Air Berlin : fleet cut in half + layoffs
According a (serious) German newspaper this morning Air Berlin ( 2nd Airline in Germany) , lost 1 billion $ last year is planning to cut its fleet by half, including pilots and cabin crew layoffs .
Sad day for Germany. Air Berlin soll halbiert werden - Wirtschaft - Süddeutsche.de |
no - a sad day for Air Berlin staff and their investors
In the 21st century we should stop confusing an airline's interests with a country 's interests there is still plenty (maybe too much) capacity to serve Germany |
The plan seems to put some aircraft into a joint venture with Tuifly.
Eurowings wants to wetlease 40 other A/C. So nearly all A/C will be operated. |
Harry :
we should stop confusing an airline's interests with a country 's interests LW20 : wetlease ? The article ( and some others) do not mention it. As the merging with Tui , the article says it will be the 17 FlyNikki aircraft ( from Austria) that may join the Tuifly fleet, not AB aircraft. |
AB's seat costs are approximately 3x those of Ryanair. With the latter making more and more inroads onto markets from primary airports across Germany there is only so far brand loyalty will take you!
|
AB will operate 40 A320 on wetlease for EW. LH kills two birds there, one the slots stay blocked so EZY/RYR cannot get in plus they expand without having to hire crew nor aquire A320 :) EW will probably fly the same AB routes for a period to keep regulators happy.
|
Consistently the worst customer service I have ever experienced from an airline, to the point of fury on several occasions.
Although sad for individuals, as a corporate entity they absolutely 100% deserve this. |
Consolidation is inevitable in Germany. I think in 10 years time you will see LH subsidiaries limited to prime slot-constrained markets such as MUC/FRA/DUS and EasyJet, Ryanair and Wizz scrapping for everything else.
|
Probably, and that will signal the end of my flying days, at least within Europe. With no Channel to cross, it will be back to the car and holidays in France. Being retired I can travel there off peak.
|
I think the general feeling is it had to happen. Some strange Union agrreements in place due to previous mergers. The best thing AB could do is cease and start again. That's not my view but someone who works there!
|
Air Berlin had a nice business case with their flights to holiday destinations, one aircraft type, a lot of small bases all over Germany. But then Hunold got megalomania. Bought Deutsche BA and LTU. By this he made it to complex and the operating costs got to high.
|
Anyone who didn't see it coming though? The only reason it took as long was because Etihad threw money at them over and over again.
|
Yes, but I'm slightly surprised EY didn't throw money at them with stricter conditions and that we would've seen AB doing a proper turnaround in their business....
CP |
Yes, but I'm slightly surprised EY didn't throw money at them with stricter conditions and that we would've seen AB doing a proper turnaround in their business.... Besides, AB is a complete basketcase and EY are hardly the world-standard, as far as demonstrated ability to perform turnarounds goes. They've got lots of money, but not necessarily the talent to manage it wisely. One hopes the soon to be ex-employees of AB may find gainful employment elsewhere, in the industry or outside of it. Don't be surprised to see parts of its management washing up on hot and sandy shores, as thousands of failed managers have done before them. |
There is a certain panic in Germany that now with the Brexit on the horizon lowcost giants from the UK might step expand in central Europe instead. So everybody tries to brace for that moment, LH, AB and TUI. Ryanair has quietly moved many flights and business to Germany's big airports and aims for business travellers now, being ready to grow there.
|
http://mobile.reuters.com/article/idUSL8N1C22FG
"mainly sales and marketing jobs" (to go) - if you don't sell the flights yourself you won't need them, true. |
There is a certain panic in Germany that now with the Brexit on the horizon lowcost giants from the UK might step expand in central Europe instead. So everybody tries to brace for that moment, LH, AB and TUI. Ryanair has quietly moved many flights and business to Germany's big airports and aims for business travellers now, being ready to grow there. |
This requires the German government to grow balls. You know who our "chancellor" is ? She won´t grow the required 'tools' to cope with that guy O'Leary.
