In February 2009 Lufthansa launched its first new airline operation outside of Germany with the Milan Malpensa-based Lufthansa Italia operation. Fast forward almost a year and 800,000 passengers later, head of Lufthansa Italia Heiki Birlenbach pronounces herself pleased with the passenger response to the new operation, but keen for the carrier to develop its own individual, Italian presence in the market.

"We learnt a lot of lessons and one of the lessons is you can't just copy and paste an airline and start somewhere else and believe everything will work out the way it does in your own home market," she explains. "This was one of the biggest learnings and out of this a lot of other things come up. If you go to a different market, even in Europe where things are quite similar, you are still in a very different market. So the way to manage this business in how you approach the market is highly individualised. You really need to think what are the things it makes sense to take over [from the parent company] and what are the things that you should do differently.

Birlenbach, Lufthansa Italia

Birlenbach: "We would really like to offer these Linate-Rome services from our side for those short city-to-city connections."

"We as Lufthansa cannot just say we are Italian. It would not be authentic. So it is more of a combination, being a little bit Italian by the onboard experience with Italian speaking staff, food onboard and really look at the detail to make sure it is typical Italian. But it will still be Lufthansa and present the values of Lufthansa."

This in part explains why the carrier is keen to secure its Italian air operator's certificate - it has been operating under the Lufthansa AOC since its launch. "We are in intense discussions with ENAC on a daily basis and we believe the AOC can get granted this year."

It will be a significant step as the carrier seeks to position itself in the market in its own right as an Italian carrier, differentiating itself from its parent. "Customers that have experienced Lufthansa Italia have an understanding and they realise the little differences," she says, for example pointing to the newly launched Lufthansa Italia all you can fly initiatives - a pricing package not available at Lufthansa. "[But] With the general public so far I still don't think we have succeeded in making it clear to everybody that there is a difference between Lufthansa and Lufthansa Italia. So this is why we are working on a communications concept right now to have a more dedicated positioning of Lufthansa Italia."

The carrier currently operates to seven international and three domestic destinations. It will expand this from March having just announced plans to add flights to Stockholm and Warsaw, and domestic connections to Palermo and Olbia. But it has conceded defeat, at least from Malpensa, in its efforts to compete on the key Milan-Rome link against the Alitalia-Air One monopoly currently in place linking Milan's downtown Linate airport with Fiumicino. It is suspending its Malpensa-Rome connection from 16 February and will instead press for Linate route rights.

"We would really like to offer these Linate-Rome services from our side since for those short city-to-city connections, it is difficult to sell that out of Malpensa," says Birlenbach. "So we do everything we can in terms of talking to the politicians locally, checking out the possibilities via the European Commission, to see if there are options for us to open the window to fly those routes."

Lufthansa launched the Italian carrier launched to take advantage of a gap left after the new Alitalia's decision to scale back its hub presence at Malpensa, a move which sees Lufthansa Italia and UK budget carrier easyJet as the largest operators at Malpensa.

Birlenbach stresses the potential for the Milan market and Lombardy region, though acknowledges the carrier has - like virtually all carriers - been impacted by the economic crisis. "Of course it affected us in terms of passenger figures. If I look at the business plan we had in mind, which was before the crisis even started, of course it is a lot different nowadays, but they are a lot different in the overall airline industry. There was a decision to be made whether to wait or to start anyway, and Lufthansa decided to start anyway because there is only a certain point you get to start.

"I still believe it was a good thing to have started in 2009 despite the difficult times, also in terms of positioning ourselves and it really shows our commitment to the market. How could you better explain that to the region than invest in times like these?"

Read more on how Alitalia-Air One relaunched here

Source: Airline Business

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