Nordic Aviation Capital purchases five ATR 72-500s for lease to Lufthansa
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Eurowings: new Munich routes outsourced to airberlin. Frankfurt hub may be next for Lufthansa's LCC
When Lufthansa began to transfer point-to-point short haul routes to its LCC Germanwings in 2013 it specifically excluded routes to/from its two main hubs at Munich and Frankfurt. Although its two main hubs have been less penetrated by LCCs than many other major European airports, this is changing. Moreover, competitor LCCs are growing rapidly across Germany and in other Lufthansa Group home markets. Even Air France-KLM established a Munich base for its LCC Transavia in summer 2016 (but this is under review). More ominously, Ryanair is to enter Frankfurt in summer 2017.
Lufthansa first revealed in summer 2016 that it was considering opening a Munich base for its LCC operations, now grouped under the Eurowings brand. On 21-Dec-2016 it announced plans to base four A320 family aircraft at Munich for 32 Eurowings routes from summer 2017.
Perhaps it was always inevitable that Eurowings would eventually extend to selected routes from Frankfurt and Munich, but agreements with pilots were understood to have limited the group's flexibility. Confirmation that the operation of Eurowings routes at Munich will be outsourced to airberlin under wet lease appears to have loosened this restriction. Eurowings routes from Frankfurt are also being considered.
Malaysia Airlines' Firefly Part 2: overcapacity at Kuala Lumpur Subang leads to restructuring
Overcapacity at Kuala Lumpur Subang Airport has forced the Malaysia Airlines Group to restructure its regional subsidiary Firefly. The airline has cut its fleet and implemented a new reduced schedule in hopes of improving yields and load factors.
Closer integration with Malaysia Airlines is being pursued, resulting in codeshares, frequent flier tie-ups and potentially a rebranding. Firefly remains an important component of the Malaysia Airlines Group, which also has restructured over the last two years, but a smaller operation is required to restore profitability in an extremely challenging marketplace.
The Subang market is relatively limited in size with only six sizeable domestic routes from Subang, all of which are now suffering from overcapacity due to aggressive and rapid expansion from Lion Group's Malaysian affiliate Malindo Air. The irrational dogfight that has emerged between Malindo and Firefly at Subang is a potential precursor of a bigger looming battle at much larger Kuala Lumpur International Airport (KLIA) between Malindo and the Malaysia Airlines Group.