Lufthansa Group (LHG) has by no means been the mannequin of effectivity, which is somewhat stunning since that’s precisely what you’d count on from a Germany firm. However you must look no additional than the variety of totally different subsidiary airways — at the very least partial homeowners of Lufthansa, SWISS, Austrian, Brussels, ITA, Uncover, Eurowings, Edelweiss, Lufthansa CityLine, Lufthansa Metropolis Airways, Air Dolomiti, and SunExpress plus in all probability just a few others that have been began within the final 10 minutes — to understand that there’s work to be achieved. On the firm’s current Capital Markets Day, it promised to just do that… once more.
The greater than 100-page presentation learn like a primer on every part unsuitable with LHG and precisely how it might be fastened. Consultants clearly made good cash placing collectively a “Worth creation” plan with 4 pillars. Two of these contain Lufthansa Cargo and Lufthansa Technik, so I received’t deal with them. However on the airline facet, the aim is to go “from a gaggle of airways to ONE Airline Group.” In case you have been questioning, this shall be a “Streamlined and synergetic oprating mannequin.” Good job, consultants.
On this plan,SWISS, Austrian, Brussels and Eurowings may have an “effectivity program” whereas Lufthansa itself may have a “turnaround.” And the entire airways within the group will take part in a fleet modernization. That’s going to extend revenue by 2.5 billion euros by 2028. Positive it’s going to.
I didn’t notice Lufthansa itself was such a multitude that it wanted a turnaround, however there may be loads of information right here exhibiting an operational downside alongside different points. However general, the primary aim appears to be to remove extra of the independence every airline has and make them as related as doable with out breaking them fully. Which means issues like having a extra constant laborious product on board with the brand new Lufthansa Allegris and SWISS Senses enterprise class seats as their prime instance. Overlook that these experiences are literally very advanced with an entire variety of totally different seat sorts with various prices. A minimum of the entire fleet will finally have that very same stage of complexity.
After which there’s the fleet dialogue. On the narrowbody facet, LHG has been comparatively centered across the A320ceo and now neo households. However SWISS and ITA each fly the A220 whereas each Austrian and Air Dolomiti use the E190/195 and Lufthansa Cityline flies the CRJ-900. However these are minor fleets. Don’t fear, nonetheless. As a result of LHG has now purchased 40 B737-8 MAX plane to go to Eurowings, and it seems to be like a few of these may have really home First Class-style seating for medium-haul flying not like the full-service airways within the group which have Eurobusiness with a blocked center. That’s… a method, I suppose.
Regardless of that new complexity, it’s the widebody facet that must be consolidated much more. Right here is how issues look as we speak, in response to Airfleets.
Lufthansa Group Widebody Fleet Counts by Airline
Knowledge through Airfleets
This firm is everywhere in the map. And now, it’s going to attempt to make some progress… however not a lot, really. The B767s at Austrian shall be gone subsequent 12 months and the A340s at Lufthansa, SWISS, and Edelweiss are out in 2027. (Can we simply take a second to consider the truth that it nonetheless flies that many A340s?) Aside from that, the A330-200s will go away however the -300s will stay. The 777-200s will disappear, however there’ll nonetheless be B777-300ERs. And the B747-400s will retire, however the -8s stick round.
Of their place? Effectively, Lufthansa Group has extra B787-9s and A350-900s coming in to enrich the present fleet. ITA, nonetheless, already has an order for some A330-900neos to affix the fleet, and that’s not altering. Then LHG can even take 15 A350-1000s alongside the marginally bigger B777-9 which can be fairly related in measurement to the B747-8. After which there’s the A380. What’s going to occur to that, I do not know. Apparently LHG has no thought both. It simply has a giant query mark subsequent to the fleet sort. I’m not kidding:
This apparently counts as a fleet simplication. Solely at Lufthansa Group would that be doable.
In the long run, Lufthansa is actually attempting to make an airline group that vacationers wish to fly… specfically an airline group that old-man Jake Gyllenhaal needs to fly.
Or at the very least, it’ll be a gaggle he needs to fly in 2030 when 95 % of the fleet may have the already long-delayed new enterprise class product onboard.
This firm has all the time felt difficult to repair, and this presentation makes me really feel solely barely higher about that. There’s a lengthy strategy to go earlier than LHG can compete with the effectivity of an IAG which way back centralized core features. Even Air France-KLM is slowly catching up, but it surely simply has fewer airways manufacturers to attempt to synthesize anyway.
Within the meantime, I assume that LHG will simply proceed to push out turnaround plans concocted by consultants. It appears to be that so long as it seems to be prefer it’s doing one thing, it’s going to carry on retaining on.
