The German competition authorities prohibit Lufthansa from terminating its cooperation with Condor. Passengers of the holiday airline can continue to use Lufthansa feeder flights. Condor also receives additional benefits. But Lufthansa wants to fight back.
The Bundeskartellamt has banned Germany’s largest airline from ending long-term cooperation agreements with its competitor until further notice. “On this basis, Condor passengers from all over Europe can continue to use the feeder flights operated by Lufthansa and its airlines with a combined ticket for the long-haul Condor flight,” explains Andreas Mundt, president of the Authority in a statement. German for competition. Thursday (September 1).
Following the intervention of the Cartel Office, Lufthansa suspended the original termination of the contractual relationship several times until October 31st. “We have come to the conclusion that Condor has an antitrust claim against Lufthansa for access to feeder flights beyond this time,” Mundt said.
Slots largely allocated to Lufthansa
The Cartel Office said it has no doubts that Lufthansa is the only airline that can offer a comprehensive route network with flights from Europe to central German hubs in Frankfurt, Munich and Düsseldorf. “According to the investigations carried out, this location cannot be attacked either,” he writes. No other airline has such a dense feeder network.
On the other hand, according to the competition authorities, Condor will not be able to offer its long-haul passengers an equally smooth journey in the foreseeable future by offering a trip to the airport by train or bus. “Even the development of our feeder network – if it were possible to manage it economically for a relatively small airline – is currently not foreseeable, given the take-off and landing rights at German hubs that have largely been allocated to Lufthansa.”
Lufthansa has special obligations
Due to its dominant market position in the supply of a feeder network, Lufthansa is subject to antitrust abuse scrutiny and therefore has special obligations towards other market participants. It should also be noted that Lufthansa is increasingly in direct competition with Condor on long-haul tourist routes with Eurowings Discover. The group does not want to encourage foreign competition through access to its power network. “For the resource-strong Lufthansa, however, there are numerous means of effective competition in terms of performance with Condor, which it also uses,” he says.
According to the Bundeskartellamt, adequate performance and price competition are only possible if Condor can benefit from the agreements with Lufthansa. “Otherwise, Condor – unlike its competitors – would not be able to offer a continuous long-haul connection from the departure airport to the destination airport with checked baggage all the time and full travel protection in the event of a delay or flight cancellation”.
Condor receives additional benefits
According to the Cartels Office, if Condor were to break away from the customer group of travelers who want a feeder flight, this would have serious economic consequences for the company and for the competition. “Up to 30-40 percent of long-haul passengers use a connecting flight, depending on the season, according to the survey.” With nearly 80 transfer connections to tourist destinations, Lufthansa could gain significant competitive advantages as a current or potential competitor, and in some cases even a unique position. Choices for travelers and tour operators would be limited.
But that is not all. “For the access request to be effectively implemented, the mere continuation of previous contracts is not enough,” says the Cartels Office. The decision will therefore allow Condor to access more booking classes than before. Furthermore, the holiday airline will always be able to reserve seats as long as the feeder flights still have significant free capacity. “Furthermore, under antitrust law, Lufthansa is not allowed to restrict bookings and price controls for Condor by specification for the booking classes that Condor can offer its passengers on long-haul routes,” it said.
Lufthansa can file a complaint
The decision is not limited in time, but contains a right of revocation. Should the market and competitive conditions change, for example if Lufthansa loses its dominant position, the Federal Cartel Office can, upon request, examine whether there are alternatives for Condor to delivery via the Lufthansa network. “It can be assumed that both companies will continuously check the corresponding scope for this,” predicts the Cartel Office.
The decision is not yet final. Lufthansa has the option to file a complaint against this within one month, which would then be decided by the higher regional court in Düsseldorf. And that’s what the company will do. One does not share the Federal Cartel Office’s view and “will send the decision to a judicial review,” a Lufthansa spokeswoman said. The group speaks, among other things, of a “completely atypical adjustment of the sector” of the cooperation agreements by the Cartel Office.
Teckentrup feels confirmed
Condor boss Ralf Teckentrup says: “Today’s decision by the Federal Cartel Office confirms our understanding that Condor has a legitimate right to power flights through the Lufthansa Group because the group would otherwise abuse its market power.” For Condor passengers this means «unlimited, long-term planning security with access to convenient transfer connections from now on».
