Lufthansa CEO says open to forming alliance with Gulf carriers

Wed Sep 25, 2013 3:07am EDT
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SEEHEIM, Germany (Reuters) - Lufthansa (LHAG.DE: Quote) is leaving the door ajar to forming an alliance with any of the Gulf airlines, the German carrier's chief executive said, even though currently it sees no benefit in a partnership.

Europe's biggest airline by sales has seen some of its market shares gobbled up by ambitious Gulf airlines, which have also started forming links with competitors of the German carrier after a period of standalone growth.

Qatar Airways will join the Oneworld alliance in October this year, making it the first major Gulf airline to enter such a cooperation, while Etihad Airways is expanding its global reach through minority stake investments.

"We have investigated this question several times ... The Lufthansa group, we have done our own homework and we developed business plans, potential forms of joint ventures, etcetera, with the different Gulf carriers," CEO Christoph Franz said on Monday in remarks embargoed for release on Wednesday.

"So far we've come to the conclusion that it is not beneficial for us. But in our industry never say never. So if things and the environment are changing, maybe we come to new solutions," Franz told reporters.

He said that for the time being Lufthansa had concluded that "serving the markets on our own" was the best way forward.

Lufthansa has two joint ventures, one covering the North American route with United Airlines UALCO.UL and Air Canada ACb.TO, and another on the Europe-Japan stretch with All Nippon Airways. It is in talks to enhance its collaboration with Air China.

Asked whether Lufthansa and Emirates have been in talks on a possible alliance, Lufthansa Vice President for Alliances Nils Ecke declined comment on Tuesday but noted that both sides had not found a convincing business case. His comments were also embargoed for release on Wednesday.

"There is an interest on both sides," Ecke said.   Continued...

The logo of German air carrier Lufthansa is pictured at Fraport airport in Frankfurt May 6, 2013. REUTERS/Lisi Niesner