Air Berlin

[jpthomas72]

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 (http://www.tagesspiegel.de/wirtschaft/hunold-geht-und-mehdorn-soll-es-richten/4510212.html)

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...

[colegate]

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.

[JSCL]

In slight agreement, seemed to lack direction as an airline. Problem is, this drags down airlines like Niki etc which it needs to sell it's holdings off now.

[ATNotts]

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.

[thebeehive]

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??

[pabely]

So will IAG invest in AB with the new Berlin airport coming soon????

[jabird]

Pabely - the BER thread is here (http://www.pprune.org/airlines-airports-routes/461877-berlin-brandt-ber.html)

[davidjohnson6]

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.

[davidjohnson6]

Rumours in the press about Air Berlin seeking investment from Easyjet

[easyflyer83]

Stelios hasn't been at easyJet for years.

[lederhosen]

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.

[Seljuk22]

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 (http://www.sueddeutsche.de/wirtschaft/luftfahrt-lufthansa-fliegt-bald-mit-air-berlin-1.3154894)

[blackbeard1]

Loss-making Air Berlin earlier this week announced sweeping changes to the company, including leasing 40 planes to Lufthansa (LHAG.DE (http://uk.reuters.com/business/quotes/overview?symbol=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-berlin-restructuring-idUKKCN1201VW

[davidjohnson6]

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" ?

[Flitefone]

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)
Print
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".

[Seljuk22]

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.

[davidjohnson6]

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 (http://www.reuters.com/article/air-berlin-guarantees-state-idUSL8N1J54EI)

[Seljuk22]

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).

[toledoashley]

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!

[Seljuk22]

There is just EW nonstop on DUS-DRS. Otherwise they re-book you on LH via FRA or MUC.

[Hotel Tango]

Dear Mr X

We promise – airberlin and NIKI are back at cruising altitude.

Following extensive reports regarding airberlin and NIKI in recent days, we would like to update you on our current status. The airberlin management team has recognised the issues with its conversion to a network carrier and taken countermeasures to stabilise its flight operations:

1. On 1st June, the airberlin schedule was realigned, especially at Tegel.

2. Luftfahrtgesellschaft Walter, who operate European routes for airberlin with their fleet of Q400 aircraft, was responsible for many of the delays and cancellations during April and May. We have insisted on a change of management and improved staffing levels by hiring 50 new employees.

3. Since January 2017, airberlin has appointed around 700 flight attendants in order to strengthen its cabin staff.

4. airberlin has launched a volunteer programme. Around 150 administrative staff are currently supporting their operational colleagues.

5. airberlin continues to ensure that the ground handling service provider, AeroGround, improves its performance. Visible progress has already been made since it commenced operations on 26th March, particularly with regards to staff shortages.

Both the punctuality and reliability of airberlin flight operations have already seen significant improvement and are now back to the level that we have been reliably providing for 38 years.

All bookings are secure. You can therefore confidently book your next flight with airberlin and NIKI.

Due to the current high volume of calls received by our customer services, however, we hope you will understand that it may take a little longer to process your enquiry over the coming weeks. airberlin has doubled the size of its team and is intensively working to clear the backlog.

Are you wondering how this poor performance could arise?
With the change-over to the summer schedule at the end of March, airberlin underwent the most far-reaching restructure in its history. airberlin will emerge from this as a strong network airline with 75 aircraft, two long-haul hubs in Berlin and Dusseldorf and a focus on German and European city airports. As stated above, unfortunately airberlin's restructuring process is not proceeding as smoothly as we would have hoped and as you would rightly expect.

Holiday destinations have been transferred from airberlin to its subsidiary, NIKI. The breakdown of talks between TUI and Etihad regarding the formation of a new joint venture has changed nothing. This merely concerns a change to the corporate structure and therefore has no impact on the flight operations of the airberlin group. The NIKI winter schedule has already been released and NIKI will continue to offer a reliable service to warm weather destinations.

