It looks like Europe will be losing yet another airline tomorrow. In mid-August airberlin filed for insolvency, after Etihad essentially cut them off. In late October airberlin ceased all operations, so it was just over two months from when they filed for insolvency until they went out of business.
Continue reading: Niki (Austrian Airberlin Subsidiary) Is Going Out Of Business Tomorrow
Share your questions, experiences, and thoughts below.
Niki Lauda, my all time favorite F1 driver. Sportsmanship, passion and talent...
So the EU can stop LH from buying and divesting in Niki and saving the airline and jobs? But now LH is free to add all of the capacity that it wants to in Austria? Wow! So bascially the EU is just useless and hasn't got a clue about business or competition. Now wonder people want to withdraw from the EU.
This will give LH a stranglehold on traffic in Germany and Austria as well as other places.
@Endre - I believe Nika Lauda sold his interests in this airline quite a while ago. He is known to be a very shrewd businessman, so it's sad to see something that he created disappear.
According to Austrian media reports Niki Lauda, the founder and former majority shareholder, is interested in buying the airline out of insolvency. Would be great for the employees and it also has quite good chances in making a profit as Niki has always been the only part of Airberlin that actually made money.
That's exactly what LH management and the German government planned for, a super monopoly for LH. The LH bid for Niki was very clearly breaking EU law, but it helped to turn down other bidders, including IAG and Thomas Cook.
At this late stage, the other bidders are no longer interested (understandably) and LH can more cheaply aquire 20 more planes and staff without the airline.
In most countries, the insolvency administrator would be prosecuted for such a manoeuvre, but rest assured that the German government, which is part of the plot, will protect him. That's how corruption works in Germany ...
With Air Berlin and Niki gone, at least Berlin-Tegel will become less congested.
@Marshall, that seems like a gross oversimplification. Competition laws are there for a reason and it's hard to argue that the situation would be any different if Niki were to survive as a Lufthansa subsidiary. It really would make no difference to the flying public.
Those routes will be replaced one way or another. Nothing is keeping easyJet or others from jumping in on the vacant market capacity and competing.
I'm a EU Competition lawyer, though I don't do merger filings. Interesting to note that the undertakings did not raise a 'failing firm defence'. My guess is that they did not pass the very strict legal test involved. See https://www.oxera.com/Latest-Thinking/Agenda/2014/The-failing-firm-defence-a-get-out-of-jail-free.aspx
Let me get this straight. The "experts" on here GENUINELY believe that the following are the exact same thing with regards to the amount of competition:
Scenario 1 - Nikki becomes Lufthansa.
Scenario 2 - Nikki collapses and any airline is now free to move in and compete over newly vacant routes.
The mind boggles...
Don't forget about the 150 million Euro loan from the federal republic of Germany to airberlin, which was meant to be payed by Nikis earnings. The government is indeed paying on top of this (plus all the support for unployment etc)
@callum I think what Lucky, and others, are getting at, is that LH is perfectly positioned to move in on that network. It's not like Norwegian (as an example of 'any airline') could just create that network in a month or so. First mover here really has an advantage.
This is weird. I had a ticket from Gran Canaria to Berlin on Eurowings in February that it got cancelled Yesterday “due to operational reasons” there was another flight with Nikki that they were still selling as of yesterday now the only direct flight is on Ryan Air at 7:00 am. Other days have 5 or 6 direct flights with different airlines but the day of my flight only has one I don’t understand why they cancelled the Eurowings flight.