Same day as XL Airlines goes bust and SAS (Scandinavian Airlines) confirms it's in talks with Lufthansa about the latter buying them. Apparently the two companies together would be about the same size as KLM/Air France.
I don't know if I like this. My experience with Lufthansa hasn't been that great and I just like the thought of travelling on a Scandinavian airline.
In any case, there's really been a TON of info in the airline sector this year. Mostly of the bankruptcy, buyout nature. Seems like a tough business to be in!!
[ Edit: Added some reference articles... ]
Yep, tough business indeed. Still am surprised that certain budget airlines are surviving these years, although they must have a hard time as well to make a profit. Especially the intercontinental budget airlines have difficulties, and Oasis Hongkong going bust is prove of that of course.
Let's all hope we travellers will have better connections and services because of these fusions..or buyouts
What will this mean for the prices?
To be honest, budget airlines appear to be struggling, though RyanAir and EasyJet continue to open new roots.
But even they are no longer cheap...
...RyanAir have stopped quoting prices including taxes and fee's, so you get a nasty shock when you actually get the full price. They have also gone up dramatically in prices.
The problem is that giants like Lufthansa and Air France become all the more powerful and the public loses due to the decrease in competition. Who's best guess for Alitalia?
Hopefully Lufthansa will do with SAS as they did with Swiss (and Air France did with KLM), and keep the SAS name alive and therefore the Scandinavian identity as well.
I know that I would now be reluctant to fly SAS with LH in charge, but if travel involves Scandinavia, one has little choice!
I would imagine most older Scandinavians would outraged by the news of a takeover by a German company. What are the papers saying, Sam?
Could Iberia be next (with a British takeover)??? http://tinyurl.com/5nzpwa
[ Edit: Edited on Sep 15, 2008, at 10:50 AM by Daawgon ]
LH has purchased a 45% stake in Brussels Airlines with an option to purchase the remaining 55% by 2011 for a price not to exceed €250 million.
Personally, I think all this consolidation is probably a good thing for the public, if not for individual consumers.
While price might rise for air flights, current price were obviously not sustainable given all the collapses we are seeing. Fewer, more stable airlines charging prices that can see them break even or make profit is better than an unstable melange of airlines, any one of which can drop off the face of the earth at any point living 85,000 people stranded around the world, and 100,000 more holding the bag on vacations paid for but never taken.
That being said, I think we as individual consumers will have to get used to the fact that air travel is going to cost more for the next little while.
But preferable I think that we pay prices for flights that sees airlines continuing to operate than facing the possibility of losing our money when airlines fold, and seeing higher credit card rates and taxes as a result of those organizations having to bail out stranded consumers.