#191 The German crane spreads its wings
Lufthansa Airlines, one of Europe’s largest and most respected carriers, has built a global reputation for its premium services and vast network of international routes. In 2024, Lufthansa Group kicked off the year with significant developments in the aviation sector. The European Commission approved the group’s acquisition of a 41% stake in ITA Airways, Italy’s national airline. Painful as it may be for Italians, this strategic move signals important shifts in alliances and the potential for expanded travel options, as Lufthansa deepens its presence in the European market and strengthens its network. The acquisition marks a new phase of collaboration and growth, offering exciting prospects for both passengers and the aviation industry.
Over the years, Lufthansa has continued to expand its global reach through several key acquisitions aimed at strengthening its market position and improving operational efficiency. Notable acquisitions include Swiss International Air Lines (2005), Austrian Airlines (2009), Brussels Airlines (2016), and parts of Air Berlin (2017). Each of these acquisitions has played a crucial role in bolstering Lufthansa’s presence in both premium and budget markets while expanding its global network. The acquisition of Swiss International Air Lines allowed Lufthansa to tap into the premium Swiss market and expand its transatlantic routes, targeting high-end customers. This move helped Lufthansa enhance its global footprint while maintaining its premium standards across different markets. Similarly, the acquisition of Austrian Airlines reinforced Lufthansa’s presence in Central and Eastern Europe, adding important routes to Eastern Europe and Asia. The purchase of Brussels Airlines in 2016 provided Lufthansa with access to a well-established network in Africa. At the same time, Brussels Airlines’ lower cost structure allowed Lufthansa to optimize operational efficiency and compete more effectively against budget airlines. Finally, Lufthansa’s acquisition of parts of Air Berlin after its bankruptcy enabled it to gain valuable airport slots and aircraft, strengthening its position in Germany. The “Kranich” (German for “crane”) consistently proves how expansion through acquisition is a great alternative to grow and expand.
Case written by Agassy Manoukian, American University of Armenia, with slight adaptations by Gerhard Apfelthaler.