It was only last week we received word that The Polish Aviation Group (known as PGL, and owner of LOT Polish Airlines), would be buying German carrier, Condor. The airline, which was owned by Thomas Cook, survived the travel company’s collapse in September last year. The situation for Condor continues to develop as information obtained by Südeutsche Zeitung indicates that Lufthansa is on the verge of abandoning its longstanding cooperation with its former subsidiary airline.
The current arrangement
Currently, the relationship consists of a contract that feeds Lufthansa traffic to long-distance Condor routes in Frankfurt as well as the Condor’s participation in the Lufthansa frequent flyer program Miles & More.
Lufthansa has been bringing passengers on Condor’s behalf to Frankfurt for years now. This allows them to more easily switch to the long-haul aircraft of the leisure carrier. Without these feeder services, Condor will need to find another way to fill up its aircraft.
As for the Miles & More program, Condor’s participation allows it to share the same loyalty program as Lufthansa – as well as Austrian, Brussels Airlines, SWISS, and strangely enough, LOT Polish Airlines among many others. The program also cooperates with many other Star Alliance member airlines.
Possible review by the EU Commission
PGL appears to have some lofty plans for growth- plans that Lufthansa would rather not support indirectly through its cooperation with Condor. Sources indicate that one course of action Lufthansa is taking is to ask the European Commission to investigate the possibility of “unlawful state aid”.
Airliners.de reports that the Polish government financed LOT in 2014, integrating it into other state-owned PGL holding companies four years later. The low-cost carrier Wizz Air is also calling for the process to be checked by the EU according to Südeutsche Zeitung. In fact, Wizz Air’s chief, Jószef Váradi, said himself that “the [Polish] government is doing everything it can to support LOT”.
The European Commission approved a capital increase of 200 million euros in 2014, which the Polish state followed-through with. This was done to prevent the collapse of its national carrier, LOT. However, at the heart of the controversy are EU rules, which say the state can only help a company once within ten years. But in 2018, Poland founded the state holding company PGL with a capital investment of approximately 600 million euros.
A severing of relations with Lufthansa would indeed be difficult for Condor. Setting up a new loyalty program requires intense efforts, and a program without many partner airlines would be a distinct drawback for Condor. While Miles & More is managed as a company of its own, it is still a 100% subsidiary of Deutsche Lufthansa AG.
We asked Lufthansa to comment on these reports and this was their response:
“We will never [comment] on media speculations. The Lufthansa Group has successfully expanded its tourism oriented schedule in recent months. We will consistently continue along this path, regardless of who owns Condor. Lufthansa’s dense feeder network to the Frankfurt and Munich hubs allows passengers to reach the most beautiful places in the world in comfort. In the first three months since the start of Eurowings’ long-haul leisure flights at the Frankfurt and Munich hubs, we have already welcomed around 130,000 passengers on board these flights.” -Lufthansa spokesperson
If you’ve flown Condor before, was Lufthansa’s cooperation a factor in your journey? Let us know if the relationship matters to you by leaving a comment.