1. Airline Briefing: Lufthansa
Sebastian Hollmeier, Director Network Planning FRA

2. Introducing Lufthansa Group ….
Passenger Airline Group
Germany: Lufthansa, Germanwings
Switzerland: Swiss, Edelweiss
Austria: Austrian Airlines
Italy: Air Dolomiti
Belgium: brussels airlines (45%)
Turkey: Sun Express (50%)
Aviation Services
Lufthansa Technik
Lufthansa Cargo
LSG Sky Chefs
Lufthansa Systems
Lufthansa Consulting
Lufthansa Financial Services

3. Lufthansa‘s Passenger Airlines Group
Fleet
More than 700 aircraft in service
More than 200 aircraft on firm order, and more to come
Global network
319 destinations
flights per week
seats per day
Alliance / Partners
Founding member of Star Alliance
Joint ventures with United, Air Canada, All Nippon Airlines
More than 200 additional codeshare destinations
Summer 2013

4. Like most other airlines, Lufthansa is fighting to be profitable
2012
Turnaround program „SCORE“
Reduce cost
Increase revenues
Synergies within the group
Target: 8% profit margin of each business segment
Annual report

5. Our network strategy …

6. Fundamentally different production schemes of airline
Point-to-Point
Hub-and-Spoke B A H A B

7. Advantage of Hub-and-Spoke System: Bundling Passenger Flows
For each destination multitude of markets connected
Many destinations served – many more than viable for local traffic
Even niche markets served efficiently
Large and efficient aircraft in use
High frequency of flights
Providing even alternate travel options for large volume nonstop markets
QUALITY + EFFICIENCY
Hub-and-Spoke

8. Hub-and-Spoke system: Larger and more efficient aircraft in use
Efficiency Long-haul
A380
526 seats A
221 seats
Efficiency Short-haul
A321
200 seats
CRJ700
70 seats

9. Optimizing transfer flows in the Hub-and-Spoke system (I)
The ideal flight plan
1. all flights arriving at the same time
2. all flights departing at the same time
a little later
Time of day
ARR
DEP

10. Optimizing transfer flows in the Hub-and-Spoke system (II) Example: Hub Frankfurt Summer 2013
Departing
flights
Morning
Evening
Arriving flights
Summer flight plan 2013, typical day, including partner flights

11. Example: Today‘s most recent flights from FRA and MUC to BUD
LH1338/13MAY, FRA – BUD, Arr. 14:10 LT
57 local pax booked from FRA, plus 133 transfer pax from 31 origins:
LH1676/13MAY, MUC – BUD, Arr. 12:25 LT
44 local pax booked from MUC, plus 109 transfer pax from 36 origins:
BCN BOS BRE DEN DFW DTW DUB EWR EZE GRU HAM IAD IAH JFK LAX LEJ LHR LUX MAD MIA OPO ORD OSL PHL SFO SIN TLS TSE YOW YVR YYZ
AMS ATH BCN BHX BIO BLQ BOS BRE BSL CDG CGN CLT DUS EWR FCO FMO GOT GRU HAJ HAM IAD JFK LIS LYS MAD MAN MRS NCE RTM STR TRN TXL VRN WAW YUL YYZ
Transfer pax of these two example flights only !

12. Our success: FRA is the leading hub in connecting European traffic FRA with 33% more European connecting passengers than PAR and AMS
+33%
+43% LH LH LX OS SN

13. MUC and FRA by far leading hubs in connecting INTRA-EUROPEAN traffic
x1,5 x2 x5

14. Multi-Hub system of Lufthansa Group
FRA MUC
Frankfurt
Munich
Brussels
Vienna
Zurich

15. Advantages of Multi-Hub System
 Offering attractive nonstop-services to Lufthansa group‘s hub airports Many destinations, high frequency, large and efficient aircraft
 Offering multiple travel options for connecting markets
Passengers‘ choice:
Total travel time
Preferred departure / Arrival time
Brand preference and service
Hub preference
Seat availability
(Promotional) Prices
Lyons
Beijing
Frankfurt
Munich
Zurich
Vienna

16. What does this mean for our route development?
Other than some of our competitors, the Lufthansa Group does not allocate „top-down“ markets/destinations to hubs.
Multiple connections to multiple hubs, even from smaller destinations, are desired as we believe in the benefits of the multi-hub-network.
Every hub / every group airline should grow as much as commercially viable. Every hub/airline is responsible for its own profitability and network development.
However, no route can be continued if not commercially viable. Adjusting the network is one aspect of our turnaround program „SCORE“.

18. Shaping the future together…
Despite air travel taxes, fuel prices, high-speed trains and video conferencing the air transportation sector will continue to grow
But it will change. Due to the competitive landscape and industry consolidation but even more so due to the general market trends:
Our customers are more price sensitive than ever before
And they still expect consistent high quality
To be successful in the future we all have to make sure that we meet these customers’ demands
We are ready – are you?
With our fleet expansion we will continue to expand!
We have plenty of ideas where to grow. But we do not have a rigid plan to follow, we are flexibly looking for opportunities

19. Shaping the future together…
We do listen to our customers‘ needs, so that capacity can follow demand. But we also know very well, that capacity does create demand
Keep in mind: Air traffic in general has a valuable macro-economic impact. But transfer airlines contribute by far the most to the local economy as they provide efficient connectivity to the whole world and serve corporate needs
Together with you, we will have to develop joint business plans, which traffic flows to serve and stimulate
Solid business cases are the key to success in this highly volatile industry!
How can airports contribute?
With an adequate (=lowest!) cost base, but still delivering quality for the customers
Know how about market demand and revenue potentials to reduce financial risk
Any form of (legal) support

20. Thank you for your attention!
Questions?