glidepath73
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LH/LX: EU Commission Gives Go Ahead

Tue Jul 05, 2005 5:09 pm

German Radio announced right now that the LH/LX deal is approved by the European commission.
But both airlines have to reduce slots in FRA and ZRH.

Is that right?
Any more news about it?

Regards,
Patrick
Aviation! That rocks...
 
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Fly-K
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RE: LH/LX: EU Commission Gives Go Ahead

Tue Jul 05, 2005 5:24 pm

Yes, it's confirmed on www.lufthansa.com too.
Once you have tasted flight, you will forever walk the earth with your eyes turned skyward, for there you have been...
 
dutchjet
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RE: LH/LX: EU Commission Gives Go Ahead

Tue Jul 05, 2005 5:30 pm

So, with this news, I guess that the LH/LX deal is a go, the US said OK over the weekend.

What is the slot issue all about - firstly, I was not aware that either FRA or ZRH had slot restrictions (or am I misunderstanding what is being said?), and, secondly, I was not under the impression that there were competition issues at these airports.
 
glidepath73
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RE: LH/LX: EU Commission Gives Go Ahead

Tue Jul 05, 2005 6:28 pm

They said in the news, if LH reduces their slots in ZRH and LX reduces their slots in FRA, that this will reduce the bigger power (monopol??) LH/LX will have together in the future in FRA/ZRH.

I think, LH/LX will just use bigger aircrafts to bring in the same amount or even more passengers to FRA/ZRH.

What's your guess?

Regards,
Patrick
Aviation! That rocks...
 
ZRH
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RE: LH/LX: EU Commission Gives Go Ahead

Tue Jul 05, 2005 6:43 pm

As I know Zurich is only slot restricted at some peak times. You are probably right that the two airlines will use larger aircrafts to the two airports.
 
gerardo
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 5:53 am

Apparently they only have to give up slots, IF a competitor wants on start on a specific route AND it don't get the slots on the bi-annual slot conference. So, I don't think, LX/LH will give up many slots.

Gerardo
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BHXFAOTIPYYC
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 6:14 am

Don't you think it should be the German / Swiss governments approving the deal rather than the unelected, underworked, overpaid group of has-beens or never-weres politicians known as the European Commission?

LX and LH offering some really good biz class long haul deals out of Europe by the way.
Breakfast in BHX, lunch in FAO, dinner in TIP, baggage in YYC.
 
TUNisia
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 6:27 am

Quoting Gerardo (Reply 5):
Apparently they only have to give up slots, IF a competitor wants on start on a specific route AND it don't get the slots on the bi-annual slot conference. So, I don't think, LX/LH will give up many slots.

When will this take place?
Someday the sun will shine down on me in some faraway place - Mahalia Jackson
 
flyAUA
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 6:39 am

Quoting Dutchjet (Reply 2):
What is the slot issue all about - firstly, I was not aware that either FRA or ZRH had slot restrictions (or am I misunderstanding what is being said?), and, secondly, I was not under the impression that there were competition issues at these airports.

Well... seeing that they will merge (or whatever you want to call it) it has to be seen as ONE entity regardless of the color of the aircraft on the outside. If they were allowed to keep all their slots, this would have competitive consequences. The regulatory body probably decided this in order to give other carriers a chance too and prevent the LH/LX merger from killing any other competition. By having a high number of movements at an airport (relative to other carriers), you are making your service more attractive because you have more frequencies (more choice on flights), and it becomes cheaper to operate because you are enjoying economies of scale (larger operations yield more money). If the EU commission would not do anything about this, then any other airlines flying from FRA or ZRH would have difficulty competing I guess.

Anyways, I guess it's good news that this happened. Hopefully LX management will see a radical change now and make the airline profitable once and for all!
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SWISSER
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 8:20 am

Quoting BHXFAOTIPYYC (Reply 6):
Don't you think it should be the German / Swiss governments approving the deal rather than the unelected, underworked, overpaid group of has-beens or never-weres politicians known as the European Commission?

I don't get it you question there desision...
(altough you are right about the underworked etc. lol!)
That commision will provide even a possibilty that more work for Portuguese
people is allowed if they plan more flights to ZRH/FRA for instance, that is the reason why you and me have that european flag on our lisence plates  Wink

Quoting FlyAUA (Reply 8):
If the EU commission would not do anything about this, then any other airlines flying from FRA or ZRH would have difficulty competing I guess.

That hits the nail on it  Wink

Anyway I don't think that massive air bridging between FRA and ZRH will be needed, if you think about it, why would you fly from FRA to ZRH to get on a flight (for instance) to JNB as LH off course already can do it from FRA?

Alough several highly aimed "ferry" flights between the 2 arprts will ne needed I think to fullfill the requirements of those destinations you can't get too from ZRH...

So the lesser slot thing is not an easy gift...(gift is in swedish now Wink)

Quoting FlyAUA (Reply 8):
Anyways, I guess it's good news that this happened. Hopefully LX management will see a radical change now and make the airline profitable once and for all!

even without LH they were well underway to become profitable  Wink
*a completely new long haul fleet turnover in only two years time is always a high cost, and I don't think many airlines could have done that in the years 2002/2003, if you look at it that way for instance!

*why would LH have ever considered a COMPLETE take-over of an airline with such negative results without figuring out why;

*LX booked the first quarter of 2005 787 (Million) CHF of revenue, compared to a better first quarter of 2004 of 819 CHF and booked a net loss of -44CHF for 2005 compared to -78CHF to 2004.

