Will Take Over Most Domestic, European Routes

The board of directors of Lufthansa has voted to create a low-cost brand to fly many of its domestic and European routes beginning on January 1, 2013. The main airline will still operate flights which make connections at its twin hubs of Munich and Frankfurt.

The not-yet-named budget airline will absorb Lufthansa's current low-cost carrier Germanwings. Reuters reports that the board expects that the new entity will fly as many as 18 million passengers every year.

No determination has yet been made about fares or ancillary fees.

The new carrier will typically fly routes such as London to Cologne, Dusseldorf, Hamburg, and Stuttgart. It will also handle flights from Birmingham and Manchester in the UK to Berlin. Lufthansa is reportedly working to trim operating costs by over a billion Euros, and Air & Business Travel News reports it plans to scrap its Munich-Singapore-Jakarta service, and either has already or plans to discontinue its London Gatwick to Frankfurt and London City to Munich flights. It is also evaluating flights to Bangkok.

ATBN says that the new airline is still in its formulation stage, but expects that it is likely to alter the short-haul business model currently used by many low-cost carriers.

FMI: www.lufthansa.com