Germanwings has preserved Lufthansa's market share, but still has too many legacy issues for a LCC
Last month, Lufthansa confirmed plans to extend its low-cost operations under what it terms its 'Wings concept'. Short haul LCC subsidiary Germanwings will continue to expand, with a renewed emphasis on using group company Eurowings to provide it with capacity. Eurowings' pilots are under a separate (more flexible) contract from those of Lufthansa and Germanwings and its 23 Bombardier CRJ900s are to be replaced with an equivalent number of A320ceo aircraft.
Perhaps referring to this, and to Lufthansa's low cost long haul plans, Ryanair CEO Michael O'Leary* said that Lufthansa "has some bizarre plan about establishing a new low-fare airline." He added: "Unfortunately they started with a high-fare airline called Germanwings and they'll need to do a lot more than call it that and paint it yellow to make it a low-cost carrier."
Lufthansa began transferring all its European point to point routes that do not serve its Frankfurt and Munich hubs to Germanwings in Jul-2013. Just over 15 months on, we review its capacity growth and the impact on the market share of Lufthansa/Germanwings in this segment.
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