Lufthansa Interested In Condor Takeover

Filed Under: Lufthansa, Other Airlines

If Lufthansa has their way, they’ll soon own German leisure airline Condor… again.

A brief history of Condor

Condor is a German leisure airline founded in 1955. The airline operates a fleet of 41 planes, including A320s, 757s, and 767s. As you’d expect, they fly to vacation destinations around the world, including in Europe, Africa, and North America.

Condor 767

The airline has quite an interesting history. Lufthansa was a shareholder in Condor from the time they were founded in 1955. While the airline has gone through a lot of adjustments in its business model over the years, in 2000 Lufthansa started selling their shares in Condor to Thomas Cook.

Thomas Cook is a UK travel company that has airlines and hotels, though primarily they’re a travel agency.

So between 2000 and 2007, Lufthansa sold all of their shares in Condor to Thomas Cook.

While at this point Lufthansa has no ownership stake in Condor, the two airlines continue to partner together. The two airlines interline, Condor uses Miles & More as their frequent flyer program, and premium Condor passengers get access to Lufthansa lounges.

Personally I also have quite a bit of history with Condor. Growing up we’d fly them every year from Tampa to Frankfurt, as they were the only airline to fly nonstop. This was back in the days when they had a smoking section on planes, and that’s really what got me into miles & points. I figured there had to be a better way to get to Germany than in the smoking section of a Condor 767. šŸ˜‰

Condor 767 economy cabin

Thomas Cook has been looking to sell Condor

While Thomas Cook’s airlines have been performing pretty well, the company has still been looking to sell them. Why? Thomas Cook as a whole is losing quite a bit of money, due to their vacation division — for example, in 2018 the Thomas Cook airlines reported an operating profit of 129 million GBP, while the company reported an opening loss of 60 million GBP during the first quarter of their fiscal year.

As the Thomas Cook CEO described it:

“We recognize that we need greater financial flexibility and resources to accelerate the execution of our strategy of differentiation: to invest in strengthening our own-brand hotel portfolio, further digitizing our sales channels and driving greater efficiencies across the business.”

Lufthansa is interested in Condor

Today was the deadline for potential investors to express interest in Condor, and Lufthansa CEO Carsten Spohr has said that the company intends to make a bid for Condor:

“We decided yesterday in the meeting of the management board to bid for all of Condor with the option to be able to extend this (bid) to all Thomas Cook airlines.”

Spohr recognizes there will be further consolidation in the airline industry in Europe, and has stated repeatedly that he expects Lufthansa Group to be a part of that.

What could Lufthansa do with Condor?

Condor is an interesting airline. On the one hand, they have routes that do quite well, and ones that complement Lufthansa’s route network pretty well. On the other hand, the airline has an outdated fleet.

Their long haul fleet consists exclusively of 767s that average over 23 years old, and soon enough these planes will need to be replaced (and this is something that Condor doesn’t have a plan for as of now).


Condor 767 business class cabin

So I imagine partly Lufthansa’s motivation is to keep Condor out of the hands of another airline. While I’m not saying that IAG or Air France-KLM would necessarily be interested, Lufthansa is very protective of their German market share, as we’ve seen repeatedly as other airlines try to set up bases there.

If Lufthansa were to take over Condor, I could either see them keeping Condor independent, or folding them into their Eurowings brand, which is their low cost carrier division.

Eurowings A330

Bottom line

Reports suggest that both Lufthansa and Indigo Partners (which was initially interested in a WOW Air takeover) are both interested in a Condor takeover, so this will be an interesting situation to watch over the coming days.

I could definitely see Lufthansa taking over Condor, and if that happens, I’m curious if they’d maintain it as an independent brand, or fold it into Eurowings.

What do you make of Lufthansa potentially taking over Condor?

Comments

  1. Condor is a good fit for Lufthansa. Nobody is asking me but if it was me I’d buy them, keep the important routes and landing slots, secure better partner relationships with Alaska and Thomas Cook. Then I’d roll aging Lufthansa aircraft into this division to keep it fresher while updating Lufthansa mainline aircraft. I’d also keep the brand separate to shield Lufthansa from potential bad financials if it goes wrong and also so that I could sell it off if it didn’t work. I might also make some routes a bit more seasonal as needed.

  2. The warm wet towels they would distribute in the morning, laden with camphor, were a great way to wake-up. I traveled with them many times.

  3. “As youā€™d expect, they fly to vacation destinations around the world”. Hummm!!!!! If that is the case I wonder why they have a daily flight to MSP. Although Minneapolis is probably the most underrated city in the US and there is a lot to do as far as outdoor activities I would not classify it as a vacation destination. I always wondered why they fly everyday from Minneapolis to Frankfurt. BTW, I had friends that took that flight and they had no complaints at all.

