IATA: New focus key to Air Berlin turnaround hopes

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Air Berlin's new chief executive believes the airline is pursuing a valid business model, despite its heavy losses. But he warns that the carrier cannot view shareholder Etihad Airways as a financial safety net.

Etihad has a 29% stake in the German operator and has been engaged in initiatives to help stabilise the carrier and support its "Turbine" restructuring programme.

Air Berlin chief executive Wolfgang Prock-Schauer, appointed to head the airline less than five months ago, insists: "The business model is right, but it needs much more focus."

He says the airline has tried to serve "too many destinations" and operate too many crew bases in Germany.

Prock-Schauer says the carrier has cut 20% of its routes over the past year in favour of increasing frequencies on stronger sectors.

The restructuring effort is "streamlining" the Air Berlin operation, which expanded through various diverse activities, including the takeover of low-cost operator DBA and holiday airline LTU.

Air Berlin is reshaping its route network to capitalise on its Oneworld membership and the alliance with Etihad, which enables it to channel passengers to Asia via Abu Dhabi.

Prock-Schauer insists there will be no conflict between its dual Gulf partnerships when Qatar Airways becomes a member of Oneworld later this year.

Etihad, which is unallied, is an "excellent co-operation partner for us", he says, adding that the airline's combined status as shareholder and partner is "ideal" for Air Berlin.

"We're very close in discussions with them," he states. Etihad is playing a role in addressing Air Berlin's fleet requirements and is taking surplus pilots from the German carrier.

While the investment from Etihad has assisted the carrier's restructuring, he says there is a "very clear" message that the Middle Eastern operator cannot act as a financial safeguard for a loss-making operator. "We have to survive on our own," he says.