airberlin announced (21-Feb-2013) its "Shape & Size" efficiency programme contributed EUR250 million to its income in 2012 while its strategic partnership with Etihad Airways delivered an additional EUR50 million in revenue with synergies and cost savings starting to take effect. The partnership saw Etihad Airways bring 219,000 passengers onto airberlin's network. airberlin CEO Wolfgang Prock-Schauer said the airline is confident it will "achieve further revenue enhancements and, above all, further cost synergies" with Etihad Airways. Mr Prock-Schauer also said the airline is confident its new turnaround programme Turbine "will enable airberlin to be competitive in the future and achieve sustainable profitability. One of the programme’s key elements is a focus on cost efficiency which involves implementing a range of initiatives, including a staff reduction." [more - original PR]
airberlin's efficiency programme and partnership with Etihad generated EUR300m
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airberlin: another record loss, but "Jack of all trades" may have a chance to escape Groundhog Day
The German airline airberlin made another record loss in 2016 and has reported net losses in eight of the past nine years. It has lost a cumulative EUR1.9 billion in the five years since Etihad became a shareholder. The only small net profit, in 2012, was because Etihad bought its loyalty scheme. The first results for this year show that losses worsened in 1Q2017.
The better news is that, with shareholder Etihad's support, airberlin has sufficient liquidity to continue, and it has a restructuring plan with a new CEO. If the story of losses, Etihad support, restructuring and a new CEO sounds familiar, it is because it is. Airberlin has been through this almost as many times as Bill Murray in Ground Hog Day.
Crucially, though, the latest restructuring does seem genuinely radical. As new CEO Thomas Winkelmann has said, airberlin used to be a "Jack of all trades", but master of none. Past restructurings made it a Jack of fewer trades, but never fully resolved this lack of focus. The current plan brings it focus as a network airline – scaling down, and largely exiting from leisure. There is still much execution to be done, and competitive conditions are unlikely to ameliorate, but Mr Winkelmann may have a better chance than his predecessors.
airberlin restructuring: summer capacity minus 31%; long haul growth; threat of Eurowings looms
The main elements of Air Berlin Group's latest restructuring are taking shape. In Feb-2017, 38 of its aircraft began a wet lease agreement to operate on behalf of the Lufthansa Group. On 26-Mar-2017, the majority of airberlin's tourist routes were reassigned to NIKI, prior to the transfer of its Austrian subsidiary to a new airline that will also include TUIfly and be part owned by Etihad. This leaves the core "new" airberlin airline to focus on developing its network operation from its hubs in Duesseldorf and Berlin.
Data from OAG for the summer 2017 schedule show that airberlin's total seat numbers will be reduced by 31% versus last summer, focusing on Europe, mainly due to these actions. On long haul, however, airberlin's US seat capacity will grow by 57% this summer, with four new routes. On routes to Latin America, airberlin's growth of recent years has been halted by a more intense competitive landscape. Lufthansa's low cost subsidiary Eurowings has grown rapidly to destinations served by airberlin in Latin America.
Eurowings is also now turning its attention to the US. They operate from different German airports, but Eurowings could become a growing thorn in airberlin's side.