In fact, German policy since Gerhard Schroeders so called "reforming" (the "Agenda 2010"), was to shrink German employees rights to next to zero, dumping the income and create a whole new part of the populous, the working poor. Social welfare is now for people from the middle east and German workers that get the sack at, say age 50 or 55, are doomed. They will, after one year, go to "HartzIV" which means to get stripped of everything of value before the welfare kicks in. Meaning sell your life insurance, use whatever savings for your pension age you have, sell your house, should it be greater than 160 square meters etcetc. And Angela Merkel keeps this course true and well. |
|
Can anyone say whether Air Berlin is a low cost carrier?
This question has nothing to do with their fares. If their fares are low and their costs are high they're doomed. "Concentrate on higher yielding markets" and they're probably doomed. Simple. |
Can anyone say whether Air Berlin is a low cost carrier? but their IT intra European flights are very basic low cost service. |
Really? We're blaming Brexit for this? I'd say the lack of direction and focus, complex fleet structures, trying to everything: a network carrier, a full service airline, short haul, long haul, regional, low cost. It had a ghastly cost base and was rapidly coming irrelevant. For many years it has been problematic. Brexit has been a recent phenomena - nobody expected it to happen so until the referendum dare had zero impact. Now that it's happened it will have the most minuscule impact on Air Berlin that it's not worth even mentioning.
I missed my bus this morning. Damned Brexit! |
Does anyone have any ideas about the regulatory aspects of this? To the casual observer it seems there might be issues at several levels. A de facto takeover of Air Berlin flights and slots at all german airports outside of Berlin and Dusseldorf surely raises some question about monopoly and competition. Various media reports in Germany suggest fares will increase as a result, which certainly points in this direction. The remaining airline is all the more aligned with a non european part owner, which leads back to problems with whether it is actually controlled from outside the EU. Last but not least given the well reported CAA scrutiny of Monarch finances and alleged ultimatums, does Air Berlin's more than difficult financial situation lead to the authorities taking similar action? On a positive note the much overdue decisive changes (if they are allowed) give at least some hope for the remaining employees...interesting times indeed!
|
Germany is currently investigating for fraud regarding RyanAir pilots. But at the end Ryanair pilots will have to decide whether they want to change their system. If they chose to pay fines rather than indicting Ryanair for setting up this system, they (and all of us) will have to endure the effects.
As for AB, hopefully most pilot jobs will be saved, although it seems strange for LH to wet lease from AB, thus "feeding" AB as a company. Maybe have something to do with market dominance. What will happen in six years when the wet lease runs out? |
Until we know exactly what Air Berlin and Lufthansa/Eurowings intend to do it is difficult to assess but I would expect the key criteria to be
1) If the slots have been allocated to Air Berlin and are leased to Eurowings along with the aircraft then it could be seen as a marketing agreement along the lines of "Eurowings by Air Berlin" rather like Hop took on a number of local French carriers operations. 2) If however, the slots are definitively transfered to Eurowings by some deal and are at slot restricted times and when Eurowings already has a near-dominant position on arrivals and departures at such times then Lufthansa could be requested to release some slots at such times to allow another airline to compete on critical routes. Note that domination at an airport is not the most critical factor but rather specific routes from the airport. However, even then, if you look at the French market, despite the attempts of Air France to contain Easyjet operations, they are now all over France and apparently quite successful, so it is debateable whether not having say peak-hour slots actually prevents an LCC from providing an adequate low price offer (not having any at all is different), As far as I am aware, the authorities are not obliged to look at the longer term (e.g. is this just an marketing agreement and not a direct transfer of Air Berlin operations to Eurowings) if that is not stated, and some words used could suggest that it is just that. I suggest the test is whether the Air Berlin brand will completely disappear on the operations of the 40 wet-lease aircraft. |
According to this (In german only, sorry):
aero.de - Luftfahrt-Nachrichten und -Community AB won´t give away their slots. Up to 40 a/c to DLH or rather Eurowings up to 35 to TUIFLY. |
With 40 to EWG and 35 to TUI, that leaves them with very few. You have to also take into account that some of the present BER fleet comprises of a/c leased from other companies, such as TUI for instance.