Finally, we would like to emphasise that nothing has changed for you as a topbonus member with regard to collecting and redeeming miles, as well as your status benefits with airberlin and NIKI. We look forward to welcoming you back onboard soon!

[davidjohnson6]

Air Berlin will not apply to the NRW and Berlin regional Govts for guarantees of their debt after all

https://www.ch-aviation.com/portal/news/57010-air-berlin-wont-apply-for-government-guarantee

Not sure I quite believe the line being given out by Air Berlin, but I doubt the complete story behind this will ever be publicised

[HH6702]

Does this mean it's nearly all over for air Berlin ?

[ATNotts]

I think if they'd gone to the state governments in NRW and Brandenburg and been refused that would have been the end as creditors would have panicked.

If they have, as they suggest renegotiated leases etc., they have bought some time, but I reckon the smart money is on LH taking over some or all of AB at some stage, but if they do, the EU competition authorities really need to step in to force LH to sell of other assets, slots and the like to ensure a "German Aeroflot" isn't being created.

[alserire]

Brother and family in LA. Were due to fly from ARN to DUS and on to LAX with Air Berlin. ARN-DUS cancelled as a route so they got direct from ARN to LAX on SAS.

They are still due to come back on Air Berlin from LAX via DUS to ARN but I can't see how as the flights to ARN are gone. They haven't been offered a change as of yet

They are due to fly home on July 6th. Anyone in the know care to speculate on how likely Air Berlin are to be still operating by then? :)

[davidjohnson6]

European airlines that go bust tend to do it at the beginning of the autumn, after the holiday peak - it ensures that the maximum amount of cash is held within the company for distribution to creditors. Of course this assumes that an airline is making an operating profit during July/August

[ATNotts]

Look as though Lufthansa are luke warm at best as regards taking over AB.

Link below in German

Lufthansa-Chef zu Air Berlin: "Übernahme sehe ich aktuell nicht" | tagesschau.de (http://www.tagesschau.de/wirtschaft/lufthansa-spohr-105.html)

[Hotel Tango]

I can't see why LH would want to buy AB, with the exception of slots maybe. They already have EW. Wouldn't it be simpler to let AB disappear and then let EW expand?

[davidjohnson6]

Tango - an uncontrolled bankruptcy would possibly lead to a gap in the market on a number of routes which Easyjet and Ryanair would likely be only too happy to fill quickly.

It is in Lufthansa's interest to increase the ability to fly more short haul out of Austrian and German airports (hire staff and acquire aircraft), let Eurowings take routes over from leased Air Berlin aircraft, and then slowly let Air Berlin die quietly in a corner. You end up with Air Berlin suffering death by a thousand cuts, Lufthansa group has taken over much of the potentially profitable bits of business of Air Berlin without the debt, and because there was no takeover it becomes harder for competition authorities to make any claims of monopoly. Problem is Eurowings / Lufthansa needs more time to achieve this aim - hence why the large number of short term leases are in place. Right now mummy Lufthansa is one of the main life support systems for Air Berlin and there is very little Air Berlin can do to wean themselves off this dependency as the equivalent of drug rehab implies bankruptcy.

Me ? A cynic ? How could you think such a thing !

[davidjohnson6]

Air Berlin seems to have given up on any hope of a workable hub in Berlin (*cough* Brandenburg *cough*) for pax transferring between flights
Long haul routes are to be transferred to Dusseldorf

[Seljuk22]

JFK and AUH should remain, ORD and MIA might be cancelled soon from TXL. LAX and SFO will definately cancelled.
A few planes will end up at DUS, but not all. Some might end up at Eurowings operating out of Munich next summer as Condor will cease their leisure long-haul routes out of MUC and EW plans to enter. Also SN and EW will tighten their coperation so LH will have a strong domestic market position.

[ATNotts]

If it's all going to work as you describe it begs the question, despite how open the German industry appears on the face of it just how much meddling is there behind the scenes at federal and state government level?

I'm thinking that AB transfers longhaul aircraft to Eurowings at MUC, and as Condor exits long haul at MUC, EW enters seamlessly. is the German government's goal to kill of competition in the scheduled sector. Appears a bit too choreographed for my liking.

