Air Berlin Working On Restructuring

Air Berlin, once a promising low-cost carrier with massive aspirations, has announced a major restructuring of the airline.

Air Berlin

Air Berlin focusing on business market

Air Berlin has been in financial problems for quite some time now.  Between 2007 and 2012, the airline continued expansion and partnerships. It now seems that Air Berlin’s expansion was one without a clear vision.

Also in Germany airlines such as Ryanair started to establish bases.  The German airline at that time was too busy integrating acquisitions into the airline and it seems that benefits from the economies of scale diminished. The airline was left with acquisitions that did not really pay off in terms of passengers and revenues.

The airline cancelled its long haul orders and scrapped part of its long haul network. Etihad took a 29% stake in the loss making company and the company has been reforming ever since.

The newest reorganization will turn the second biggest airline of Germany into an airline with 75 aircraft focused on the business market, 1200 positions or 14% of the current staff positions will be eliminated. 40 aircraft will be wet-leased by competitor Lufthansa, which is primarily using the aircraft to grow its low-cost carrier Eurowings.

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