Air Berlin
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Air Berlin
Folks, this is _big_ ! The founder and CEO of Air Berlin, Joachim Hunold, has resigned today ! This is like Stelios leaving Easyjet, or James Dyson leaving Dyson. Looks like Air Berlin, who were never healthy, is finally feeling the market pressures badly (please use your prefered auto-translator):
Fluggesellschaft Air Berlin: Hunold geht und Mehdorn soll es richten - Wirtschaft - Tagesspiegel
Whole scene was really odd, he just interrupted one of his staff to announce this.
So, BA, get used to the idea that AB might just fold in the not very distant future. All this 10 months before they get a new airport at Berlin. What broke their neck was buying LTU and going long-haul. And recently the turmoil in northern Africa. They could survive (maybe) slimming to a more Germanwings/Easyjet-style model, or just stick to their old ways of 'flying from every village in Germany to Majorca'. Union troubles, service a just too friendly for the current market, prices sky-high, unpredictable route changes (recently the popular FRA-HAM), the big failure with the STN-hub, etc, etc. But mainly the hybris to be able to challenge DLH/4U.
Campagne at DLH offices then ! They are winning left, right and centre these days...
Fluggesellschaft Air Berlin: Hunold geht und Mehdorn soll es richten - Wirtschaft - Tagesspiegel
Whole scene was really odd, he just interrupted one of his staff to announce this.
So, BA, get used to the idea that AB might just fold in the not very distant future. All this 10 months before they get a new airport at Berlin. What broke their neck was buying LTU and going long-haul. And recently the turmoil in northern Africa. They could survive (maybe) slimming to a more Germanwings/Easyjet-style model, or just stick to their old ways of 'flying from every village in Germany to Majorca'. Union troubles, service a just too friendly for the current market, prices sky-high, unpredictable route changes (recently the popular FRA-HAM), the big failure with the STN-hub, etc, etc. But mainly the hybris to be able to challenge DLH/4U.
Campagne at DLH offices then ! They are winning left, right and centre these days...
Last edited by jpthomas72; 18th Aug 2011 at 11:09.
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You are absolutely right. Air Berlin has seemed to me to be an airline without a clear strategy. It is not a low cost airline like RYR, it is a mixed long and short haul business with the high costs that long haul brings. It has had too much service in a price sensitive market. It does not have a clear culture again like RYR; that is because it is the product of many mergers. Looks to be that a predator could be espying a nice looking target now that a potentially blocking personality is out of the way. In my view IAG is the only company that has the financial capacity to acquire and reorganise Air Berlin. There are no regulatory hurdles either. I, too, think there is a great story emerging here.
Mehdorn (ex DB) the new interim boss
If Hunold had to go as he was deemed to have lead AB in the wrong (unprofitable) direction through risky acquistions such as LTU, then his chosen interim replacement Mehdorn seems to be viewed as somewhat worse than Hunold, at least if the comments left behind the "Tagesspiegel" articel are an accurate barometer.
He seems to have done no favours for the Deutsche Bahn during his time in charge, and contributors seem almost to a man (and woman) pesimistic about AB's future is he stays in charge for any length of time.
Can't help thinking that IAG might find the chance to purchase a major German carrier at a knock down price too tempting to walk away from.
He seems to have done no favours for the Deutsche Bahn during his time in charge, and contributors seem almost to a man (and woman) pesimistic about AB's future is he stays in charge for any length of time.
Can't help thinking that IAG might find the chance to purchase a major German carrier at a knock down price too tempting to walk away from.
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I dont understand AB. Their STN network has been reducing for years and more Dash8s being used over jets. The the move to LGW, NUE and HAJ, HAJ didnt last long at all so now just 2x daily NUE. What is/was the point? Are AB planning growth at LGW or??
Air Berlin is looking less than ideal at the moment for the medium term. 3rd quarter earnings down 44% - they also borrowed EUR 100 million paying 11.5% interest each year for the privilege. As a comparison, Air France - KLM pay about 6% annual interest when they want to borrow cash.
Yes, they are taking action by pruning some routes, focussing on principal operational airports, and postponing delivery of 19 new aircraft, but it's looking a little bumpy ahead - forget about anything sexy in the next year or so.
Yes, they are taking action by pruning some routes, focussing on principal operational airports, and postponing delivery of 19 new aircraft, but it's looking a little bumpy ahead - forget about anything sexy in the next year or so.
News from a major german newspaper is that there has been a change at the top of the state investment organisation. It has been suggested this may impact negatively on further flows of cash from the middle east, which frankly are all that have kept Air Berlin going.
Easyjet of course were very interested in DBA before it was merged into Air Berlin. The reason ironically that the deal did not happen was at least partly because the DBA pilots did not like Easyjet. I suspect most would now feel differently.
