from that media post by LH Newsroom it says:
(...)Lufthansa will therefore be obliged to transfer to one competitor each
at the Frankfurt and Munich airports up to 24 take-off and landing rights
(slots), i.e. three take-off and three landing rights per aircraft and day, for the stationing of up to four aircraft. For one and a half years
, this option is only available to new competitors
at the Frankfurt and Munich airports. If no new competitor makes use of this option, it will be extended to existing competitors at the respective airports.(...)The LCC options:
Considering FR, U2 are already in FRA and W6 just recently left, who is actually left on the market with great interest and the necessary amount of money to set up base with four aircraft and at a very restricted airport when it comes to nightcurfew? Vueling (VY) tried a few years ago, but gave up. Level Europe (VK) very unlikely in current market environment. Norwegian (DY) - well, they should survive first.
What about Transavia (HV)?
Situation in MUC is a bit different and more opportunities are available I guess. FR axed their routes though just recently. Other airline options:
I see hardly any other airline currently having the money for such an investment. Sure, FRA or MUC aren't LHR, but it's still very resource-intensive and particularly for the case of FRA hardly any big catchment area supporting such operations (besides businesses like banking, service, etc. of course).
Yes, they have made it very hard for the slots to be taken away.
De-facto no EU strings attached.
What LH and other airlines receiving bailouts are forgetting in this process is that they are actually destroying the EU competition office.
If anything, that office has protected their interests by culling smaller airlines, nipping start-ups in the bud, and constantly nagging at LCC's.
After this, anything coming from this office is most likely to have to go through a lengthy court process to be confirmed or denied.
As recently as February, this EU office acted evasively, repeatedly delaying and rejecting a request from the Sardinian Region to formalise new continuita territoriale subsidies.
The EU was looking at every single letter in the construction of these subsidies.
After this LH bailout was cleared within days and based on rudimental agreements on huge sums of money and very dubious constructions, you can bet that everybody is going to do what they want and refer the EU competition office to the court, using the LH bailout as a prime example of a biased two-speed EU competition policy.
Written somewhere up thread..
“”The loan will have to be paid back supposedly, there’s no such stipulation about the billions payed for a share in the company.””
And how long in reality is that going to take..?
30+ years...? If not more....???
It’s not free money.
Oh yeah, I'm sorry, I forgot about the slot and fleet requirements and the German government getting shares from which they will make serious money once the situation returns to normal.
Loans and shares are free money?
LH made the Belgian government investment company convert a 100 Million start-up loan of SN into a non-voting interest that pays dividends if the airline makes money.
The airline didn't earn money after that so that loan was never repaid and basically vanished.
If we go by that record, LH is going to try to make this bailout disappear, so they can pay out bonusses and dividends, instead of thanking and repaying the taxpayer.
That’s not a valid comparison. The numbers are wrong as LH will get way more than 6BN. And you have to either compare AF/KL with the LH-group or AF and KL with the separate airlines of LH-group. LH is still talking with the Belgian and Austrian governments and already got a huge amount of money from the Swiss government.
That's a valid point indeed!
In Belgium we're talking about 290M, in Austria it's 767M if I am correct? Switzerland already agreed to 1.1BN
Ad all that to the loan Lufthansa discussed with the WSF in Germany of the 5.7BN: a total of 7.9BN in loans.
AF + KL is at 7BN (from France) + 2BN to 4BN (from The Netherlands), all in loans.
Thus in every comparison LH gets more money while they were the airline aggressively expanding over the last decade, not AF/KL.
The conclusion that they get more money is not correct IMHO (see above)
The fact they have expanded over the last decade can not automatically be seen as something bad: I thought that was the essence of doing business successfully? Is Ryanair or Easyjet a bad business, just because they expanded agressively too?
I have the impression the EC is (mis)using the current situation to downsize a company which became just too successful, albeit by using market mechanisms only.
Your theory is rubbish and I'll explain why.
Ryanair and Lufthansa had the same amount of liquidity at the start of this crisis, about 4 Billions each.
The difference between these companies is that LH has 4 to 5 times the revenues of Ryanair: 36 Billion versus 8 Billion.
So when the revenues stop flowing in, Ryanair has 6 months of revenues worth of cash in hand, while LH has only 45 days of revenues in cash.
That's why Ryanair can survive withou a bailout and LH can't.
If LH had followed the same conservative and sound financial management that Ryanair has with their balance sheet, they would have had about 18 Billions in cash and wouldn't need to beg for a bailout.
LH has clearly overstretched its finances by overexpanding while at the same time distributing its earnings as bonusses and dividends.
The German taxpayers are now footing the bill for that overexpansion.
Remember those stress-tests on the banks in the wake of the GFC?
LH is like a bank that loaned all the savings of their customers out to maximise market share in loans. In good times, everything is fine and you can run more conservative competitors out of business, but in bad times people stop paying their loans and then you find yourself unable to give the savers their money back.
In other words, if you know that the taxpayer is going to save you at the next financial catastrophe, you can take more risk than your competitors and make more money.
This 10 Billion Euro bailout is nothing but a retroactive loan from the taxpayer to pay for LH's reckless expansion and balance sheet management.
So Blerg is right, if we follow the rules of the game, AF-KLM and Lufthansa should go cash-flow insolvent and sort it out on their own.
How would it otherwise be fair towards all the competitors that are in bankruptcy or the conservative competitors who are burning their own well-managed cash after competing against them?