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Thursday, May 5, 2011

Lufthansa Boosting Capacity In Asia-Pacific

Lufthansa plans to see double-digit growth in capacity this year into the Asia-Pacific region, with the exception of Japan.
The German flag carrier will launch no new destinations into the region this year, but will achieve a 14-15% capacity increase by operating larger aircraft, Uwe Mueller, head of sales for home markets (Germany, Switzerland and Austria), told Aviation Week May 4 in Singapore at a press briefing to announce the appointment of Steffen Harbarth as Lufthansa VP of Asia-Pacific, based in Singapore. Mueller is based in Frankfurt, but previously had the Singapore job.
Mueller says the growth figure excludes Japan, a market that accounts for 20-25% of Lufthansa’s Asia-Pacific passenger revenues. Lufthansa cut capacity to Japan following the March 11 earthquake and tsunami. It still maintained its network there and refrained from slashing ticket prices, but it did cut capacity by switching to smaller aircraft, says Mueller.
The Japanese market has since rebounded, and on April 23, Lufthansa’s capacity to Japan returned to pre-crisis levels, says Mueller, who cites the fact that Lufthansa is now operating Airbus A380s again to some Japanese destinations. “Golden Week holidays are now on in Japan, so now every Japanese person is traveling,” says Mueller. He says Lufthansa’s passenger traffic between Europe and Japan mostly comprises Japanese business people and tourists. There is relatively little traffic in terms of Europeans traveling to Japan, he adds.
While Lufthansa’s team in Asia-Pacific is focused on increasing capacity on existing routes, next year may be a different story.
In October and November of this year, a fourth runway will open at Lufthansa’s base in Frankfurt, creating additional slots. Lufthansa’s board recently approved plans to add 155 new aircraft over the coming years at a cost of €13 billion ($20 billion), and it has earmarked another €3 billion for refurbishment of some existing aircraft and service enhancements, such as new lounges, says Frank Puettmann, head of corporate communications, Asia-Pacific.
Harbarth says much of the new capacity destined for Asia this year will be in China and India. He also says Lufthansa wants to launch flights next year to more cities in China but did not name them.

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