Global Challenges and chances in the Near and Middle

www.lufthansa.com
German – Near and Middle East
Aviation Conference
Berlin
09 June 2010
Global Challenges and chances in
the Near and Middle East region
Challenges having an effect on the air transport industry are numerous
...global financial crisis:
2008 – kicked off by Goldman Sachs
2009 – „a lost year“- shift in demand affects yields
2010 – recovery (to former levels?)
... ongoing disturbance by „sub-crises“
January – storm in Germany and Europe
February – pilot‘s strike
March – heavy snowfall
April – volcanic ash
May – (?)
... further economic development in Europe
the Greek tragedy – value of the Euro (?)
... bilateral relations
discrimination
protectionism
subsidization / state aids
Challenges....
...in the regulatory field
European Emission Trading Scheme (ETS) vs. worldwide solution
Infrastructure constraints
Safety / Security
... in external factors
where will the fuel price go?
... in competition
by low-cost/no-frill carriers
on short haul routes in Germany and Europe
on intercontinental routes (Gulf carriers)
... to be encountered by strengthened local / regional competence!
... with particular focus on Near and Middle East markets
... Lufthansa‘s strong position in their variety of business units make the
company robust against external threats!
Lufthansa: who we are and what we do.....
On any one day, Lufthansa…
ƒ makes more than 2,250 take-offs and landings,
ƒ carries about 193,000 passengers and more than
5,200 metric tons of freight,
ƒ serves more than 1.17 million meals,
ƒ answers to about 27,400 phone calls,
ƒ and services more than 1,000 aircraft (own and
third party) through its Lufthansa Technik unit.
The Lufthansa Group and its five business segments
Passenger Airline Group
The Group’s airlines rank among
the world’s leading carriers.
Logistics
Lufthansa Cargo –
One of the world's leading cargo carrier
in international air traffic.
MRO
Lufthansa Technik –
Leading supplier of engineering services
in the world's airline business.
IT Services
Lufthansa Systems –
One of the world’s leading IT service providers
for the airline and aviation industry.
Catering
LSG Sky Chefs –
World's largest provider of airline
catering
and integrated in-flight solutions.
Lufthansa passenger airline: destination portfolio
Summer schedule 2010 – 205 destinations in 82 countries worldwide
Europe (w/o Germany)
106 destinations
in 37 countries
North America
Germany
21 destinations
in 2 countries
17 destinations
Asia Pacific
Middle East
14 destinations
in 11 countries
Africa
16 destinations
in 14 countries
South America
4 destinations
in 4 countries
Destination map refers to the summer timetable 2010.
27 destinations
in 13 countries
From Germany to the Near and Middle East
In the summer 2010 schedule period ...
.... 17 passenger carriers operate
.... 243 weekly flights from Germany
.... to twelve countries
.... and 20 destinations
in the Near / Middle East region
Capacity increased by 11pct
compared to 2009
Lufthansa is # 1 in weekly frequencies
and seats offered
The Lufthansa Passenger Airline is well established and represented
.... eleven countries
.... fourteen destinations
.... 79 weekly flights from Germany
(plus seven compared to 2009)
.... 17,100 seats per week and direction
4
4
4
4
4
.... 1.82 mill. Passengers (2009)
.... plus 29pct vs. 2008
4
4
4
4
44 4
4
4
Most valuable asset is Lufthansa‘s long-term dedication and reliability
Teheran: daily flights (12-09-56)
Beirut: twelve weekly flights (12-09-56)
The first flights to the region
landed in September 1956 –
Teheran / Beirut
4
4
4
Erbil: four weekly flights (25-04-10)
4 Bagdad: four weekly flights (30-09-10)
4
Kuwait: daily flights (05-07-63)
Amman: daily flights (02-04-85)
4
Dammam: three weekly flights (26-03-00)
The youngest achievement – Erbil –
looks back at a „history“ of
six weeks
4
44 4
4
Riad: ten weekly flights (01-04-87)
4
4
Jeddah: daily flights (07-05-69)
Challenge: new destinations?
(Bagdad)
4
Doha: daily flights (15-06-98)
Bahrain: daily flights (02-04-85)
Abu Dhabi: six weekly flights (01-11-76)
Dubai: 12 weekly flights (03-05-76)
Muscat: six weekly flights (30-09-83)
4
Sana: two weekly flights (30-03-86)
Passenger airlines within the Lufthansa Group
ƒ Passenger transport is the core business of the Lufthansa Group.
