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EU expresses concerns on impact on competition over Lufthansa’s plan to take over Air Berlin routes

The European Union voiced out its concerns over the possible impact on competition Lufthansa’s takeover of Air Berlin’s routes might have on competition.

“We have quite deep competition concerns because there is a risk that on some routes Lufthansa becomes de facto a monopoly,” said EU Competition Commissioner, Margrethe Vestager.

The caution comes in the wake of Lufthansa offering concessions to persuade the European Commission to approve its proposed purchase of the parts of Air Berlin.

The group hopes to pony up €210 million ($250 million) for 81 aircraft from Air Berlin’s 140-strong fleet, in addition to takeoff and landing slots, as well as Austrian subsidiary Niki.

But Vestager commented that she is now seeking opinions from customers and competitors in the European aviation market to do away with any anti-trust concerns about the purchase.

Lufthansa might also have to surrender routes in exchange for approval.

Lufthansa Chief Executive Carsten Spohr said that they are ready to meet Vestager’s demands.

Air Berlin triggered bankruptcy measures in August after failing a cash lifeline from its biggest stakeholder, Etihad Airways.

Its aircraft were kept operational by a €150 million emergency loan from the German government while it discussed the sale of its assets.

Since the October deal, the EU has permitted Lufthansa to operate some of Air Berlin’s planes to ensure there were no negative effects on air travelers.

Vestager emphatically clarified that her main priority is to now examine the long-term impact this might have on customers.

In “the long term it is important for the passengers in Germany and in Austria to have choice and also have businesses competing in order to keep prices down because the risk of any monopoly of course is that prices go up,” she said.

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