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Lufthansa Realigns RJ Fleet

Wed Dec 22, 2004 9:46 am

Lufthansa plans to significantly cut the size of its regional fleet and is preparing to introduce larger regional jets.

The changes were enabled by discussions with the carrier's pilots union, Vereinigung Cockpit (VC), over an amendment to the current scope clause agreement.

As part of its profitability enhancement program, Lufthansa will cut 13 regional aircraft by the end of 2005 and redistribute the remainder of the fleet among the members of the Lufthansa Regional system, German industry sources told The DAILY. Eurowings will phase out all of its 15 ATR-72s and focus on a two-type RJ fleet. Of the ATRs, six will be moved to fellow Lufthansa affiliate Contact Air, while nine are expected to be up for sale. In return, Eurowings will take over five CRJ-200 from Lufthansa's Italian subsidiary, Air Dolomiti, and six BAe-146s.

When all the changes are made, the airline will operate 14 BAe-146s and 17 CRJ-200s. Lufthansa CityLine, the group's fully owned regional subsidiary, will reduce its fleet by eight CRJ-100/200s. It currently operates 63 CRJ-100/200/700s and 18 Avro RJ85s.

As part of a recent deal with mainline pilots, Lufthansa and VC agreed to negotiate a new scope clause that would allow for the use of Embraer 170s and 190s at CityLine.

Currently, the carrier can fly only 18 aircraft with more than 70 seats. According to industry sources, both sides agree that the limit is no longer sensible, given changed market conditions. Lufthansa and VC want to reach a new deal in the first half of 2005 and agreed that either side can opt out of the existing agreement if no new clause can be reached by then.

CityLine's pilots and cabin attendants earlier this year accepted that wages would not be increased over the next 30 months and also agreed to productivity improvements. The deal would lead to EUR40 million (US$53.6 million) in savings by 2006, Lufthansa said at the time.

The airline was the launch customer for the now defunct Fairchild Dornier 728 program but canceled its contract following the manufacturer's bankruptcy filing in early 2002. Since then, the planned renewal of the regional fleet has been postponed several times, as the airline extended existing leases where needed and is now cutting the size of the fleet. Nevertheless, a new pilot deal would likely pave the way for a large Embraer 170/190 order.

Lufthansa Regional is made up of CityLine, Eurowings, Augsburg Airways and Contact Air. Cirrus Airlines recently bought Augsburg, a Dash 8 operator. Air Dolomiti is understood to be looking at introducing up to five Boeing 737s to take advantage of Alitalia's weakened state and grow the group's market share in Italy.

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