ƒ The group recently acquired a number of airlines and is a driving force in the
consolidation of the European air transport sector.
ƒ Together with its airline subsidiaries, Lufthansa German Airlines carries some 80
million passengers a year.
ƒ In addition to Lufthansa German Airlines, the following major airlines are part of
the Lufthansa Group:
4 Swiss International Air Lines
Zurich, Switzerland
4 JetBlue
New York JFK, USA
4 Brussels Airlines
Brussels, Belgium
March 2005
100% stake
January 2008
15.6% stake
June 2009
45% stake (target 100%)
4 British Midland
London Heathrow, UK
September 2009
100% stake
4 Austrian Airlines
Vienna, Austria
September 2009
100% stake
Presence of the Lufthansa Group in Near and Middle East
Nearly 200 passenger flights per week to twelve countries and 16 destinations in the region
Lufthansa
101 weekly flights to 14 cities
BEY
DAM
THR
EBL
Hubs: Frankfurt and Munich (Germany)
BGW
AMM
Swiss International Air Lines
14 weekly flights to 2 cities
KWI
DMM
RUH
BAH
Hub: Zurich (Switzerland)
DXB
DOH
MCT
AUH
JED
Austrian Airlines
33 weekly flights to 5 cities
Hub: Vienna (Austria)
SAH
BMI British Midland
43 weekly flights to 7 cities
Hub: London-Heathrow (UK)
Destination map refers to the summer timetable 2010.
1
„Flight“ refers to a round trip (multileg flights counted twice).
Our new flagship: the Lufthansa-Airbus A380
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The delivery of the first Airbus A380 on May 19, 2010 marked the beginning of a
new era in the history of Lufthansa
The A380 is the biggest commercial passenger aircraft in the world
During 2010 Lufthansa adds four units of the new aircraft to its fleet
Length:
72.7 m
# of seats:
526
Wingspan:
79.8 m
First/Business/Economy
8 / 98 / 420
Height:
24.1 m
Range:
12,000 km
Logistics
ƒ
Within the Lufthansa Group, Lufthansa Cargo AG is
responsible for the sale and operation of freight
transport.
ƒ
Lufthansa Cargo has 19 Boeing MD-11F freighter
aircraft at its disposal. It also uses the freight
capacities of Lufthansa passenger aircraft.
Additional capacities are chartered as needed.
ƒ
In 2009, the airline’s route network comprised
about 300 destinations worldwide.
ƒ
Lufthansa Cargo has joined forces with DHL
Express to found the freight airline AeroLogic,
which started operations in 2009.
Aerologic – Lufthansa Cargo‘s Joint Venture with DHL Express
ƒ Aerologic GmbH was founded
in September 2007 as a joint
venture between Lufthansa
Cargo and DHL Express.
ƒ After the ramp-up phase and the
delivery of the first Boeing 777F
in May 2009, AeroLogic started
its operations in June 2009.
ƒ Three more aircraft joined the
fleet during 2009.
ƒ Another four Boeing 777F
will complete the fleet.
Maintenance / Repair / Overhaul
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With a market share of 15 percent, Lufthansa
Technik AG is the world’s leading provider of
maintenance, repair and overhaul (MRO) services
for civil aircraft.
The Hamburg based wholly owned Lufthansa
subsidiary offers a broad service portfolio in
maintenance, repair and overhaul of civil aircraft
to more than 600 customers worldwide.
Lufthansa Technik is the world’s first company in
the MRO industry to hold an integrated
certification in accordance with ISO 14001
(quality), EMAS (environment) and OHSAS 18001
(job safety).
To take specific advantage of the growth potential
in emerging countries in Asia, the company has
operated the joint-venture Ameco Beijing in
cooperation with Air China for 19 years.
Lufthansa Technik Group: An overview
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690 customers worldwide
2,000 aircraft under exclusive contracts
500 jetliners under Total Technical Support TTS®
1,700 aircraft inspections per day
31 subsidiaries and affiliates worldwide
60 line maintenance stations with Lufthansa Technik staff worldwide
5.9 billion Euros in revenue*
26,000 employees worldwide
*Lufthansa Technik AG and all companies of Lufthansa Technik Group in 2009.
Lufthansa Technik: Global presence for more than 670 customers
Selected customers, March 2009
Lufthansa Technik – current activities
Reference Customers
Ethihad Airways
Saudi Arabia Airlines
Qatar Airways
Gulf Air
Royal Jordanian
Jazeera Airways
Current Business
Main Barriers
Main Business:
ƒ Component Support
ƒ Engine Maintenance
ƒ Landing Gear Services, Base
Maintenance, Cabin Modification, etc.