[lederhosen]

There will eventually come a point that the money runs out. The middle eastern backers appear to have burned through billions. TUI and Lufthansa have both taken a step back from their previously suggested plans. Surely a controlled winding up at the end of the summer season with bits being taken over at fire sale prices must be an increasingly likely scenario. If the same happens at Alitalia then it will be interesting times.

[alserire]

Brother and family in LA. Were due to fly from ARN to DUS and on to LAX with Air Berlin. ARN-DUS cancelled as a route so they got direct from ARN to LAX on SAS.

They are still due to come back on Air Berlin from LAX via DUS to ARN but I can't see how as the flights to ARN are gone. They haven't been offered a change as of yet

They are due to fly home on July 6th. Anyone in the know care to speculate on how likely Air Berlin are to be still operating by then? :)

Flight to LAX cancelled with less than 24 hours notice. A big deal when they cancel your flight from L.A. in the middle of the night and don't even email you to tell you or offer an alternative.

I wouldn't book anything urgent or long haul with them.

[lederhosen]

The german pilot boards are full of very troubling stuff about delays and cancellations. Handling in Berlin remains a major problem area. The lack of reliability makes booking them pretty unattractive for a lot of people. The only bit that seems to have a clear future is the wet lease operation for Eurowings, with its own AoC. What happens to the rest is anyone's guess.

[Hotel Tango]

Well, just of late Eurowings/Germanwings have had their fair share of delays too. Since May this year all my flights bar one have been delayed 30 minutes or more. And waiting in the lounge looking at the departure screens I could see it wasn't just my flights that were affected.

[alserire]

Flight to LAX cancelled with less than 24 hours notice. A big deal when they cancel your flight from L.A. in the middle of the night and don't even email you to tell you or offer an alternative.

I wouldn't book anything urgent or long haul with them.

Less than twelve hours before departure my brother had to ring them, while in L.A., to find out what they were doing for him. They eventually rerouted him home to ARN but at the point that he rang there had been no communication from them whatsoever. He was all but going to show up at the airport with his family with no idea what was going to happen.

Avoid transatlantic with these charlatans. It's almost certainly over for them based on this experience.

[Seljuk22]

New long-haul flights out of DUS announced for summer 2018

DUS-YYZ 4 weekly
DUS-ORD 5 weekly

airberlin provides connections between Dusseldorf and New York (JFK) twice a day. airberlin operates daily flights from Dusseldorf to each of the following destinations: Boston, Los Angeles, Orlando, Miami and San Francisco. airberlin has increased the number of flights to Orlando with two additional flights compared to last year. airberlin is the only to fly from Europe direct to Fort Myers, which it does three times a week. During the summer of 2018, airberlin will also fly to Cancun, Mexico and to Varadero, Cuba twice a week. Furthermore, there will be flights from Dusseldorf to Punta Cana in the Dominican Republic three times a week.


From Berlin just JFK (daily) and AUH (double daily) will remain.
airberlin press ? airberlin continues growth and introduces flights to Canada (http://ir.airberlin.com/en/press/pressreleases/2017/07/28_airberlin-continues-growth-and-introduces-flights-to-Canada)

[Seljuk22]

AB files for insolvencyand LH might take over
https://flights.airberlin.com/de-DE/airberlin#EN
https://newsroom.lufthansagroup.com/en/news-and-releases/2017/q3/512.html

If happens LH Group will be massive in Germany, Switzerland and Austria.

[inOban]

Would Lufthansa be allowed to take them over?

[cornishsimon]

What's the ownership of the AB aircraft? Leased ? Any owned ?

[Seljuk22]

After 39 years of operation without any loss of life or an aircraft Air Berlin will operate today its last flights. Tschüss & bye-bye!

[zed3]

Sad... flew with them as LTU and Air Berlin, Tristar, MD11, A330, always good friendly service both pointy end and cabin. Their First Comfort (Business) Class was great value for money. Many great flights from my 'continental years'.

