| Carrier: | Air Berlin
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| Headquarters: | Germany
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| Founded: | 1978
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| Destinations: | 55
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| Bases: | Berlin, Hamburg, Nuremburg, Palma de Mallorca, London (Stansted)
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| Owners: | Public (61.79%), Private Investors (38.21%)
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| Listed: | Yes
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| Online Booking: | Yes
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| Website: | http://www.airberlin.com
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| Fleet | B737-700/800 41
A320s 4 + 54 on order
B737-400 5
| Overview - Air Berlin
Air Berlin – an airline in a hurry Even in a club known for its innovation and ability to act quickly, Air Berlin is a picture of activity, constantly trying new things on its way to becoming the second-largest airline in Germany and Europe’s third-largest LCC.
Air Berlin has also shown itself willing to change course and take on new challenges to cement its position in the European sector. For instance, it ordered Airbus even while operating a fleet of 42 B737s. It also undertook a high-stakes departure from its leisure travel portfolio by launching a business traveller product that offers multiple daily frequencies from German cities with the major commercial centres of Europe. Among those is London Stansted where it is now the third biggest player, serving over 20 cities, including intra-UK destinations.
For all that, there are questions as to whether it is working. The company’s May-06 IPO was delayed when investors indicated that the asking price was too high for a company that had yet to make a profit. Outlook bright However, the IPO went through – if at a lower initial bid price – generating EUR240 million, and the latest quarterly report shows losses narrowed 21% to EUR31 million, even with higher fuel prices.
Acquisition and expansion In Aug-06 Air Berlin announced it had acquired a 100% shareholding in dba, in a merger that will create Germany’s largest LCC.
The airline has been at the forefront of LCC consolidation and rationalisation, purchasing a 24% stake in Austrian LCC Niki Air, from whose Vienna base Air Berlin plans to serve the emerging markets of Eastern Europe and with whom it jointly ordered 70 A320s. The carrier has since 2004 also engaged in codeshare and schedule coordination arrangements with Germania, Tui subsidiary Hapag-Lloyd-Flug and LTU. Air Berlin will initially operate dba as an independent carrier, retaining its existing executive team, but incrementally integrating the two airlines as a unified carrier under the Air Berlin brand. A joint operations schedule will be launched from Apr-07, and existing schedules will be harmonised, potentially increasing aircraft utilisation for both carriers, as well as synergies from joint purchasing, yield management and logistics.
Air Berlin and dba will operate a combined fleet of 87 aircraft and expect to carry up to 20 million passengers in FY06/07. In Nov-05 dba ordered 40 B737s, selling a 25% stake to help fund the transaction. Air Berlin has retained the order, integrated dba's B737 order into its own fleet plans. In Feb-06, dba bought a 60% stake in German long-haul charter carrier LTU, saying it was now the first LCC with a global network. However, the chronically unprofitable LTU, a potential drain on results and management concentration, will be unlikely to follow dba into the merged LCC.
With big plans, a new fleet, a widening network and growing acceptance from the business community, the outlook for Air Berlin looks positive.
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