Looks like the low cost carriers are having the same effect on the german tour market that they had in the UK.
Condor mulls new aircraft as it downsizes current fleet
Dateline: Friday September 12, 2003
Condor Flugdienst GmbH, battling a sharp downturn in the package-tour business along with the rest of parent Thomas Cook AG, is downsizing its fleet.
Phased shrinkage of Condor will reduce the current operational fleet by six to 34 by summer 2004: 13 757-300s, nine 767-300s and 12 A320s flown by subsidiary Condor Berlin. Some of the company's 47 aircraft already have been mothballed, leased out or are up for sale, leaving 40 in operation as of last May.
Plainly put, Condor has too much capacity for a vastly changed market, officials declare. Demand for package tours has dropped to the 1998 level while overall charter capacity of German carriers has increased 23% since then.
A total of 356 staff positions will be affected, only 240 of which involve full-time employees, most of whom will be able to transfer elsewhere within Thomas Cook's 50% owner Lufthansa Group. German retail giant KarstadtQuelle holds the other half of the eur8 billion ($9 billion) travel conglomerate, while Thomas Cook in turn owns 90% of Condor with LH having 10%.
Simultaneously with the downsizing, Condor is pursuing plans to restructure with an order next year for 22 aircraft and increasing its focus on seat-only sales to compete with no-frills carriers. It is talking to both Airbus and Boeing about a possible order. "We could be an early customer for the 7E7 but we are also looking at 737s and 767s, as well as A320s/A321s and A330s," Executive VP-Thomas Cook Airline Operations Rudolf Tewes told ATWOnline in Frankfurt. "There is no haste, but we see a decision in 2004."
Advanced discussions are underway with one of several interested buyers in connection with the ultimate disposal of all of Condor's 13 757-200s. The carrier also intends to unload its 13 757-300s eventually, Tewes said.
Included in the restructuring are plans Thomas Cook is working on, to be announced this fall, that will centralize activities of the group's five leisure-market airlines along the lines of a single pan-European entity to capitalize on cost savings and synergies. Intense restructuring efforts are geared to save the conglomerate eur600 million over two years.
In addition to Condor, the group includes Thomas Cook Airlines UK with 24 aircraft, Thomas Cook Airlines Belgium with six and SunExpress, which operates eight planes to Turkey. Combined they fly from 47 departure points in eight countries to 80 airports in 25 countries.--LH