Easyjet of course were very interested in DBA before it was merged into Air Berlin. The reason ironically that the deal did not happen was at least partly because the DBA pilots did not like Easyjet. I suspect most would now feel differently.
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Latest news:
Lufthansa will lease 40 aircrafts (or one third of the current fleet) from its rival Air Berlin starting next winter. This should include all flights of AB except from their main hubs in Berlin (TXL) and DUS.
LH will also cooperate with AB owner Etihad. Aircrafts should fly for Lufthansa's LCC airline Eurowings to enlarge their fleet, network and market share against rivals Ryanair, easyJet and others who might step in the German market in case AB would collapse as their quarterly reports still don't show any sign of improvement (despite ownership of EY).
With this expansion EW could be the third largest LCC in Europe after FR and EZY. Right now Vueling, Norwegian and Wizz Air are larger than EW.
Latest news:
Lufthansa fliegt bald mit Air Berlin - Wirtschaft - Süddeutsche.de
Lufthansa will lease 40 aircrafts (or one third of the current fleet) from its rival Air Berlin starting next winter. This should include all flights of AB except from their main hubs in Berlin (TXL) and DUS.
LH will also cooperate with AB owner Etihad. Aircrafts should fly for Lufthansa's LCC airline Eurowings to enlarge their fleet, network and market share against rivals Ryanair, easyJet and others who might step in the German market in case AB would collapse as their quarterly reports still don't show any sign of improvement (despite ownership of EY).
With this expansion EW could be the third largest LCC in Europe after FR and EZY. Right now Vueling, Norwegian and Wizz Air are larger than EW.
Latest news:
Lufthansa fliegt bald mit Air Berlin - Wirtschaft - Süddeutsche.de
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It must be catching
Loss-making Air Berlin earlier this week announced sweeping changes to the company, including leasing 40 planes to Lufthansa (LHAG.DE), putting its popular tourist flights to destinations such as Mallorca in a separate unit and the loss of around 1,200 administrative jobs.
"I want to reassure every customer that we continue to operate all our flights as scheduled," Chief Executive Stefan Pichler said in a statement.
http://uk.reuters.com/article/uk-air...-idUKKCN1201VW
"I want to reassure every customer that we continue to operate all our flights as scheduled," Chief Executive Stefan Pichler said in a statement.
http://uk.reuters.com/article/uk-air...-idUKKCN1201VW
I've been looking at Air Berlin, Niki and Belair and the events surrounding these airlines over the last few months. I understand that the *UAE-based-airline-that-must-not-be-named* is de-emphasising its investments in the Air Berlin group. I understand also that AB wants to focus on Berlin + Dusseldorf rather than any other German bases. Niki seems to be picking up a lot of the leisure traffic while Belair rather than being shut down today is planned to keep going for the forseeable future. I understand also that about 33 AB aircraft have been leased out to LH-owned Eurowings
Right now it all seems a little temporary without any obvious strategic destination. Does anyone understand what the Air Berlin and Lufthansa boards intend to do now, beyond just "wait and see what happens" ?
Right now it all seems a little temporary without any obvious strategic destination. Does anyone understand what the Air Berlin and Lufthansa boards intend to do now, beyond just "wait and see what happens" ?
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This is a bigger game between Lufthansa and Etihad, Air Berlin is the bargaining chip.
Article in Flight Global last week.
Lufthansa chief lists obstacles to further Air Berlin integration
17 Mar 2017 16:15 GMT+00:00
Michael Gubisch (London)
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Lufthansa Group's chief executive Carsten Spohr has indicated potential interest in a takeover of Air Berlin, but identified three main obstacles: the Oneworld carrier's debt burden, its cost base, and potential anti-trust issues at airports.
"If these three topics are resolvable, one can imagine further steps," Spohr said during a results briefing on 16 March, having been asked about the possibility of a complete takeover of Air Berlin. "Today, we still have no solution for these three topics."
Talking through the three hurdles that would need to be overcome, Spohr commented: "Air Berlin has a high debt burden which, I think, no owner, of course, would want to carry."
The airline's cost base, meanwhile, is "not competitive", he says. "Otherwise, it [Air Berlin] would not be in the situation it is in today."
He stresses that cost issues span a range of areas: "I am not necessarily talking about staff costs."
Spohr also acknowledges that anti-trust concerns would arise at "several" German airports "if Eurowings – which mostly is number one with Lufthansa already today – were to completely go together with Air Berlin".
In 2016, Lufthansa arranged with Air Berlin shareholder Etihad Airways to wet-lease 38 Air Berlin Airbus A320-family jets for five years.
Thirty-three of these aircraft were earmarked for Eurowings, to aid that carrier's expansion.