ƒ No access to specific markets due to
current Embargos (e.g. Iran)
ƒ Competition
Lufthansa Technik – future opportunities
ƒ
Airlines in the ME Region increased their
capacity in October 2009 by 15,8% with an
increase in demand by 14,3%.
ƒ
Emirates and Etihad have a combined
order backlog of more than 260 A/C.
ƒ
Young fleets are dominated by WBs
(>50%)
357
ƒ
Fleet of NME carriers is growing by 20% in
2010.
52
271
Î The Middle East offers excellent
opportunities for cooperation and
market growth
Aircraft Growth
from 2009 to 2010:
573 (+ 107 AC) = 680
800
600
324
400
200
36
213
Narrow-Bodies (e.g. A320, B737, etc.)
0
2009
2010
Regional Jets (e.g. CRJ200, ERJ190, etc.)
Wide-Bodies (e.g. A340, A380, B777, etc.)
The return of the Super Star - Comeback of a legend....
... and another challenging project for Lufthansa Technik!
ƒ The Super Star was the
culmination in the history of
propeller driven transport
aircraft.
ƒ To make a last Lockheed
L-1649A airworthy again is
a special honour and
challenge for Lufthansa
Technik.
Catering
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LSG Sky Chefs is the worldwide leader in
providing solutions for airline catering and inflight management.
ƒ
In 2008, the wholly-owned Lufthansa
subsidiary produced 427 million meals for
more than 300 airlines, which corresponds to a
market share of about 30 percent of global
airline catering.
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In addition to other ground services, LSG Sky
Chefs also operates airport lounges and retail
outlets.
Competence worldwide in 202 locations
North/
Latin America
Wholly-owned facilities
Joint venture facilities
Number of CSCs
Europe/Middle East/
Africa
51
43
94
Wholly-owned facilities
Joint venture facilities
Strategic partnerships
Number of CSCs
Asia/Pacific
52
16
8
76
Wholly-owned facilities
Joint venture facilities
Strategic partnerships
Number of CSCs
8
23
1
32
IT-Services
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Founded in 1995
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Head office in Kelsterbach near Frankfurt/Main,
with branches in 14 countries
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Around 3,000 employees worldwide
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Revenue in 2009: EUR 605 million
Lufthansa Systems is one of the leading IT service
providers for the airline and aviation industry.
The system integrator looks after more than 200
customers worldwide and offers the entire spectrum
of services based on information technology.
The business segment includes the divisions Airline
Management Solutions, Passenger Airline
Solutions, Airline Operations Solutions, Industry
Solutions and Infrastructure Services.
Its computer center – located at the company’s
headquarters – is one of the most advanced and
highest performing facilities of its kind in Europe.
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A synopsis of Lufthansa Systems’ activities in the Middle East
ƒ Important regional market for Lufthansa Systems
ƒ 25 customers (airlines, VIP operators)
ƒ 23 further prospects
ƒ Revenue from customers in the Middle East has steadily
increased over the years and is forecast to continue its growth
ƒ Local Service Management Office in Dubai
ƒ Airlines in the Middle East have traditionally been early
adopters of new products and services from Lufthansa
Systems, e.g.
ƒ Lido/Flight: Emirates
ƒ Electronic Route Manual: Emirates
ƒ Integrated Operations Control Center: Tunisair
ƒ SkyConnect: Etihad
Airlines in the Near and Middle East using Lufthansa Systems‘ services
and products
„ Tunisair
„ Nouvelair
„ Syrian Air
„ Middle East Airlines
„ EgyptAir
„ Lotus Air
„ Iran Air
„ Iran Aseman Airlines
„ Royal Jordanian
„ Kuwait Airways
„ Gulfair
„ Saudi Arabian „ Qatar Airways
Airlines
„ Yemenia
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Emirates
Etihad
Air Arabia
FlyDubai
Lufthansa Consulting – offering its internal and external experts‘ network
Clients are distributed all over the world
STAR Alliance – to the benefit of the customer
Lufthansa. There is no better way to fly!
Peter Schnoelzer
Director
International Relations
& Government Affairs
Deutsche Lufthansa AG
FRA CP
Lufthansa Aviation Center (B0.608)
Airportring
60546 Frankfurt
Phone
Fax
Email:
+49 69 696 57900
+49 69 696 98 57900
peter.schnoelzer@dlh.de