other at Zurich airport (Keystone)
The national airline Swiss is saying nothing in the face of growing speculation that it is close to joining an alliance with Germany’s Lufthansa.
At the company’s annual results conference on Friday, CEO Christoph Franz said: "I have been asked this question at every press conference I have given [since I took over last year], and my answer is the same as always: no comment."
RELATED ITEMS
Swiss confirms 2004 loss
Bumpy ride ahead as Swiss clips its wings
Swiss pulls out of Oneworld talks
Swiss must prove it can decide its own future
Christoph Franz, CEO Swiss
Franz said the issue of a possible alliance was "bound to come up in future", but only once Swiss had become profitable and had proved that it was "in a position to decide its own future".
He said he was confident that the airline would make an operating profit by 2006, if not this year. But he did not say whether that would also translate into a net profit after financial charges (interest and taxation).
Asked to define the airline’s current strategy, Franz told swissinfo it was based on four elements: its "quality orientation", its "relatively young" airline fleet, its unrivalled offer to passengers travelling to and from Switzerland, and its central geographical location.
He said that, given these "advantages", he saw no reason why Swiss should not be successful in its chosen markets – provided it successfully continued to cut costs.
Franz also stressed that Swiss was committed to Zurich airport as a central "hub" for its operations, which fall into three main categories: regional, European and international flights.
Franz gets a pat on the shoulder from chairman Pieter Bouw (Keystone)
Whose strategy?
One analyst, who asked not to be named, said the CEO’s description of Swiss’s strategy sounded suspiciously like that of failed predecessor Swissair – and did not seem to take account of radically changed market conditions.
He said Franz and his management team had done a "very good job" of scaling down operations, getting costs under control and regaining the confidence of the financial community.
But he added that cost-cutting and a "hub approach" would not set Swiss apart from the competition since almost every major airline in the world is already doing the same thing.
Also, Swiss’s reluctance to say whether it intends to attain its goals through internal growth or together with a partner is seen as the missing "link" in its strategy.
Recent media reports say Lufthansa and Swiss have broadly agreed on the terms for a takeover, but unnamed officials were quoted on Friday as saying that Lufthansa is not likely to make any "quick decision".
Swiss still has the best muffins in Europe
UK analyst
Secret talks?
Swiss pulled out of talks with Lufthansa two years ago, but negotiations to enter the rival Oneworld alliance – dominated by British Airways – collapsed last year.
Over the past month, speculation that serious talks with the Germans are once again under way has continued to grow, but officials are quoted as saying that Lufthansa is insisting on secrecy.
Lufthansa is also said to be demanding an injection of extra capital into Swiss (at least SFr300 million), further productivity improvements (at least ten per cent), and resolution of current problems involving aircraft rental contracts.
The first element could prove to be political dynamite, if the federal government in Bern decides to pump any more money into Swiss following its initial injection of SFr2 billion several years ago.
However, chief financial officer Ulrik Svensson said on Friday that there were "no plans" for any capital increase this year.
Challenging conditions
The underlying logic of joining an airline alliance remains compelling – most analysts agree that the domestic market is simply not large enough for Swiss to survive alone in the long run – even if does claw its way back into the black.
Franz himself admitted that the airline was having a tough time in the face of rising fuel prices, "aggressive" competition and the ongoing political dispute over flight approaches to Zurich airport.
Globally, he said the airline sector was once again a growth industry following the post-2001 "stagnation" – but continuing over-capacity and fierce competition meant airlines were still suffering "fare erosion".
However, Franz pointed out that the carrier had substantially narrowed its operational losses from SFr703 million (including restructuring costs) in 2003 to SFr122 million (before interest and tax) last year.
He stressed that Swiss was now "generating cash on the operating level, not burning it" – operational cash flow rose by more than half a billion francs to reach SFr189 million in 2004.
As for strategic advantages, perhaps the final word should go to a UK banking analyst, who commented: "For my money, Swiss still has the best blueberry muffins in Europe – even if economy class passengers now have to pay for them."
swissinfo, Chris Lewis in Basel
Key Facts
- 2004 total income: SFr3.64 billion (2003: 4.13 billion)
- Operating loss: SFr122 million (703 million)
- Net loss: SFr 140 billion (677 million)
- Operating cash flow: SFr 189 million (– 340 million)
- Seat load factor – Europe: 60.8% (59.6%)
- SLF – InterContinental: 81.3% (78%)
- Yield (revenue per passenger-km) – Europe: down 3.2%
- Yield – IC: up 3.1%
In Brief
Swiss is refusing to confirm or deny reports of further partnership talks with Lufthansa.
