30 January 2008

Consolidation - European Style LH+TUI combine LCCs

TUI's TUIFly aka Hapag Express bright yellow taxi planes, and Lufthansa's German Wings (Yellow Tails and we don't mean fish) have agreed to merge to present a potent force to counter the growing strength of Air Berlin's conglomerate.

This is likely to see some realignment of routes and probably a cut back at CGN airport whose locals have been enjoying some really good fares lately.

It is unlikely that LH would allow the name TUI on the new venture so the likely surviving name is German Wings. Although I really thought the HEX planes were a great idea.

Net result - LH gets MUCH bigger. Don't forget they have a small stakeholding in the other guys at TC through the merging of TC's airline operations with Condor - LH's former charter susidiary. Almost overnight - OK in a year... the German market has consolidated from 4 players into 2. Once again the big yellow of LH casts a huge shadow over the whole market. Peace is restored and life goes on. Of course there will be a lot of work for those people who negotiate pilot seniority lists.

I always say Germany Inc. would never pass the USA's RICO act.



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