Lufthansa CEO's focus is on 38 leased planes in Air Berlin battle

[FRANKFURT] Lufthansa is interested in acquiring as many as 80 planes from rival Air Berlin with its priority on securing planes it already leases, the group's chief executive said.

A creditor committee was due to meet on Thursday afternoon to discuss offers for Air Berlin, which filed for insolvency in August after major shareholder Etihad pulled the plug on funding.

Lufthansa is competing with several other airlines for parts of Air Berlin, including easyJet and Thomas Cook's Condor, with bidders especially interested in its Niki short-haul business that flies from Germany and Austria to holiday hotspots in Europe.

Lufthansa's focus is on securing the 38 crewed planes it currently leases from the insolvent carrier, plus it would like up to an additional 20 to 40 planes, Carsten Spohr said at a media event late on Wednesday.

Mr Spohr said Lufthansa expected that was the most it could take without falling foul of anti-trust concerns and if it isn't able to get all that it has bid for, it still plans to grow. "The next few days will show whether that growth comes organically via Eurowings or through an Air Berlin transaction,"he said, adding that Lufthansa would need around 3,000 new employees to meet that expansion.

The 38 crewed planes Lufthansa leases from Air Berlin currently carry passengers mainly for the group's budget unit Eurowings, and Lufthansa's priority is on keeping that operation stable.

Eurowings was hit last week, when Air Berlin pilots called in sick in unusually high numbers, forcing the cancellation of flights.

Ryanair boss Michael O'Leary has said Lufthansa would have a dominant position on domestic routes following an Air Berlin takeover. But Mr Spohr said that Lufthansa had a 34 per cent share of passengers to and from Germany, including transfer passengers, and that was what the authorities would be looking at.

Lufthansa is however not interested in Air Berlin's long-haul routes, with Mr Spohr saying the flagship carrier could grow in that area on its own.

After announcing plans to start Eurowings long-haul routes from Duesseldorf this winter, following Air Berlin's retreat there, the budget unit also intends to offer long-haul flights from Berlin Tegel airport next year, albeit starting with just one route.

Mr Spohr also said business so far in 2017 was proving significantly better than the last two years, both of which were record years in terms of financial results.

He added that Lufthansa was sticking with a goal of reducing its unit costs this year and said it hoped to sign a wide-ranging deal on pay and conditions with its pilots this month.

REUTERS