The aviation industry in Europe is in transition, and the EU Commission’s recent decision represents a significant turning point: Lufthansa has received final approval to join ITA Airways. With the approval granted on Friday, November 29, 2024, the German aviation group has free rein to acquire a strategic stake in the Italiane airline. The move is part of a comprehensive realignment and consolidation of the European aviation market, which is characterized by economic challenges and changing passenger needs.
Lufthansa will apply to join ITA Airways in July 2024, but approval from the EU Commission was subject to conditions. In order to ensure that Lufthansa’s market position does not increase too much as a result of this takeover, the companies must prove so-called « remedy takers » – competitors who take over slots at Milan-Linate and Rome-Fiumicino airports and thus ensure fair competition. This airflage is intended to prevent Lufthansa from assuming a dominant position through the takeover of ITA Airways and restricting competition on certain European and international routes.
On November 29, 2024, the EU Commission finally approved a remedy package that allows Lufthansa to take over a 41 percent stake in ITA Airways. In the coming years, Lufthansa expanded its shareholding to full control in several steps. This move will strengthen Lufthansa’s competitive position in European aviation and significantly expand its presence in the southern European market.
The role of competitors and the industry’s response
To protect competition, new regulations have been implemented. Easyjet, one of Lufthansa’s main competitors in European short-haul flights, will be involved in the event: from spring 2025, the British airline will station five aircraft in Milan-Linate and three in Rome-Fiumicino. This strategic strategy is Easyjet, and during the transaction freed slots were used and its position in Italy became festivals.
In addition, the cooperation between Lufthansa and ITA Airways will enable competitors IAG (International Airlines Group) and the airline alliance Air France-KLM to use the slots in Rome for feeder flights. These new connections are intended to ensure that passengers can connect in an acceptable time even for connections to North America – including Washington DC, Chicago, San Francisco and Toronto. This is intended to prevent Lufthansa from having excessive market power on certain routes.
Strategic importance for Lufthansa
The takeover of ITA Airways is a strategic step for Lufthansa that will have far-reaching consequences. The Italian airline not only offers Lufthansa expanded routes and access to new market segments, but also the opportunity to build on its position as a leading European aviation group. The integration of ITA Airways is intended to enable Lufthansa to supplement its hubs in Frankfurt and Munich with additional connections and thus strengthen connections to important international destinations.
With this measure, Lufthansa is pursuing a long-term growth strategy that aims to secure and expand its market position. This strategic strategy is intended to be carried out in line with the European airlines in immersive strength to face competition from low-cost carriers and changing passenger needs.
Looking into the future: Impact on the aviation market
The approval by the EU Commission could have far-reaching consequences for the aviation industry. The measures taken to maintain competition, such as giving slots to competitors, show that regulators in Europe are committed to maintaining a fair market. However, it remains to be seen how these regulations will impact the market in the long term. The challenges in the industry, such as high operating costs and the need for digitalization, are also factors that will influence the development of market conditions.
Competition on the European market is likely to become more intense as a result of the takeover of ITA Airways. Passengers can expect a wider choice of connections and potentially better connectivity in Europe and North America, which could lead to increased demand and potentially an improvement in service quality.
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