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Lufthansa Group looks for an Indian carrier to expand network

Lufthansa had a codeshare agreement with Jet Airways. But, since the grounding of Jet, the group is looking at new codeshares in the Indian market.

twitter-logoManu Kaushik | May 21, 2020 | Updated 09:11 IST
Lufthansa Group looks for an Indian carrier to expand network
Lufthansa scouting for partners in India

Leading European airline group Lufthansa Group Airlines is scouting for new partners in India. The group has a codeshare agreement with Air India under which the national carrier is connecting Lufthansa group's passengers from German carrier's four Indian gateways - Mumbai, Delhi, Chennai and Bangalore - to other cities in the country. The airline had a similar agreement with Jet Airways. But, since the grounding of Jet, the group is looking at new codeshares in the Indian market.

"Wherever Air India flies to, we have a codeshare. Now that Jet Airways has left the stage, we are looking at new codeshares to replace the ones that we have lost with Jet having being grounded," says George Ettiyil, Senior Director, Sales, South Asia at Lufthansa Group Airlines who has been heading the Indian operations for almost nine months.

Lufthansa group's codeshare agreement with Air India is not strictly bound to any number of seats. The agreement is beneficial for Air India as well because from Germany and Switzerland onwards, Air India passengers can fly to specific European destinations where the Indian national carrier does not operate.

Ettiyil says that a huge business is coming from Tier-II and Tier-III towns. "For any business to participate in the growth story of India, it needs to seriously look at Tier-II and Tier-III towns. This is true for Lufthansa as well. Ten years ago, four metros were catchment areas that we had to tackle, but business was coming from Tier-II cities. We have realised over the past four-five years that Tier-II and Tier-III are incredible growth stories. While the metros are growing without doubt, the potential of Tier-II and Tier-III cities is huge," he says.

As a European carrier, Lufthansa Group, which is starting Munich-to-Bangalore flight from April next year, is looking at its connectivity from the Tier-II and Tier-III cities to its gateways in India. That is where there is urgent need to find another codeshare partner.

Amid the growing buzz of low-cost long-haul international flights operating out of India, the group says that it has no plans to bring in low-cost intercontinental flights. "The two business models that we have right now (point-to-point connectivity, and hub-and-spoke model), we will use them to grow. With the prudent business model and proper governance, it is definitely possible to operate profitably in India. We are experiencing that. We are upping our game. Our Mumbai-Munich operation was an Airbus A330. We realised that the potential is much higher, and replaced it with A350," says Ettiyil.

Lufthansa Group, which is world's largest aviation group in terms of turnover and serves about 343 destinations in 103 countries, operates brands such as Lufthansa, SWISS and Austrian Airlines. It operates the global network from home market hubs such as Frankfurt, Munich, Zurich and Vienna. The group also has Eurowings brand, which offers short- and long-haul point-to-point services in the growing private travel market.

For the past several years, Lufthansa has been clocking double-digit growth in both passenger numbers and revenues in India. "Traditionally, Indian travellers are cost-conscious and look at best deals. Growing segment of Indian travellers want something better and over and above the basics. This has been driving Indian passengers to spend on better products. It is driven by the fact that for more than two decades, Indians have been travelling on business in all product categories that airlines have to offer. Because of the purchasing capabilities, even if they are private - leisure and bleisure - they want to travel in a better product. Indian aviation market is incredibly relevant globally," says Ettiyil.

The Lufthansa group operates six aircraft types out of India - Airbus A330, A380, A340, A350, Boeing 747-800, 747-400. It claims that distinct destinations that it offers are quite popular with Indian travellers.

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