[Captain_Caveman]

Confirmed this evening to all EZYstaff, agreement to buy up to 25 Air Berlin aircraft. Reduced timetable to operate over winter 17/18 with full timetable up and running by start of summer 18 season.

[ATNotts]

After 39 years of operation without any loss of life or an aircraft Air Berlin will operate today its last flights. Tschüss & bye-bye!

Yesterday evening I chanced upon a 90 minute TV special on german regional channel RBB on the arrival of the final flight from MUC, AB6210 if I recall correctly, which actually landed one hour late, and subsequent programmes delays as a result. The arrival included a water arc from the fire service as the aircraft arrived on stand. Really quite touching. If may be available, if anyone is interested at rbb Mediathek: Der letzte Flug von Air Berlin | rbb Fernsehen (http://mediathek.rbb-online.de/tv/Abendschau/Der-letzte-Flug-von-Air-Berlin/rbb-Fernsehen/Video?bcastId=3822076&documentId=47232208)

There does appear to have been a really close affinity between Berliners and the airline, due to their role in shipping package holiday passenger from West Berlin back in the dark days of partition.

[canberra97]

Thanks for posting the link it was sad listening to the captain talking to the reporter at Tegal and the local TV station gave a fitting tschus to Air Berlin.

On YouTube there are some good videos uploaded of the final flights well worth watching and quite emotional

At least everyone involved had a dignified ending unlike the employees of Monarch.

[ATNotts]

You're welcome, wouldn't have know it was on RBB but for that I was idly channel hoping on my other satellite box finishing a drink before retiring to bed!

Agree with your comment about Monarch; although the German authorities are, probably rightly so, being slammed for the way in which they handled the sale of the business in such a way that LH benefited by getting what was in reality "first dibs" I do think the orderly shutdown of AB reflects well when set against the undignified end of Monarch, complete with the CAA's repatriation airline. It surely need not have ended like that, capitalism doesn't have to be that cruel as the Germans have demonstrated, and not just with the AB failure.

I did numerous trips STN/NUE with AB back in the early 2000s, their fares were very competitive, and their service top notch - which was probbaly part of their problem. Cheep fares generally equate is piss poor service, I suppose a bit the same as Monarch's issues.

[whitelighter]

Saw a A319 taxying out at BCN at about 18.30 yesterday (27th). That must have been one of the last flights.

[gnarlberg]

some airberlin aircraft still fly the wet lease for Eurowings. They can't use the Airberlin registrated 33 A320/319 in Eurowings livery since they are bought from lufthansa and leased back. If they are used after the last flight 27.10 with airberlin staff on it it would induce the german "Betriebsübergang" which would in fact mean that Carsten Spohr has to continue running the airberlin Staff with their old contracts.

[davidjohnson6]

The EU has said no to Lufthansa buying Niki due to monopoly concerns on travel to/from airports in German speaking areas. Lufthansa will no longer fund niki and niki are now considering an application for bankruptcy / insolvency to the courts

[daz211]

Niki will cease flight operation on December 14 2017

[LBIA]

Looks like Niki Lauda is interested in buying back the airline, but has said it would need a fresh start on the basis of insolvency proceeding.

[Plane.Silly]

If Niki did go under, wouldn't that mean administrators would end up begging LH to take over anyway, and likely for a lower price?

[STN Ramp Rat]

no LH could not buy it because the EU would not let them. someone might buy it but for an existing airline it might be cheaper and less complex to occupy the space through expansion. that's what I suspect will happen in the UK and Germany next summer.

[pabely]

no LH could not buy it because the EU would not let them. someone might buy it but for an existing airline it might be cheaper and less complex to occupy the space through expansion. that's what I suspect will happen in the UK and Germany next summer.

EZY could have saved setting up their own AOC in hindsight and with Niki's links to TUI, I'm sure the new EZY CEO will know who to speak to!

[southside bobby]

Austrian Government now considering "bridging loan" for Niki.