CEO Franz insists that the airline must return to the black before it goes any further with possible plans for a strategic alliance.
But many analysts say such a partnership is likely – if only because it would fill the company’s "strategic gap".
Mar 12, 2005, 2:34 am
#11
Original Poster
Join Date: Dec 2001
Posts: 3,181
http://www.tdg.ch/tghome/toute_l_inf...ss__12_3_.html
Link in French. It seems it will happen between later this year and next year but Swiss has some work to do before.
Link in French. It seems it will happen between later this year and next year but Swiss has some work to do before.
Mar 12, 2005, 11:31 am
#13
Original Poster
Join Date: Dec 2001
Posts: 3,181
>>The best is, that when they join, one can use the LX miles with LH <<
True, but no longer on AA so all is relative. I think it makes sense for LX to hook up with LH. Maybe Germany will be more easy going in regards to landings in Zurich.
True, but no longer on AA so all is relative. I think it makes sense for LX to hook up with LH. Maybe Germany will be more easy going in regards to landings in Zurich.
Mar 13, 2005, 2:23 am
#14
Original Member
Join Date: May 1998
Location: CH-3823 Wengen Switzerland
Programs: miles&more, MileagePlus
Posts: 27,041
the usually very well informed (must be, my niece Andrea Martel is one of their journalists ...) Neue Zürcher Zeitung wrights today, that the deal seems to be on the finishing line. Major swiss shareholders will meet tomorrow. LH seems to be willing not to touch (much) of swiss' current longhaule network and also no more asking for an increase of swiss capital (from current shareholders) before a possible takeover.
read it all (in german) here
13. März*2005, NZZ am Sonntag
Ernsthafte Verhandlungen
Die Lufthansa sichert der Swiss den Fortbestand der Langstrecke zu. Neues Kapital müssen die Altaktionäre nicht mehr einschiessen
Lufthansa und Swiss sind nach dem Bekanntwerden ihrer Gespräche unter Druck geraten, die Verhandlungen zum Abschluss zu bringen. Am Montag findet ein Aktionärstreffen statt.
...
Ernsthafte Verhandlungen
Die Lufthansa sichert der Swiss den Fortbestand der Langstrecke zu. Neues Kapital müssen die Altaktionäre nicht mehr einschiessen
Lufthansa und Swiss sind nach dem Bekanntwerden ihrer Gespräche unter Druck geraten, die Verhandlungen zum Abschluss zu bringen. Am Montag findet ein Aktionärstreffen statt.
...
Mar 13, 2005, 6:39 am
#15
Suspended
Join Date: Jan 2005
Location: Poland
Posts: 374
LX miles on LH? - Phaaaa...
Originally Posted by bertheike
The best is, that when they join, one can use the LX miles with LH ^ .
- I.e. one is not allowed to make stop overs.
- One must use direct flights.
- One cannot use up to eight flight segments.
- Awards are hardly available (see my posting http://www.flyertalk.com/forum/showthread.php?t=410007).
- Awards are hardly available for direct flights (when I try to book WAW-ZRH I never get a direct flight with LO, they always want to give me flights vis DUS, MUC, HAM or FRA).
- One has to pay much higher airport taxes because many flights go via FRA. - One needs too many miles for European tickets (e.g. 45k for a European flight in C versus 30k with LX, 30k miles for a European Y class versus 20k with LX).
- Some destinations cannot be reached as European destinations (e.g. Canarian Islands).
- M&M ticket booking number is a 0900 number (cost: more than one CHF per minute).
- Most M&M booking numbers can only be reached during office hours (i.e. Mon-Fr 08.00-17.00).
- M&M obviously favours LH customers from Germany over others (e.g. AUA). See posting http://www.flyertalk.com/forum/showt...p?t=410143:td:
- Etc, etc.
Come on, LH is not a partner, LH is a colonial ruler, as Swissair used to be!
And last but not least: One needs much more miles in order to reach the M&M gold status! One also ought to compare the frequent flyer benefits. An M&M silver status (which needs slightly less miles than the LX gold status) is by far not the same as the respective LX status!!!To make things short: M&M is completely bad!
All I can say: BEWARE OF M&M!!! LH STAY AWAY, I DON'T WANT YOU! Our LX miles will by far not have the same value as they have in those days! Be smart and compare all the rules!!!
Last edited by ziplaufwerk; Mar 13, 2005 at 6:44 am Reason: Because the deal is a catastrophe for LX customers!