* Etihad Abu Dhabi-Germany flights to carry LH code
* Lufthansa flights to Rio and Bogota to carry EY code
* Follows similar deals by Qantas/Emirates and BA/Qatar
* Lufthansa also finalised Air Berlin lease deal
(Recasts, adds details of lease, analyst comment, background)
By Victoria Bryan and Peter Maushagen
BERLIN/FRANKFURT, Dec 16 Lufthansa has
struck its first cooperation deal with a Gulf rival, agreeing to
sell tickets jointly with Etihad Airways on some routes and
leaving the door open to further agreements in other areas.
Germany's biggest airline has been a fierce critic of Gulf
carriers on the grounds their state backing gives them an unfair
competitive advantage and it has in the past objected to
code-sharing by German rival Air Berlin and Etihad.
Other airlines already work with fast-growing Middle Eastern
carriers, however, and the code-sharing deal signed on Friday
comes on top of Lufthansa's agreement to lease planes and crew
from struggling Air Berlin, which is 29-percent owned by Etihad.
Australia's Qantas Airways has a similar
code-sharing agreement with Etihad rival Emirates while British
Airways has a revenue-sharing deal with Qatar Airways, which
owns 20 percent of BA's parent IAG.
Independent industry consultant John Strickland said
Lufthansa's deal with Etihad was a positive move.
"Other major airline groups like IAG & Qantas have long seen
the value of this," he said.
Under the deal, Lufthansa will place its LH code on Etihad's
flights between Abu Dhabi and Frankfurt and Munich. Lufthansa
had previously scrapped its Frankfurt-Abu Dhabi flights saying
they were not profitable due to overcapacity created by the
code-share deal between Etihad and Air Berlin.
Etihad will in turn put its EY code on Lufthansa's long-haul
services between Frankfurt and Rio de Janeiro and Bogota.
The two will also consider extending their cooperation in
other areas, Lufthansa CEO Carsten Spohr said in a statement.
Qatar and IAG, for example, have also cooperated on their
A source said Lufthansa and Etihad were planning code shares
on more routes. A Lufthansa spokesman declined to comment
further on possible areas of cooperation.
Others analysts cautioned against reading too much into the
deal, highlighting it was restricted in its scope for now.
"The limited code share agreement announced today is in our
view a marginal price component for the Air Berlin deal," Kepler
Cheuvreux analyst Ruxandra Haradau-Doeser said, adding that she
did not think a deeper partnership was likely.
Strickland said the tie-up also showed pragmatism in light
of the Air Berlin so-called wet lease deal, which will remove
some excess capacity from the European market.
Airlines have made a flood of seats available this year,
taking advantage of lower oil prices to try to grab market
share, but this led to lower ticket prices and put airline
profits under pressure.
Of the 38 Air Berlin planes in the wet lease deal, 33 A319
and A320 jets will go to Eurowings, which Lufthansa is expanding
Eurowings will use the Air Berlin planes to replace 20 older
A320 jets, removing some of the extra seats from the market.
Also, Eurowings said it will station four planes at a new base
in Munich, traditionally a hub for Lufthansa-branded flights.
(Additional reporting by Maria Sheahan,; editing by Greg
Mahlich and David Clarke)