"Want to look a flag carrier then act like one" but no one knows how to make a profit doing that sadly. Ask Air France.
Also aren't Lufthansa on strike? It's contagious.
LH seem to manage to serve Germany pretty well, though away from FRA and MUC, mainly though a subsidiary. As for strikes, LH has been on and off strike for a year now, if it isn't the flight deck crew, then it's the cabin staff, and if it isn't them it's ground staff. They are an industrial shambles at the moment.
Goes for quite a bit of German commerce these days (e.g. Amazon, DB, the child care sector).