The Star Alliance is poised to make deeper inroads into the USA with along-term strategic alliance between Lufthansa and US Airways that should lead to eventual bilateral antitrust immunity as well as the US carrier becoming a full Star member.
Lufthansa chairman Juergen Weber says that flights could begin in October linking the five hubs of the two carriers - Frankfurt and Munich in Germany and Philadelphia, Charlotte and Pittsburgh in the USA.
The Lufthansa agreement is in addition to a seven-month-old domestic codeshare that US Airways is implementing with United Airlines, but will be consummated far more quickly, says US Airways chief executive David Siegel. The arrangement "will be cash-flow positive within months", he adds. Weber said that some information technology issues remain and US regulatory approval is needed, but told reporters that both are surmountable even though implementation will cost "hundreds of thousands to millions of dollars" over the next several months.
Weber also stresses that both Lufthansa and United support the full entry of US Airways into Star, and Weber adds that Star executives could formally approve the entry before the summer.
Siegel is slightly more reserved about Star entry, saying: "We believe we're a perfect partner for Star, but we're not going to be presumptuous that we're going to get in."
Weber says: "Together, US Airways, United, and Lufthansa will build up a very strong triangle over the North Atlantic." He adds: "People talk about consolidation. Well, we're doing something about it. Here is an important step toward consolidation."
Although Lufthansa and US Airways would not initially seek antitrust immunity, Siegel says that "you can expect that we would" eventually, since competing alliances enjoy the pricing powers of immunity. Separately, the Department of Transportation regulators have approved antitrust immunity between United and its Star ally Asiana of South Korea.
As Star membership beckoned, US Airways was preparing to restore flights from Pittsburgh to its partner's Frankfurt hub. The carrier suspended operations in April, citing its commitment to provide aircraft to the US Civil Reserve Air Fleet. Service to London Gatwick from Pittsburgh will also be resumed.
Source: Airline Business