Off course not good, but with lesser income generating a better number is only possible at what LX calls restructuring costs wich off course include the brand new fleet.
Anyway they improved 59CHF compared to 2004 results with 31CHF lesser income for 2005 1st quarter.
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TUNisia
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 10:25 am

Quoting SWISSER (Reply 9):
Off course not good, but with lesser income generating a better number is only possible at what LX calls restructuring costs wich off course include the brand new fleet.
Anyway they improved 59CHF compared to 2004 results with 31CHF lesser income for 2005 1st quarter.

When will this restructuring take place exactly? What will be complete first? Routes (if so which routes) or new AC?
Someday the sun will shine down on me in some faraway place - Mahalia Jackson
 
SWISSER
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 8:34 pm

Quoting TUNisia (Reply 10):
When will this restructuring take place exactly? What will be complete first? Routes (if so which routes) or new AC?

these where restructuring costs that already started in 2002 when the new long haul fleet order was a defenitive commitment.

Aircraft already arrived (new A343's) and procedures to get rid off the MD-11's
as well as implementing new training procedures involve higher cost the first years that will reduce eventually.

Currently there are plans to "get rid" of some short haul aircrafts, that will
most likely be the Saab's and possibly some ERJ's...
so routes will possibly be stopped in fequency, but not that dramatically.
The long haul operation is profitable, short haul must achieve much better!

Restructuring also took place in manpower reduction...

The board also decided to withdrawn the Basel traffic,(wich was a very bad move in my eyes!)now with the low cost carriers trying to volture the place.
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RJ100
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RE: LH/LX: EU Commission Gives Go Ahead

Wed Jul 06, 2005 9:02 pm

Quoting SWISSER (Reply 11):
The board also decided to withdrawn the Basel traffic,(wich was a very bad move in my eyes!)now with the low cost carriers trying to volture the place.

Not only the LCCs are filling the gap, also some other airlines.
When can we expect the official decision on the withdrawal of BSL (and most likely GVA)? It would be fair enough to let the partners (airports, ground handling agents etc.), employees and CUSTOMERS know so that they can plan the future without LX.

I know several airlines who will announce BSL only days after LX withdraws the route. We only wait until they get lost.

BTW, slot restrictions will affect Zurich to/from Frankfurt, Munich, Berlin, Düsseldorf, Hamburg, Hannover, Stockholm, Copenhagen, Vienna, Warsaw, Bucarest, Helsinki, Chicago, Los Angeles, Boston, Miami, Bangkok, Johannesburg and Cairo.

I expect ZRH-LAX-ZRH to be dropped since the route has produced losses ever since they operate it.

Regards,
RJ100
none
 
SWISSER
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RE: LH/LX: EU Commission Gives Go Ahead

Fri Jul 08, 2005 8:34 am

Quoting RJ100 (Reply 12):
BTW, slot restrictions will affect Zurich to/from Frankfurt, Munich, Berlin, Düsseldorf, Hamburg, Hannover, Stockholm, Copenhagen, Vienna, Warsaw, Bucarest, Helsinki, Chicago, Los Angeles, Boston, Miami, Bangkok, Johannesburg and Cairo.

Really?
That's one piece of restriction...

BTW, thomas,
If you use a flightsim, visit www.swiss-va.com !!

[Edited 2005-07-08 01:36:48]
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RJ100
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RE: LH/LX: EU Commission Gives Go Ahead

Sat Jul 09, 2005 12:32 am

Yes, but since most of the routes are served by Star Alliance and LX they will simply reduce their "own" competition (instead of 5 flights each to XXX they will take one carrier away and use larger aircraft). And, they will only lose slots if another carrier applies for them (which is very unlikely in the case of some of the destinations.)

In my opinion it is very unlikely that LX will keep LAX, west coast operations are too expensive for SWISS. My scenario says that in the long term the LX route network will be reduced to the absolute minimum, serving destinations with a home market, that is ZRH-JFK, eventually Miami and/or Boston, one or two destinations in Asia and something in the Middle East. Everything else would be against all the economic rules. FRA and MUC will always be preferred since these airports partly belong to LH. They dont have an interest to feed passengers through ZRH.

That they will add services to GVA and BSL (apart from their very sucessful feeder services) is even more unlikely. But I think GVA and BSL airports/customers don't care about that much.

Regards,
RJ100

P.S.: Thanks for the link  Smile
none
 
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PA110
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RE: LH/LX: EU Commission Gives Go Ahead

Sat Jul 09, 2005 12:51 am

Quoting SWISSER (Reply 9):
Anyway I don't think that massive air bridging between FRA and ZRH will be needed, if you think about it, why would you fly from FRA to ZRH to get on a flight (for instance) to JNB as LH off course already can do it from FRA?

Yes, but LX operates to a few African destinations not served by LH, namely NBO DAR DLA NSI SSG

My question is - how fast does this end LX partnerships with SN and AA?
It's been swell, but the swelling has gone down.
 
SWISSER
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RE: LH/LX: EU Commission Gives Go Ahead

Sat Jul 09, 2005 9:27 am

Quoting PA110 (Reply 15):
My question is - how fast does this end LX partnerships with SN and AA?

I was wondering that too...
AA is off course a big oneworld carrier and UA only started service from ZRH.
So I expect them soon to switch carrier co-operation.

SNBA is still a "one man" carrier feeding only the interests for passengers from Belgium or passengers from europe who need to be in the Brussels region.
They code-share on AA for there traffic to the US.
Also note that Virgin Express is the same company as SNBA today!
Maybe LX will keep the code shares from GVA as both LX as SN have very good agreements on the BRU-ZRH-GVA routes...leftovers of the once SR (original)SN alliance off course!
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