Passenger transportation is the core business of the Lufthansa Group. This business segment includes Lufthansa passenger airlines (incl. Lufthansa Regional and Lufthansa Italia), Austrian Airlines, British Midland (bmi), SWISS and Germanwings as well as the equity stakes in Brussels Airlines, JetBlue and SunExpress.
The objective in this business segment is to strengthen Lufthansa’s position as a leading European premium carrier offering services in a global network. Lufthansa serves all major traffic flows into, out of and across Europe. To realize its goal, Lufthansa rests its growth strategy on three pillars.
For one, Lufthansa is expanding its short and long-haul network in the medium term through organic growth. In the interest of cost efficiency, that expansion is achieved primarily through the hubs in Frankfurt, Munich, Zurich, Vienna and Brussels. Together, Lufthansa, SWISS, AUA, bmi und Brussels Airlines operate a wide variety of flights in serving 274 destinations in 104 countries on four continents.
For another, Lufthansa is expanding cooperation with partners. Star Alliance, above all, is playing a major role in opening up new markets. The 26 member airlines in the airline grouping currently serve a total of 1077 destinations in 175 countries. Star Alliance will further strengthen its position, worldwide, with the forthcoming admission of TAM, Aegean and Air India. Airlines in the Lufthansa airline group operate additionally with an array of services in other markets on the basis of bilateral (e.g. regional) partnerships.
Thirdly, Lufthansa actively participates in the ongoing consolidation of the airline business in Europe by acquiring stakes in Brussels Airlines, for example, or taking over other carriers – latterly Austrian Airlines – wherever that makes economic and strategic sense. The Group is accordingly evolving into a multi-hub-/multi-brand-airline system.
The Passenger Airline Group consists of the companies operating in the Lufthansa airline group, i.e. Lufthansa Passenger Airlines, SWISS, Austrian Airlines and Germanwings, together with its equity investments such as Brussels Airlines and offers its customers important benefits. The increasing harmonisation of products and processes gives passengers considerable added value by enabling seamless travelling within the Group’s route network with 246 destinations. In addition, the multi-hub strategy offers them maximum travel flexibility at the hubs of the airline group, such as Frankfurt, Munich and Zurich. For Lufthansa the strategy represents additional cost synergies as well.
With this strategy each home carrier can play to its strengths in its respective home market. At the same time, the airline group profits from the special know-how of individual members in niche markets with growth potential, such as Brussels Airlines in West Africa. The use of synergies within the Lufthansa airline group constitutes a major competitive advantage, especially in a challenging environment. Lufthansa Passenger Airlines and Germanwings are exploring new territory in combining their business models.
Lufthansa’s aim is to expand its position as leading independent group of European quality carriers and to exploit market opportunities. At the same time, topics such as safety, punctuality, reliability and professional service remain a high priority. The companies in the airline group are united in their search for profitable growth. This enables them to make investments in modern aircraft, achieve financial stability in a volatile industry and create secure jobs with attractive development prospects. The companies also strive to assume their responsibility for conserving natural resources by their sustainable business practices.
Lufthansa and the group airlines follow a diversified network strategy in all global sales markets. In Europe it is based on multiple hubs and catchment areas. Frankfurt and Munich are the largest hubs and cover the full range of products. In addition to the Group’s own expanded production platforms, the scope of cooperation agreements and alliances was also extended further in 2011. Ethiopian Airlines joined the Star Alliance in December 2011 and bolsters Lufthansa’s market position in East Africa substantially. Star Alliance remains the world’s leading global alliance, currently flying to about 1,300 destinations in 190 countries.