Lufthansa looks beyond Jet Airways for code-share pact

Germany-based Lufthansa Group, which has a code-share agreement with the now-grounded Jet Airways, is looking beyond its former partner.

Jet ceased its operations "temporarily" from April 17 after lenders refused to infuse any interim emergency funding.

The airline group which operates Lufthansa and its premium subsidiary SWISS in India is currently scouting for other Indian airlines for feeding traffic for onward journey to Europe and other international destinations.

Lufthansa is looking to tap international traffic from Tier-II Indian cities, which according to several estimates is growing close to 10% annually. Lufthansa has similar interline agreements with national carrier Air India and Tata Group-Singapore airline promoted Vistara for certain routes. Though low-cost carriers (LCCs) including market leader IndiGo and SpiceJet are on the radar for Lufthansa, the challenge has been the different operating platform, the group officials said.

George Ettiyil, senior director, South Asia, Lufthansa Group, said the complexities arise when a passenger needs to transfer, onward check-ins, etc, which become costly for LCCs as it changes their cost structure. "So we are open right now. In two-three months we will have a new programme of partnership in India as we have to fill up now, since Jet Airways is not there in the market." "At the same time, we are still observing what's happening to Jet Airways," Ettiyil said.

According to an estimate by Airport Authority of India, Tier II cities such as Ranchi, Lucknow, Surat, Vijayawada, Bhubaneswar and Varanasi are driving the aviation growth story in the country with impressive growth year after year. Around 26% growith in coming from Tier-II cities. With years of double-digit growth, India is expected to emerge as the world's third-largest aviation market within the next five years.

Interestingly, IndiGo has a tie-up with Turkish Airlines while Gulf-based Emirates got into a similar agreement recently with SpiceJet. On being pointed this out, Ettiyil said, "So far from a technical point of view, these are not adequate for our requirements. But I am quite confident with new technologies this kind of partnerships will be possible."

He said it is more about the mutual commercial benefit which determine the partnership between the airlines.

He said the effect of the closure of Pakistani airspace on Lufthansa was immense, especially for flights flying to or from Delhi, where the re-routing causes delay of about two hours. "We have not evaluated the losses of that yet," Ettiyil said. Further, the cancellation of flights by Lufthansa's partners United Airlines and Air Canada due to airspace closure issue has helped the former with full flights.

The Lufthansa group operates 56 flights in India from Delhi, Mumbai, Bengaluru and Chennai. The airline had to shut its operations from Pune due to runway limitations at the airport. The Pune operations were carried out by Private Air with specially modified engine and seating configuration. Private Air later went into bankruptcy, forcing Lufthansa to operate the sector for a brief period before closing it down earlier during the year.

"We are now assessing new options, someone who is able to either operate that same aircraft or perhaps someone who has aircraft of similar built." The airline executive said they are in talks with one or two operators though they are difficult to find ones with this kind of aircraft.

FLYING TOGETHER

• Lufthansa is looking to tap international traffic from Tier-II Indian cities, which according to several estimates is growing close to 10% annually
   
• Lufthansa has similar interline agreements with national carrier Air India and Tata Group-Singapore airline promoted Vistara for certain routes