When thinking of the Lufthansa Group, the first thing that comes to mind for
most people is likely its core carrier, Lufthansa. Many others will also be aware
that the group also includes a number of other airlines, including SWISS,
Austrian, Brussels Airlines, and Eurowings. But this is truly just the tip of the iceberg,
as the Lufthansa Group's activities have also included the modification of aircraft for VIP
and government use, aircraft insurance, as well as consultation services for other airlines.
Let’s look at just how big this company is, in today’s video.
Let's start by examining the most well-known parts of Lufthansa Group - its airlines.
The most well-known carriers under the group's umbrella are as follows:
Lufthansa (with around 300 aircraft) SWISS (with about 85 aircraft)
Austrian (which has over 60 aircraft in its fleet) Brussels Airlines (with more than 40 aircraft)
And Eurowings.
Including Eurowings Discover and Eurowings Malta, the Eurowings brand has about 140 aircraft.
It doesn’t stop there. There are actually quite a few more airlines that are wholly-owned by the
Lufthansa Group. Listed by Planespotters.net, these subsidiaries are as follows:
Italian carrier Air Dolomiti and its 19 aircraft,
Swiss leisure carrier Edelweiss Air and its 17 aircraft,
And then regional carrier Lufthansa Cityline, which operates about ~50 aircraft.
It doesn't stop there as the Lufthansa Group has a joint venture with fellow Star Alliance member
Turkish Airlines in the form of SunExpress. This Turkish-German leisure operator was
founded in 1989 as a partnership between the two major carriers and offers numerous direct
connections between Europe and Turkey with its fleet of 50 Boeing 737s. Ownership is
split right down the middle, with Lufthansa and Turkish each having a 50% share of SunExpress.
On the topic of joint ventures, there is also cargo operator Aerologic. This
freight carrier is jointly owned by Deutsche Post and Lufthansa through
their respective subsidiaries, DHL Express and Lufthansa Cargo.
Similar to SunExpress,
each partner has a 50% share. AeroLogic operates a fleet of 21 Boeing 777Fs.
And finally, staying on the topic of cargo, we have the cargo divisions of the Lufthansa
Group airlines. Unsurprisingly there’s Lufthansa Cargo and its fleet of 777Fs,
as well as Swiss World Cargo and Brussels Airlines Cargo.
While Lufthansa Cargo has its very own fleet of dedicated freighters,
other subsidiaries simply utilize the belly holds of their respective passenger airlines.
The first company we’ll examine outside of Lufthansa Group’s airlines is LSG Group.
For now, the LSG Group business remains with Lufthansa Group. However,
Lufthansa Group is in the process of selling off LSG Group and its activities. But,
until this happens, it's worth looking at this long-time subsidiary and its activities.
LSG Group has two main activities: Aviation catering and retail.
The businesses carrying out these activities are LSG Sky Chefs for catering, and Retail
inMotion for on-board retail, product development, and technology solutions.
Interestingly, LSG Sky Chefs isn't just limited to preparing inflights meals.
Indeed, this firm also provides services for airport lounges.
This ranges from basic food-and-beverage services all the way to full lounge management – including
lounge cleaning, provisioning, maintenance, reception and more.
In terms of airline catering, the LSG Group has a significant amount of clients beyond
Lufthansa Group Carriers. The group signed new contracts with Condor, Greater Bay Airlines,
Turkish Airlines, Virgin Atlantic, Vietnam Airlines, and Air New Zealand in the past year.
Existing contracts with the likes of Copa Airlines covering 23 stations in North America and Canada
for another three years, China Southern Airlines in Thailand, and GOL operations in Brazil.
As mentioned, LSG Group and its businesses won't be part of the Lufthansa Group for much longer.
This part of the group has been sold off to European firm AURELIUS Group.
The agreement was announced without either party disclosing the sum, although the LSG Group ended
the fiscal year 2022 with a consolidated revenue of €1.96 billion ($2.15 billion).
The deal includes all 131 LSG Sky Chefs Customer Service Centers across the Americas,
Asia-Pacific, and quote-unquote "Emerging Markets" regions.
The group previously sold off its European activities (LSG Europe) to gategroup in 2019.
Notably, one of gategroup's more recognized brands is Gate Gourmet.
The sale to AURELIUS Group is expected to close by the third quarter of this year,
pending all relevant external approvals and internal carve-out activities.
Moving on, one business that won't be divested from the Lufthansa Group any
time soon is maintenance, repair, and overhaul (MRO) services provider Lufthansa Technik.