  4. Yikes… like you, the Condor flight from Halifax to Frankfurt is more important to Nova Scotia than it should be because it’s a direct flight to the continent. For someone like me who grabs Alaska miles for that 25k low surcharge flight, the prospect of Luft’s high surhcarges is alarming…

  5. Seattle has year round service to Frankfurt on both Lufthansa and Condor. Last summer we had seasonal service on Thomas Cook to Manchester and Eurowings to Cologne, though the latter isnā€™t back this year. I foresee $500 one way flights in premium class disappearing with this potential consolidation, which would be a shame.

  6. I wonder if we might see Eurowings folded into Condor which is iconically German in a way that Germanwings was becoming and Eurowings has never quite made it in the same way.

    It would be even more interesting to see Lufthansa take over the whole of the Thomas Cook operation, that could only be a good thing.

  7. Lufthansa, Thomas Cook, and Condor all fly to Orlando. That would be interesting to see….

  8. Condor’s flights between Frankfurt and Baltimore seem to be doing very well for the airline; however, I find the route slightly odd because, as pointed out above about Minneapolis-St. Paul, Baltimore is not exactly thought of as the most tourist-friendly city on the planet. This goes for other U.S.-bound flights operated by Condor, such as Anchorage, Fairbanks, and Pittsburgh. But their strategy seems to be working, at least in Baltimore. I suspect the reason for this is that, with the collapse of WOW air and cessation of seasonal flights by Icelandair, there are now two ways to get to Europe: British Airways and Condor. They do not have much competition, which is a smart move on their part.

    As for the potential Lufthansa takeover, I would hope that they would keep the brand of Condor and possibly use it as more of a leisure airline ā€” think Edelweiss, SunExpress, or the former Monarch Airlines ā€” as opposed to the more business travel-focused operations Lufthansa runs. Their aging 767s will certainly present a major issue to the airline regardless of their ownership status.

    However, it seems more likely to me that they merge Condor into Eurowings. The reason that I forsee this is that, for many moons now, Lufthansa has been trying to buy out and merge any airline they can into their Eurowings brand. Their current target is Belgian flag carrier Brussels Airlines and, in the past, they attempted to merge now-defunct Air Berlin into their then-budding subsidiary.

    Overall, it is entirely up to Lufthansa what to do should they acquire Condor, but my fingers are crossed for Condor to survive.

  9. Sounds like a good match for Lufthansa to take over Condor and merge with Eurowings. Then they can go after the other small European long haul leisure airline in the making…. Air Italy!!

  10. I have a trip planned for end of July with Condor from MSP to FRA in business class and with all this talk of selling Condor makes me nervous. I’m scared to end up in a Wow Air situation and either missing my flight out or worse yet being stranded. Then having to pay a butt load to either go to Germany last minute or try to get home. Anyone think this could happen?

  11. @Kinn,

    The Baltimore flight flies out of Baltimore Washington International Airport (actually it has an even longer name) and is fairly convenient to both Baltimore and Washington. And is much easier to get to/from than Dulles for many people.

    I also think Condor flies out of Phoenix Sky Harbor Airport. Not sure how frequently.

  12. I just hope that Condor stays as an AS partner. It’s the one “easy” way to get from the west coast to Germany in J with points.

  13. @Kinn I’ve flown the BWI-FRA flight on Condor numerous times with my family. Most of the other travelers appeared to be families, and I’d bet most are from the DC area. For us we could get Premium Economy to Europe on Condor for the price of regular economy on Lufthansa from Dulles. I think families in DC are willing to drive to BWI to save $100+ per ticket compared to Dulles, as it really adds up if you’re traveling as a whole family.

  14. @Richard that was exactly my first thought. If german authorities already denied LHs acquisition of Niki a few years back, I can’t imagine it being any different this time around. I honestly hope someone else takes over Condor, otherwise it will be gg for their great fares.

  15. LH is going to find a way to take over Condor. They are more interested in Condor’s long haul routes and i see competition authorities maybe allowing that. No other airline would fly those long haul routes anyway except maybe those Florida routes.
    And Eurowings is moving to Frankfurt and will be competing head to head with Condor on some routes.

    LH will most certainly keep the Condor brand as it’s a very well known and trusted airline in the german speaking area. Thomas Cook changed the name to ‘Thomas Cook airlines’ but had to revert to the Condor after while as brand recognition went low. LH will probably make Condor as part of the Eurowings group but keep the brand. And with the german government right behind LH, i assume LH will just sacrifice some short haul routes.

    You have to wonder why no competitor (like Norwegian or Level) has set shop in Germany even after Air Berlin’s demise. Lufthansa is untouchable.

  16. @rich @Jim

    I think my point was slightly misinterpreted. I do understand the influx of passengers resulting from BWI’s decently close proximity to Washington DC.

    My point was moreso that, because of this proximity, Lufthansa and Condor are in essentially direct competition with each other, despite the fact that Condor flies to an airport often referred to as serving Baltimore and Lufthansa Washington DC. From central DC, I have found Dulles and BWI to be roughly equidistant when traffic is factored in. As such, I find the relative success of Condor’s flight interesting. Even with the price difference, Lufthansa is a juggernaut out of Frankfurt, one that an airline like Condor would not typically be able to overcome.

