Lufthansa Group is planning some major changes to how it does business, in order to both increase profitability and improve customer satisfaction. That combination always makes me a bit skeptical, especially when it’s coming from Lufthansa Group.
In this post:
Lufthansa’s controversial “Matrix Next Level” strategy
Europe has three major global airline groups. One of those is Lufthansa Group, which includes Lufthansa, SWISS, Austrian, Brussels, ITA, Eurowings, Discover, etc. While the airline group is based in Frankfurt, the individual airlines have a fair bit of autonomy in terms of their strategy.
Lufthansa Group CEO Carsten Spohr is looking to change that, in a project that’s called “Matrix Next Level” (lol?), which could be implemented as of early 2026. German publication Handelsblatt reports on an internal memo making its way around Lufthansa Group airlines, whereby Lufthansa lays out its plan to increasingly control decisions for the entire group from Frankfurt.
This is particularly controversial at SWISS, which is one of the group’s best performing airlines, as a fair amount of control of the airline has been left to management in Zurich. The intent is increasingly for strategic decision to be made by Lufthansa in Frankfurt, including for functions like route planning, sales, and loyalty. Meanwhile the inflight experience would be left within the control of the individual airlines. Spohr believes that this realignment is needed in order to improve profitability and customer satisfaction.
Obviously the individual airlines largely aren’t too jazzed about this concept. For example, a SWISS spokesperson has confirmed that “the Lufthansa Group is reviewing its organizational structure together with the Group airlines,” and that it’s examining “in which areas we can benefit even more from the synergies of a strong group”.
But a spokesperson also emphasized the importance for independence, saying “it is important for us to say that Swiss will remain a strong airline,” and that “in future, it should continue to be able to make its own decisions about its services.”

My take on Lufthansa Group’s management strategy shift
In theory, there’s nothing wrong with centralizing more management functions within an airline group, given the potential synergies. That being said, I have a few thoughts…
First of all, I’m always a little skeptical when the claimed motivation for something is to both increase profits and customer satisfaction. It’s rare that those two things go hand-in-hand, at least at an airline like Lufthansa.
Second of all, purely in terms of track record, I can’t help but be a little skeptical of centralizing more functions in Frankfurt. It honestly amazes me that we haven’t seen an overhaul of Lufthansa Group management, given the repeated shortcomings we’ve seen over the years.
Based on what record is it believed that decisions could be better made in Frankfurt than at other bases? For example, the reason that SWISS is having to install a 3,000-pound weight on its A330s is because of Lufthansa Group management, and not because of SWISS management.
For that matter, so many functions are already centralized with Lufthansa Group. This includes fleet planning (Lufthansa Group orders planes centrally), loyalty (Miles & More is one program for member airlines), and even route planning (so much planning happens as part of joint ventures, and there’s already a lot of coordination).
So I can’t help but but be a bit worried that if even more functions are controlled by Lufthansa, that just can’t be good for passengers. Anyway, we’ll see how this all plays out…

Bottom line
Lufthansa Group plans to centralize more management functions in Frankfurt as of early 2026. The idea is to leave less control with individual airlines of the group, like SWISS, and increasingly have decisions made at the airline group level.
In theory, there are no doubt synergies there, and I could see upside. The challenge is that it’s hard to have much faith in Lufthansa Group management, given its track record with so many things in recent years.
While the claim is that the goal is to increase profits and customer satisfaction, I would speculate that this development might help more with one of those than the other.
What do you make of Lufthansa Group’s management centralization plans?
Having an LHG management layer on top of each and every airline's individual management layer is simply inefficient. For example, for every airline flight ops, there is a Group flight ops structure sitting on top of it, and it is often not clear who really calls the shots.
In addition, consider the fact that it is hard to actually reduce headcount in Frankfurt due to labor laws.
All this makes the group very hard to...
Having an LHG management layer on top of each and every airline's individual management layer is simply inefficient. For example, for every airline flight ops, there is a Group flight ops structure sitting on top of it, and it is often not clear who really calls the shots.
In addition, consider the fact that it is hard to actually reduce headcount in Frankfurt due to labor laws.
All this makes the group very hard to maneuver. I believe that you either have to keep the airlines highly autonomous, with the downside of less economies of scale, or you have to consolidate much stronger, which seems to be happening now.
It's a tale as old as time, with mergers of anything. Take too much independence away and you end up with something so diluted and lacking the precise "x" people choose that brand for and it is all downhill from there until you have nothing left and impossible to save. Reminds me of design agencies that were moved and co-located within larger group building and no longer had the unique culture or creativity that made...
It's a tale as old as time, with mergers of anything. Take too much independence away and you end up with something so diluted and lacking the precise "x" people choose that brand for and it is all downhill from there until you have nothing left and impossible to save. Reminds me of design agencies that were moved and co-located within larger group building and no longer had the unique culture or creativity that made it successful in the first place, so this works across industries as a whole.
