Airline consolidation

Lufthansa circles Condor as Eurowings diversifies

Condor is attracting interest from Lufthansa.
Condor is attracting interest from Lufthansa.

Condor and Lufthansa executives are publicly speculating about a potential takeover of Thomas Cook Group’s German airline, while Eurowings will soon start selling tickets on other airlines.

Lufthansa was already widely tipped as a likely bidder for Condor as soon as Thomas Cook Group announced in February that it was reviewing the future of its airline business and might sell its carriers in Germany, the UK and Scandinavia as a whole or separately. According to experts, the German market leader, which already owned Condor until 2009, could combine the leisure airline with its budget subsidiary Eurowings to create a leisure travel-focused business with a wide range of European city and beach destinations and long-haul tourist routes.

Condor’s strong position at its home base of Frankfurt, its long-haul flights from Munich and overall route network from seven German airports make it an attractive takeover target. The airline returned to profit last year following a cost reduction programme.

Lufthansa CEO Carsten Spohr told journalists at the annual results press conference last month that with Eurowings the German group already had a ‘tool’ to expand in the growing tourism market and was now looking at how Condor might be able to support the group. However, he admitted that competition authorities would have their say in any possible Condor deal.

In response, long-serving Condor CEO Ralf Teckentrup told German media in interviews last week that he could imagine a takeover by Lufthansa. “If Lufthansa is interested, they should contact our parent company Thomas Cook, which is considering selling the group’s airlines,” he commented. “We are flying from Frankfurt with 16 planes this coming winter. That would fit for Lufthansa,” he added.

In fact, the sale process is already a step further and Lufthansa is looking at Condor’s finances, according to industry sources. But Condor declined to comment on this information.

Independent of these moves, Condor is currently focusing on operating stable flights this summer. Sales director Paul Schweiger told fvw: “Tour operators need stability. That’s what we offer, regardless of what finally comes out of Thomas Cook’s plans.” Condor will add flights from Leipzig to fill part of the gap left by the Germania insolvency,

However, Condor could face new competition from Eurowings in Frankfurt where the budget airline plans to station four long-haul planes for winter 2019/20 and fly three times a week to Las Vegas, Barbados, Mauritius and Windhoek using 310-seat A330 jets.

Meanwhile, Eurowings sales chief Oliver Wagner is already looking further ahead with ambitious plans to sell seats on other airlines and transportation partners through the airline’s website from mid-April onwards. “We will connect other airlines with Eurowings flights through virtual interlining and thus offer many transfer connections with other carriers,” he told fvw in an interview.

In parallel, Eurowings now offers tickets on German long-distance coach operator Flixbus and has signed similar sales deals with National Express, Regiojet and Eurolines.