|
Current plan is to operate 38 aircraft for Eurowings/Austrian as wet least, plus two dry leases. Another 75 aircraft will be operated by the new airberlin, with further growth on the longhaul sector (8 additional A330 in the next two years). Niki and Belair will be sold off into a joint venture with TUI and/or Condor. Which leaves airberlin actually with a larger fleet than before and they have to hire both cabin and flight deck crew. Around 1200 employees on the ground have to leave the company though. Roughly half in administration and maintenance.
|
What will happen to their hub in PMI?
|
I am glad it all sounds so positive for the crew Denti. You here all this stuff about bad banks etc. and given the less than stellar financial performance over the last few years you wonder how it is all going to work out. If Pichler can pull it off it will be a fantastic job given the hole his predecessors dug, the next few weeks will no doubt be critical.
|
Originally Posted by RAT 5
(Post 9524850)
What will happen to their hub in PMI?
This pMI business used to be AB's cash cow. They completely lost it to LoCos as there was no differentiation. |
Well, there seems to be a bad bank in the works. Put the unwanted subsidiary companies Belair, Niki and the unwanted 14 wet leased planes from TUI into a different company, let it fly for a summer and then go bankrupt, if you can transfer some of your debt into that, even better.
|
There is a certain panic in Germany that now with the Brexit on the horizon lowcost giants from the UK might step expand in central Europe instead. So everybody tries to brace for that moment, LH, AB and TUI. Ryanair has quietly moved many flights and business to Germany's big airports and aims for business travellers now, being ready to grow there. Easyjet ? Think MO'L's comment on being called British will only get one response ":mad::mad:" |
The Handelsblatt article this morning was not very positive. This was not apparently Pichler's idea, but very much guided from elsewhere according to their sources. They also quoted the boss of Eurowings as saying the deal was not yet signed for the wet lease. There was some scepticism too about yields across the atlantic where Air Berlin is supposed to earn the money back. The only real plus is Lufthansa's very real interest in keeping Ryanair and Easyjet out as far as possible. But if the regulator were to insist on slot transfers?
|
The AB CEO yesterday told the staff repeatedly that the deal was signed on wednestay night at 21:33. So i guess it is signed, however, with Lufthansa, not Eurowings. And of course pending approval of the boards and relevant authorities. It is a marginal deal in my opinion, 1.2 billion € over six years for 37 to 38 wet leases and 2 or 3 dry leases is not a real good deal at all.
The slot situation will be interesting, as airberlin is apparently only transferring aircraft (and crew) to Lufthansa, but not slots, they will remain with airberlin. |
They signed a LOI, not a contract, Denti. The regulator however is not a factor, as no slots are to be transferred. All remain with Air Berlin.
One of the most critical points will be how the TUI situation is dealt with. They remained rather vague on this one, and it is one of the biggest problems of AB currently. |
Interesting, as he specifically said "vertrag", or contract. But then, it wouldn't be the first time he lied his employees straight into their face.
|
And I'll say it again....For the umpteenth time....
Just how big does LH Group have to be before someone in Brussels begins to notice the near-monopoly they have on flights in and between Germany, Switzerland, Austria and Belgium. It isn't even funny anymore that Brussels lets them get away with it. |
Aviation is always a bit of a special case. But if a concrete manufacturer agreed to produce for a competitor and the product was all then sold by the competitor then the competition authorities would certainly take a look. In practical terms whoever the slots belong to and are operated by, the result of the wetlease will be a reduction in competition.
|
Members of the oneworld® global aviation alliance®
Air Berlin S7 (Sibir) airlines Suprised? :rolleyes: Both of them synonymous with unreliability, poor service and destruction of their brand loyalty. (customer base). B A is part of the same alliance, but from what I saw, embarrassed to be connected with such outfits. |
All times are GMT. The time now is 02:12. |
Copyright © 2024 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.