ITA is co-owned by the government of Italy, via the Ministry of Economy and Finance. So, good luck trying to cut managerial jobs in Rome to the benefit of FRA, or whatever...
Ben:
Just got off LH 855 from HEL-FRA, enroute to MLA this morning. Had read your two blogs on LH. Was chatting with senior. She heard rumors of new uniforms, but didn't know about Hugo Boss. She was surprised because LH does not spend money.
As for the one on centralization and better customer experience. She laughed and said it will ruin Swiss and Austrian. And just like Allegris.
But she did say that...
Ben:
Just got off LH 855 from HEL-FRA, enroute to MLA this morning. Had read your two blogs on LH. Was chatting with senior. She heard rumors of new uniforms, but didn't know about Hugo Boss. She was surprised because LH does not spend money.
As for the one on centralization and better customer experience. She laughed and said it will ruin Swiss and Austrian. And just like Allegris.
But she did say that it was LH 100th anny next year. Spohr will probably retire, and not be missed.
How about that for timely feedback.
Fake Noouz!
When you leave Germany and enter Switzerland, you immediately notice that everything is cleaner, better organized and more affluent. Twenty years ago the boundaries were much more blurred, but for a variety of reasons, Germany seems to have lost her way entirely.
The same is true of the LH Group carriers. Swiss isn't perfect, but it feels markedly more upscale than Lufthansa, and the operation in Zurich beats the pants off of Frankfurt and...
When you leave Germany and enter Switzerland, you immediately notice that everything is cleaner, better organized and more affluent. Twenty years ago the boundaries were much more blurred, but for a variety of reasons, Germany seems to have lost her way entirely.
The same is true of the LH Group carriers. Swiss isn't perfect, but it feels markedly more upscale than Lufthansa, and the operation in Zurich beats the pants off of Frankfurt and Munich. A lot of this is due to sound local management.
I live in Switzerland, and the Swiss people I've spoken with all look to Germany with pity, and as a cautionary tale of bureaucratic sludge and complacency. This story is getting a lot of press here and there's understandably a lot of concern.
The Swiss French says the same thing about Zurich.
Absolutely agree with you. Entering Switzerland from Germany or France, one immediately sees a difference. It is quite amazing, often taking trains, it is more so evident.
We've had our customer service problems with Lufthansa 10 years ago and we stopped using them. Their customer service was for German customers. We contacted the GM and explained that your airline is international, which means people from other countries fly on it, have problems, and expect...
Absolutely agree with you. Entering Switzerland from Germany or France, one immediately sees a difference. It is quite amazing, often taking trains, it is more so evident.
We've had our customer service problems with Lufthansa 10 years ago and we stopped using them. Their customer service was for German customers. We contacted the GM and explained that your airline is international, which means people from other countries fly on it, have problems, and expect decency when they call in to Lufthansa customer care. Well he wasn't thrilled and apparently what we read from Ben's column they haven't changed much.
By the way, the European countries are joining England, no not on Brexit, but on DEBT. So far only France has admitted it, but those of us on the ground here, know that Germany has the same problem.
I prefer the German ICE trains over anything SBB.
Well, if they can make all Allegris decisions in Germany, what can possibly go wrong with this plan for Swiss?
More efficient, better customer satisfaction. Is this out of the AA playbook? Perhaps it's past Spohr's retire by date.
One word foreshadows the insightful management.
ALLEGRIS
As for economy class, the seats are hard, spaced too closely together, service is impersonal and rushed, and the food…best not discussed in polite company.
What a Scheißdreck!
It’s only to reduce the duplication of services, cut jobs and save euros. Better customer service is Schweinewäsche!
At any other company the whole management team responsible for menu of seats mismanagement of allegris seats would have been sacked but politics, nice suits, and typical German Vetternwirtschaft keeps them in the position but this only lasts so long, see Deutsche Bahn. Just a thought!
As long as Vasu Raja stays in America, the Lufthansa Group has a fighting chance.
Centralization of strategic decisions is a dunderheaded idea. Spohr knows that, if not, he should not be chair.
Sphor, when will you start rebranding every airline to Lufthansa.
If staff is going to be cut it honestly makes sense to cut duplicative administration positions rather than, you know, the frontline employees that actually operate the flights. That being said, I can absolutely see how this would be bad for the individual airlines even if they do retain control over their inflight experience (for now). But who knows, maybe it also could cause such a backlash that a house-cleaning happens in the C-suite, but...
If staff is going to be cut it honestly makes sense to cut duplicative administration positions rather than, you know, the frontline employees that actually operate the flights. That being said, I can absolutely see how this would be bad for the individual airlines even if they do retain control over their inflight experience (for now). But who knows, maybe it also could cause such a backlash that a house-cleaning happens in the C-suite, but of course things would have to get worse before anything like that would make improvements.
