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Lufthansa Buys Stake in Jetblue, Gains US LCC Partner December 16, 2007

Posted by Andrew in Airbus, Boeing, Jetblue, Lufthansa.
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Germany flag carrier Lufthansa Airlines agreed on Friday to buy a nineteen-percent share in US based low-cost carrier Jetblue Airways. According to the Associated Press,  “the deal provides for an ‘operation cooperation,’ but the companies said no specific areas of integration of flight schedules or systems have been identified.” With the deal, Lufthansa infused $300 million into Jetblue– much needed cash for an airline with $433 billion in current debt. Jetblue Airways was once the darling of Wall Street and the US media, but an operations meltdown on Valentine’s Day 2007  tarnished its reputation and precipitated a fifty-percent loss in its value since April. The deal offers code-sharing opportunities for both carriers, although neither airline discussed the specifics of their future plans. Still, Lufthansa CEO Wolfgang Mayrhuber was bullish on future interline opportunities, saying “this investment presents Lufthansa with a compelling opportunity to invest in the U.S. point-to-point carrier market as the industry continues to evolve.” Lufthansa’s investment in Jetblue comes on the heels of the Open Skies Agreement, a treaty that allows European and American carriers to fly between the continents without restrictions. The agreement does not permit European carriers to fly point to point flights within the United States, however. A Lufthansa-Jetblue alliance provides Lufthansa with a domestic partner with an established New York City hub and sizable domestic network, while Jetblue gains an ally with significant international reach. With the deal, Lufthansa places itself in a good position to take over the US carrier– but only if American legislation preventing a foreign carrier from owning more than twenty-five percent of a US carrier is overturned. Some analysts have speculated that United Airlines, a Lufthansa partner, could purchase the remainder of stock necessary to earn majority ownership, sharing control with its Star Alliance partner.

Sources: Reuters, AP

Lufthansa to Launch Boeing 747-800i December 5, 2006

Posted by Andrew in Airbus, Boeing, Lufthansa.
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According to unnamed sources, German flag-carrier Lufthansa Airlines agreed in principle to purchase twenty Boeing 747-800 passenger aircraft. Sources close to both parties say that a formal announcement may come as early as tommorrow. Purportedly the deal has a list value of $5 billion, and Lufthansa could take options for twenty more of the aircraft. Lufthansa, a launch customer for the Airbus A380, will likely use the 747-800i as a replacement for its large, aging 747 fleet. Due to delays in the Airbus A380 program, Lufthansa is anticipated to take delivery of its first 747-800 only a few months after Airbus delivers the first A380 to Lufthansa. This order, once formally confirmed by Lufthansa, will be the first for the passenger variant of the 747-800. Analysts expect other carriers to follow suit now that Lufthansa has tested the waters.

Source: Reuters and WSJ

Emirates, Other Airbus A380 Launch Customers Reconsider Orders October 3, 2006

Posted by Andrew in Airbus, Emirates, Lufthansa, Singapore Airlines, Virgin Atlantic.
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Emirates and a slew of other carriers are reviewing their options as they prepare for a detailed formal Airbus announcement today about more delays in the A380 program. Emirates Airlines, which ordered 43 A380 aircraft, claims that the delivery of its aircraft will be delayed an additional ten months, with the first delivery in August 2008. On the delay, Emirates president Tim Clark remarked: “this is a very serious issue for Emirates and the company is now reviewing all its options.” One source claims that has Airbus has whittled the projected number of delivered aircraft in the first year from twenty-five to just two airplanes. Many aviation analysts expect a full disclosure of the problems plaguing the A380 program by Wednesday, one day after the EADS board meeting. Emirates is not the only airline affected by A380 delays. Singapore, Virgin Atlantic, and Lufthansa expect delays ranging from six months to over a year. The latest grumblings from Emirates are the strongest warning yet that a cancellation of orders is a possibility. The carrier will likely use the latest delays as a way to negotiate compensation payments or better prices from Airbus. Furthermore, some analysts believe that Emirates may cancel some or all of its order with Airbus for the A380 aircraft. According to a Reuter’s report, “with U.S. airlines still in financial turmoil, the Gulf is one of the big markets to capture along with low-cost carriers in Asia and a cancellation from Emirates would be a potentially serious blow in money and prestige for Europe’s jetmaker.” Emirates, which has publicly stated that the A380 is at the core of this strategy, can afford few more delays. With the turmoil at Airbus, Boeing has reportedly stepped up its efforts to sell its slightly enlarged, updated 747-800 aircraft. Although not a direct competitor to the A380 aircraft, it will fit a niche between the current generation of 747’s and the A380. Deliveries of the Boeing 747-800 are expected to begin in 2010. As Boeing seeks to capitalize on Airbus’ mistakes, the European giant is slated to undergo massive restructuring. With manufacturing and engineering operations being shifted between Germany and France, Airbus is trying to lift itself from the doldrums.

Source: Reuters

Lufthansa Places Order for Airbus Aircraft September 20, 2006

Posted by Andrew in Airbus, Boeing, Lufthansa, Uncategorized.
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German carrier Lufthansa announced this morning that it hard ordered both long-haul and short-haul aircraft from Airbus, with deliveries beginning in the coming months. As a stopgap measure, Lufthansa will receive five A330 aircraft over the next two years to make up for delays in the A380 program. In addition, the carrier is taking on ten short-haul A320 and fifteen A321 aircraft. The order for the A320 and A321 serves to both replace aging aircraft and bolster the size of the fleet. Still, Lufthansa management left open the possibility for an additional thirty commitments to the A320 family. Even with the recent order, Lufthansa may still make a substantial order for more long-haul aircraft. According to industry sources, Lufthansa management is contemplating the purchase of up to one-hundred aircraft in the coming months. With today’s order only accounting for one-third of that maximum number, could a larger Boeing or Airbus order be in store?

Source: Reuters