German Government Strikes a Blow at oneworld Member airberlin

Update: I wrote this post yesterday morning but failed to hit publish. Minutes after I had it go live today, I learned that the German government has apparently already reversed this very strange decision. So it looks like all is well, for now, but there’s still no public explanation for this very strange story.

In what has to be one of the strangest legal decisions in aviation that I’ve seen, German authorities have decided Etihad and airberlin have to cease codeshares. No explanation is given for the decision.

The German regulator has to re-approve codesharing agreements twice each year, with the filing of summer and winter schedules. The Etihad-airberlin relationship has been consistently approved (six times) over the past three years until now.

airberlin struggled on its own, and attracted an investment from Etihad as part of the Abu Dhabi-based carrier’s efforts to grow into a global player from its base in the capital of the UAE.

Etihad has even been willing to make investments worse than La Compagnie in order to further this end. They’re investing in Alitalia, after all.

The German government, it seems, would like to strike a blow to the heart of the country’s number two airline.

According to Prock-Schauer, the decision affects about 46,000 bookings. However, all passengers will be transported as planned.

Airberlin, which will absorb most of the financial impact, said it will use all legal steps to fight against the LBA decision.

…Airberlin reportedly generates a turnover of €100 million ($127 million) per year with codeshare flights (with all partner carriers), according to several media outlets.

It will be extremely hard for air berlin to be an anchor in the new Etihad-based airline alliance without codeshares.

And it will be a struggle for the airline without their Etihad codeshare.

My prediction — sans any special expertise in German law or politics — is this capricious decision gets overturned.


About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. This is the quid pro quo for Lufthansa having to drop its route to AUH, due to excessive competition from Etihad. Ergo, clip Etihad’s wings and weaken your domestic competitor (AB) – two birds (no pun intended) killed with one stone.

    BTW, the latest is that the codeshares can continue until 3/31 – Gary, you need to post current news and not old news:)

  2. Having dealt extensively with the LBA back in the day when I ran Dusseldorf station for my former employer, and having had similar licensing applications denied or delayed for no real reason whatsoever, I would chalk this down quite simply to LBA bureaucracy rather than any sort of conspiracy theory.

  3. According to a newspaper article in today’s Sueddeutsche (German only: http://www.sueddeutsche.de/wirtschaft/luftfahrtbundesamt-etihad-und-air-berlin-duerfen-doch-gemeinsam-fliegen-1.2176698), the international agreement on traffic rights between Germany and the UAE currently allow UAE carriers access to four aiports in Germany on their own metal and a further three airports by way of codeshare, “limited to codeshare services only in the Federal Republic of Germany.” EY serves FRA, MUC and DUS, but cannot serve STR or BER, for example (no sufficent traffic rights). EY has in the past used flights of its “partner” AB between BER & AUH and then put an EY code on that flight. The LBA has now altered its reading of the traffic right agreement (probably due to successful lobbying by LH). It now wants a more literal reading of the wording “only within Germany”, so that the additional three destinations in Germany can only be served by codeshare within Germany, but not by codeshare between Germany and the UAE. So, EY could codeshare AB services from BER to FRA, MUC or DUS, but not to AUH. The article mentions that delegations from germany and the UAE will meet on monday to find a permanent solution.

    On a side note: The German ministry of transport has also mentioned that LH is currently putting its code to four destinations in Africa without having traffic rights to so and that it will only allow this practice for the time being…

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