At least in the business unites I have insights, Frankfurt's management is the most outdated, old-fashioned and non-innovative in the whole group. I'm seriously worried about Matrix Next Level - The only airline making losses in a good market environment should get more responsibilities in the group? The excessive self-confidence in Frankfurt is just (matrix) next level....
Fifteen years ago, the European carriers way ahead of the US carriers. Now I would avoid them. The lounge offerings are pathetic, the hard product is inferior compared to US carriers baring a handful of exceptions, the soft product at best is on par.
Disagree on hard product. There isn't a single US carrier that can beat Air France's business class on the new A350s. I've experienced them all - AF J is way ahead, especially in the bulkhead, which doesn't cost more than a standard J seat. AF's soft product is also far superior. I've yet to experience a Polaris, DeltaOne or American J FA who can discuss the merits of wine choices with me
The lounges maybe, for Delta and United
So "customer service" at the "lesser" LH-group carriers (Swiss and Austrian) will become like how a bull "services" a cow.
Good to know.
Their new motto will be, “Bend over, we’ll drive”.
Now, each subsidiary will be Spohr-nicated in the same manner with the same efficiency.
"Meanwhile the inflight experience would be left within the control of the individual airlines."
For now.
This is just the thin end of the wedge. Smart money is on five years tops before LH controls ever facet of the service offerings, timing of same, irregular ops policies, food budgets and menus, lounge requirements, all of it.
Almost definitely won't be better for customer experience. You already see how central planning has lead to a subpar first product being rolled out across LH + LX. Having said that - it's the obvious next move. Lufthansa Group is basically "Europe Airways" and I imagine it'll start to look increasingly like that. It's the obvious move. Essentially a continental carrier which has some localized branding/cultural elements (food, lounge style etc) within each "hub".
So massive layoffs are coming!
Consolidation of management makes a lot of sense of course, the way most European airline groups work is inefficient and expensive. Problem is that LHG is set on consolidating it into the least competent of its branches. Matters of product should be consolidated in Zürich/Vienna and FRA should only handle sales, admin etc.
All things being equal, this seems like a great idea and frankly long, long overdue.
LH Group is super fragmented and is wasting a lot of money on separate IT systems, duplicate functions in FRA, Vienna, Zurich etc. Personally, I'd rather have them spend more money on planes and cabin staff instead of seven different SAP contracts.
Would it be better if someone moderately competent was put in charge of customer experience? Sure. But in...
All things being equal, this seems like a great idea and frankly long, long overdue.
LH Group is super fragmented and is wasting a lot of money on separate IT systems, duplicate functions in FRA, Vienna, Zurich etc. Personally, I'd rather have them spend more money on planes and cabin staff instead of seven different SAP contracts.
Would it be better if someone moderately competent was put in charge of customer experience? Sure. But in the meantime, if they tackle bread and butter stuff like this, by all means go ahead.
Thank you, Carsten Spohr's mom.
LOL Carsten Spohr's mother would never write something that kind about his operation. People talk lol
BOHICA. "Enhancements" ahead.
Swiss HQ is not in Zurich but in Basel
and LHG officially in Cologne :-)
Did they really say it will be centralized in Frankfurt? Wouldn't it make more sense to centralize it in Zurich, so that the SWISS management can try to get LH-Group out of the fiasco it will be stuck in until Allegris can be replaced?
As far as I know, yes Revenue Management is being centralised (this project has been going on for years, by the way), but in Zurich, not Frankfurt
I thought for a sec today was Apr-1.
Customer satisfaction directed from LH's existing management?
OMG.
I worry about what this will mean for Austrian Airlines. They are by far my favourite Lufthansa Group airline with consistent service and a great soft product but this change might impact that.
I’m sure customer service and satisfaction was at the top of their minds when they came up with this plan. NOT!
Why one of the two? I think it's entirely likely that the move will harm both profits and customer satisfaction!
Your ignorance on matters aviation-related was at first amusing. Now it's simply cringe.
That's an insightful comment - I'm off to buy a few thousand shares in the Lufthansa Group!
Everyone should centralize and shrink bloated management ranks.
Most corporate managers are just money sucking leaches that could easily be reduced from 3 to 1.
the "children" are smarter than their parent
They should centralize in Zurich
Perfect example on micro level what happens when Switzerland accepts EU treaties.
Why does Carsten Spohr still have a job?
Because Spohr is another example of some people failing upwards as long as you look a certain way and have the right contacts.
Same question for Robert Isom.
They must all come from the Elon Musk school of leadership and compensation: worse your company does, the more centralized responsibility and compensation you get.
Sounds like a worse deal for passengers.