    Perhaps I am missing a point made by either of you; if so, I apologize.

  17. @Sam because LH is really *really* defensive. If you think about it Germany’s main airports (MUC and FRA) near full capacity, much of which is controlled by the LH group. They won’t let anyone set a hub either of these.

  18. @Kinn I think they are different markets in some ways. BWI is a good place to scoop up family and price-sensitive travelers. LH would not generally serve BWI — too low-yielding given their costs. Heck, twice when I flew BWI-FRA on Condor, they did not have a plane with business class, just prem eco and eco (plane shortage, as I understand it).

    Look at the rest of the traffic from BWI — the majority of traffic is on Southwest, which also focuses on family and leisure travelers. That’s the target market for most of BWI’s traffic I’d say. My friends who live in Baltimore usually come to IAD when they need to fly internationally, unless the BA BWI-LHR flight will work for them.

    As for LH being a juggernaut out of FRA, indeed they are which is why every time I’ve flown BWI-FRA on Condor, I connected to an LH onward flight out of FRA, all sold as one Condor ticket. So Condor is using LH’s FRA network to their benefit.

  19. Thomas Cook Airlines Belgium is already fully integrated in Brussels Airlines. So in Belgium Lufthansa decided to discontinue the Thomas Cook brand.

  20. So Thomas Cook thinks that they’ll do better financially by getting rid of the profitable part of the company? Hmm, there’s something wrong with this logic.

  21. IMHO, LH will probably use Condor as the low cost German option for cities that have TATL demand but not enough to support a premium heavy LH aircraft or a dense Eurowings A330. I envision that LH will use and expand Condor to serve smaller mid-size markets like BNA, MCI, STL RDU etc as Condor appears to have found a niche beyond tourism since they serve PIT, MSP, BWI etc.

    As for long haul fleet replacement the 797 would be the perfect aircraft for most of their network but I suppose LH could add a few older A330’s for their more popular destinations.

  22. I think iag will make a bid for Thomas Cook in the UK in order to stop Lufthansa from gaining a foothold in the UK. Particularly at London Gatwick with BA looking to become the number one airline at Gatwick once again the Gatwick slots will be extremely attractive to iag.

    The only way I see iag ignoring Thomas Cook is if they are still interested in Norwegian and if iag has Thomas Cook’s Gatwick slots there is no way the UK competition authorities would allow them to buy Norwegian.

  23. I have enjoyed Condor flights (J) on a number of occasions over the last few years with better tasting meals than on CX F, Swiss and Qatar.

    I have flown from San Diego, Calgary and Vancouver.

    Tilt lie flats are comfortable for me and I really appreciate the value for money.

    Hope they continue to operate with the same business model.

  24. wondering if this would result in a loss of a partner for Alaska, or a gain of a much greater partner.

  25. It is obvious that Lufthansa would buy them, it is rther the question if they will be allowed to. This is of course the reason why it has not happened yet (and why they sold the shares in the first place). Slim chances at the moment, especially after the stunt they pulled with Air Berlin.

  26. Lufthansa desperately requires competition.

    Then again, I guess they could buy Condor, promise that by 2037 they will have fitted anti-gravity nurture-pods for each J class passenger, and a new Star Trek-style teleport device for F, enabling Skytrax immediately to designate Condor the world’s first 10* carrier.

  27. @Ben Holz I have to disagree. MUC is constantly expanding T2 (Star Alliance Terminal), but theyā€™re putting around 1billion $ into the expansion of T1, which is exclusively used by non Star Alliance airlines.

  28. I agree, MSP is underrated

    But people are thinking of it backwards
    Europe (Not MSP) is the vacation destination

    Condor serves MSP to Europe.
    Lufthansa does not serve MSP

    So Minnesotans can get to Europe using Frankfurt as the gateway, connecting on Lufthansa

    The only carriers serving MSP to Europe off the top of my head are Delta, Air France, KLM, (all expensive) Iceland Air, Condor, and soon Aer Lingus

    Condor serves the lower cost option to Europe that competes with Iceland Air

    I hope Lufthansa doesnā€™t ruin Condor

  29. I just looked for a cheap flight from DC to WAW. Condor came out as cheapest from BWI to FRA to WAW. I heard of the name before, but reviews of Condor airlines is brutal. The flight seems to be operated by Airtank?

    Anyone done this route before with Condor? Also anyone used the flex option for cancellation or rebooking?

  30. @Milan, yes but I wouldnt say MUCs current expansions are enough to allow a new airline to open up a base. T2 is the one that has experienced the most expansion (thanks to the satellite terminal mainly) and as you said T2 is pretty much *A only (and 40% of it is actually owned by LH), so thats ruled out.

    Then you got T1 which yes, will be renovated, but the expansion is anything but significant. The ā€œnewā€ T1 will handle 12 aircraft simultaneously at most, which isnt far off the current capacity.

    However, in my opinion what it mainly boils down to is the lack of that third runway. MUC has been trying to get it built for more than 10 years and still no success (either government unapproval or lack of votes during the referendum.

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