The reason Lufthansa and JetBlue Airways' partnership out of New York never took off in the way many expected is simple - their needs changed along with the market.
"They needed us less, because they relied on American for example more and more," says Carsten Spohr, chief executive of Lufthansa German Airlines, in an interview in Frankfurt on 31 May. "We needed them less because we relied on Continental-United in Newark more and more."
The German carrier made an about $300 million investment in the New York-based airline in December 2007, in part to fill a gap in its US partner network with JetBlue's hub at John F. Kennedy (JFK) International airport. Its long-standing trans-Atlantic joint venture partner United Airlines lacked a hub in the New York area.
However, the partnership never extended beyond a one-way codeshare, with Lufthansa placing its code on select JetBlue flights beyond New York.
"For JetBlue to be successful, they couldn't pay to much attention to what their investor needs from them," says Spohr. "They needed to see what the market, what the customer asks them to do and not necessarily what [their] minority shareholder wants."
Dave Barger, chief executive of JetBlue, told Airline Business in 2010 that it was very grateful for Lufthansa's guidance and expertise but that it has always maintained its strategy of partnering with a large variety of airlines versus a few deep partnerships.
"What we've always said to Lufthansa is that, as the largest airline at Kennedy and the largest domestic airline in New York, we're attractive to many airlines in terms of partnership opportunities," he said.
United's merger with Continental Airlines in 2010, which brought the latter's large hub at Newark Liberty International airport into the former's network, also answered Lufthansa's New York network gap. This "downplayed" the German carrier's need to rely on JetBlue in the New York area, says Spohr.
This confluence of factors resulted in Lufthansa opting to try and divest its roughly 16% stake in the New York-based carrier. It launched a €234.4 million ($306.7 million) convertible bond in March 2012 that gives investors the opportunity to redeem their notes for shares of JetBlue. The bond matures in April 2017.
Spohr says that he spoke with Barger last week and everything was "fine as ever".
Note: An earlier version of this article attributed the quotes to Christoph Franz, chief executive of Lufthansa Group.