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Etihad-Lufthansa partnership: Lufthansa – the good guys of globalisation, starting along the road

Pragmatism is forcing the Lufthansa Group to compromise its legacy outlook and adapt its rhetoric as it cautiously welcomes into its nucleus the Etihad Aviation Group. Lufthansa and Etihad’s 01-Feb-2017 USD200 million catering and engineering deal may seem underwhelming, but it brings Etihad into other areas of Lufthansa Group’s business – and management. After being so flagrantly opposed to Gulf airlines, Lufthansa Group CEO Carsten Spohr recognises he needs to change internal mindsets while not advancing faster than ultraconservative unions will allow. Mr Spohr also says there is potential for a JV with Etihad.

As with recent Etihad cooperation – addressing ailing airberlin, and a new simple codeshare – the benefits of the latest deals are tilted towards Lufthansa. Lufthansa has yet to bring Etihad into its core to help address its fundamental cost and network problem – as it surely must do. Such a deal would leverage Etihad’s fundamental business of a hub in Abu Dhabi.

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