Just like LSG Group, Lufthansa Technik's reach is truly global. The company has
locations and wholly-owned subsidiaries scattered around the world - from Hawker
Pacific Aerospace in Burbank, California, to Lufthansa Technik Philippines in Manila.
The maintenance and repair side of Lufthansa Technik is fairly clear: The company offers
everything aircraft owners and airline customers need to get aircraft off the ground and into the
air. This includes engine servicing and component loan and exchange services. However, one of the
more interesting parts of Lufthansa Technik is its aircraft modification activity. The company
can transform aircraft into secure and luxurious transportation for heads of state - as has been
done for the government of Egypt's Boeing 747-8i and the Indian government's Boeing 777-300ER.
Of course, modification services aren't limited to government aircraft for heads of state as the
company is happy to fully modify the interiors of private jets for the ultra-rich as well.
Lufthansa Technik can also modify aircraft to become aeromedical transportation or emergency
evacuation vehicles. In recent times, this was well-demonstrated with the transformation of
several Airbus A321LRs for the German government. These narrowbody aircraft will be able to
convert from transportation for VIPs to troop transport, or even medical evacuation aircraft.
Moving on, it’s quite clear that operating an airline is incredibly
complex as we've explored in our "How To Start An Airline" series of articles and videos.
The Lufthansa Group and its subsidiary, Lufthansa Systems,
appears to offer everything an airline needs to get their business off the ground.
From network planning, to flight scheduling to fleet management, it looks like Lufthansa
Systems has I.T. solutions for all things related to running an airline. Of course,
if you aren't sure what IT solutions are needed, the company has its own consulting service, which
will guide customers through operations, commerce, MRO, and more. Lufthansa Systems even offers an
"Airline Crisis Assistance Package," which guides customers through major crises, such as COVID-19.
While Lufthansa Systems appears to have its own consulting division focused on IT,
the firm "Lufthansa Consulting" is a company of its own. This entity offers operational,
commercial, and financial consulting to groups ranging from airlines to
airports and even to civil aviation authorities.
Next is Lufthansa Aviation Training. This company would most obviously be the entity
carrying out pilot and cabin crew training for Lufthansa Group airlines. However, this firm
is open for business and offers its training services to customers outside the airline.
Not only does Lufthansa Aviation Training train aircraft and helicopter pilots, but it also
offers safety and emergency training to cabin crews, as well as service training for flight
attendants - ranging from initial training all the way to first class and senior cabin crew roles.
Lufthansa Aviation Training claims to have the largest simulator fleet in
Europe with over 50 full flight simulators and training devices for all major aircraft types.
Its six training sites are located in Berlin, Essen, Frankfurt, Munich, Vienna, and Zurich.
Let’s wrap things up by briefly looking at a few more subsidiaries.
There are a few more surprising and less-surprising companies that are
fully or partially owned by the Lufthansa Group.
Less surprising are the entities known as Lufthansa Holidays and helpAlliance.
The tour and holiday company known as Lufthansa Holidays offers travel packages that include
transportation and accommodation. This is something many airlines do,
with Air Canada and Air Canada vacations being just one of many other examples.
The existence of a charitable division is also something many multinational
corporations set up for themselves. In the case of Lufthansa Group, its helpAlliance
is focused on working for children, teenagers and young adults who are in need worldwide.
Two of the more surprising Lufthansa Group subsidiaries are AirPlus International and Delvag.
AirPlus International, legally known as "Lufthansa AirPlus Servicekarten GmbH"
provides corporate payment solutions for 49,000 customers around the world. The company offers
business travel management solutions for corporations, and offers central accounts,
corporate and virtual cards, as well as digital procurement tools.
Delvag, another wholly-owned Lufthansa Group company, provides insurance - unsurprisingly,
aviation insurance. However, this company's offerings go beyond aviation,
and include transportation and marine insurance.
While Lufthansa Group might be offloading its LSG Group subsidiary this year,
it might just pick-up another airline at the same time. The company is set on acquiring a
stake in Italian national carrier ITA Airways and has publicly expressed its intention to
do so, submitting an offer to the Italian Ministry of Economy and Finance in January.
According to Lufthansa Group, "the plan is to agree on the initial acquisition of a minority
stake as well as on options to purchase the remaining shares at a later date."
In its statement, the firm added, "for Lufthansa Group, Italy is the most important market outside
of its home markets and the US. Italy’s importance for both business and private
travel lies in its strong export-oriented economy and status as one of Europe’s top vacation spots."
At the time, the deal has yet to be finalized - but, at the time of this
video’s production - Lufthansa seems to be quite close to getting what it wants.
So how much of Lufthansa Group did you know about,
and how much of it was new to you? Share your thoughts by leaving a comment!