May 30, 2018 / 12:06 PM / a year ago

Lufthansa to query German cartel office over price analysis

FILE PHOTO: Flags with the German airline Lufthansa sign flutter next to the office building in Frankfurt, Germany March 15, 2018. REUTERS/Ralph Orlowski/File Photo

FRANKFURT (Reuters) - Lufthansa (LHAG.DE) did not make any additional profit on domestic German routes after the collapse of local rival Air Berlin, and prices did not go up by as much as determined by the cartel office, an executive at the airline said on Wednesday.

The German cartel office on Tuesday said that Lufthansa tickets were on average 25 to 30 percent more expensive after the insolvency but that it would not be instigating a full investigation into market abuse.

“We did not purposefully increase ticket prices, but we did purposefully increase capacity,” Lufthansa board member Harry Hohmeister told Reuters.

He said Lufthansa’s own calculations showed ticket prices rose only 3 percent on average when adjusted for other economic effects. However, for around 5 percent of customers, tickets were 25 to 30 percent more expensive, particularly at peak times such as Monday morning or Friday afternoon, Hohmeister added.

The carrier is therefore planning to speak with the cartel office regarding its analysis and seek a correction.

Hohmeister also highlighted that the carrier incurred extra costs as it scrambled to place more seats on the market and pick up Air Berlin customers after Germany’s second largest airline ceased operations in October.

Lufthansa used a 747 jumbo jet to fly the short, but busy route between Frankfurt and Berlin and leased in up to 26 additional planes.

“That doesn’t come cheap. Overall, in terms of profit on domestic routes, the effect was zero,” Hohmeister said.

Reporting by Ilona Wissenbach; Writing by Victoria Bryan; Editing by Maria Sheahan

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