Air Berlin, meanwhile, is halving its fleet to some 75 aircraft and concentrating on scheduled operations from Dusseldorf and the German capital.
Services to Mediterranean destinations – bar Italy – are being transferred to Air Berlin's Austrian affiliate Niki, which is to form part of a new European leisure carrier being set up in partnership with Etihad and TUI.
That tour group's German-based flight operation, TUIfly, will also be part of the new leisure carrier.
Meanwhile Lufthansa and Etihad are signalling wider partnership:
Etihad's co-operation ambitions with Lufthansa, first signalled in December through a planned codeshare on a small selection of routes, was detailed at a joint press conference in Abu Dhabi at the start of February. While co-operation remains limited – the two unveiled new agreements in the fields of catering and maintenance – they have wider ambitions.
"This partnership is the platform for a much wider strategic collaboration between our two organisations," says Etihad Aviation Group chief James Hogan, adding that the tie-up is the "most significant non-equity partnership with an airline we have ever announced".
Article in Flight Global last week.
Lufthansa chief lists obstacles to further Air Berlin integration
17 Mar 2017 16:15 GMT+00:00
Michael Gubisch (London)
Add to booklet
Lufthansa Group's chief executive Carsten Spohr has indicated potential interest in a takeover of Air Berlin, but identified three main obstacles: the Oneworld carrier's debt burden, its cost base, and potential anti-trust issues at airports.
"If these three topics are resolvable, one can imagine further steps," Spohr said during a results briefing on 16 March, having been asked about the possibility of a complete takeover of Air Berlin. "Today, we still have no solution for these three topics."
Talking through the three hurdles that would need to be overcome, Spohr commented: "Air Berlin has a high debt burden which, I think, no owner, of course, would want to carry."
The airline's cost base, meanwhile, is "not competitive", he says. "Otherwise, it [Air Berlin] would not be in the situation it is in today."
He stresses that cost issues span a range of areas: "I am not necessarily talking about staff costs."
Spohr also acknowledges that anti-trust concerns would arise at "several" German airports "if Eurowings – which mostly is number one with Lufthansa already today – were to completely go together with Air Berlin".
In 2016, Lufthansa arranged with Air Berlin shareholder Etihad Airways to wet-lease 38 Air Berlin Airbus A320-family jets for five years.
Thirty-three of these aircraft were earmarked for Eurowings, to aid that carrier's expansion.
Air Berlin, meanwhile, is halving its fleet to some 75 aircraft and concentrating on scheduled operations from Dusseldorf and the German capital.
Services to Mediterranean destinations – bar Italy – are being transferred to Air Berlin's Austrian affiliate Niki, which is to form part of a new European leisure carrier being set up in partnership with Etihad and TUI.
That tour group's German-based flight operation, TUIfly, will also be part of the new leisure carrier.
Meanwhile Lufthansa and Etihad are signalling wider partnership:
Etihad's co-operation ambitions with Lufthansa, first signalled in December through a planned codeshare on a small selection of routes, was detailed at a joint press conference in Abu Dhabi at the start of February. While co-operation remains limited – the two unveiled new agreements in the fields of catering and maintenance – they have wider ambitions.
"This partnership is the platform for a much wider strategic collaboration between our two organisations," says Etihad Aviation Group chief James Hogan, adding that the tie-up is the "most significant non-equity partnership with an airline we have ever announced".
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AB will cancel/reduce with immediate effect some routes e.g. DUS-ARN, TXL-GRZ, DUS-DRS etc.
Seems like they are short of staff or they might have more seriuos problems now.
Seems like they are short of staff or they might have more seriuos problems now.
Plan to merge some of the Air Berlin group (Niki ?) with TUI seems to have collapsed. Air Berlin is seeking loan guarantees from German regional Govt bodies (Berlin and North-Rhein-Westphalia, the locations of their 2 main bases TXL and DUS)
UPDATE 1-Air Berlin asks Berlin, NRW to consider state loan guarantees | Reuters
UPDATE 1-Air Berlin asks Berlin, NRW to consider state loan guarantees | Reuters
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A lot of ad-hoc cancellations going on with unhappy/complaining customers. Right now AB is leasing aircrafts from other airlines to go on with their schedule. Personally I don't give them much time as they are not too big to fail (like AZ). As EY and LH now cooperating I think LH will take over major operation especially out of DUS with Eurowings. Berlin market is crowded with FR and EZY. So might be difficult for LH to get in this market (assuming FR + EZY will expand once AB will collapse).
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Seljuk22 - I have a DRS-DUS booked as part of a BA booking in December, and BA have yet to acknowledge that its cancelled... Who knows, but seems like there are so many changes the IT isn't keeping up!