German flag carrier Lufthansa has called for a global licensing authority with the ability to rule on airline alliances and competitive structures.
"The European Union [EU] is investigating all transatlantic alliances and assures us that a decision will be taken simultaneously to avoid distorting competition by proceeding against one alliance before another," says the chairman and chief executive of the Lufthansa Group, Jürgen Weber. He is fearful that after the decision by rivals American Airlines and British Airways to hold back on a fully blown codesharing alliance, Lufthansa's Star Alliance will be singled out for punitive approval conditions by the European Commission.
"But this discord reveals a marked lack of convergence in regulation procedures both in Europe and the USA. It demonstrates that an alliance can be labelled as 'limiting competition' on this side of the Atlantic and yet approved as 'competition-friendly' after scrutiny in the USA."
Because of this dichotomy and the global significance of the issue, "we need a world licensing authority", he says.
Weber has hit out at the EU's failings in establishing and running region's air traffic control agency Eurocontrol. "The fact that air traffic control was to blame for about a third of delays in 1998 can no longer be put up with," Weber says. "The inability of the EU states to reach agreement on common ATC standards is outrageous. Burning 25,000t of kerosene when our aircraft are in holding patterns is a senseless waste of resources."
Weber should have some reasons to be cheerful, however. Lufthansa recorded strong full year and first quarter results with group turnover up almost 5% to DM22.65 billion ($13 billion) for the full year, while profits rose 42% to DM 2.48 billion.
Passenger revenues rose by close to 6%, due mainly to a steep rise in European and transatlantic traffic. Load factors were up by five points, nearing 74%, with North Atlantic loads as high as 81%, while capacity cutbacks on Asian routes boosted seat occupancy rates.
Lufthansa's non-flying businesses also performed well, with maintenance arm, Lufthansa Technik, increasing revenue by 7.8%.
Source: Airline Business
