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Aviation History
1995
1995 - 1489.PDF
MIR TRANSPORT Challenging Germany's In three years, Deutsche BA has become the second- biggest German scheduled carrier. ANDRZEJ JEZIORSKI/MUNICH Not quite three years since its launch, Deutsche BA is firmly established as Germany's second-biggest scheduled car rier, behind the formidable Lufthansa. It has achieved this by maintaining a steady expansion policy, despite the recent depres sion in the air-transport market. Deutsche BA is now out to prove that it has an identity of its own, and a future as a low-cost high-quality carrier independently of its giant parent com pany, British Airways. Deutsche BA traces its history back to the founding of its Friedrichshafen-based prede cessor, Delta Air Regionalflugverkehr, by Alfred Scholpp in 1978. Delta began by oper ating a commuter service with a de Havilland Twin Otter from Friedrichshafen to the hubs of Stuttgart and Zurich, as well as a turboprop business-charter service. In 1982, Swiss regional carrier Crossair acquired a 25% stake in the company and a co-operation agreement was signed. The air line began scheduled services with Fairchild Metroliner lis between Zurich and Bremen the same year. In 1986, Delta replaced the Metroliners with two 3 3-seat Saab 340As, signing a co-operation agreement with Lufthansa to operate between Friedrichshafen and Frankfurt. The airline's capital was boosted from DM8 million ($5.8 million) to DM20 million, to finance new investments, and Crossair's share was increased to 40%. Delta increased its co-operation with Lufthansa in the following years, expanding its own network and buying more 340s to meet its new route requirements. In March 1992, Delta Air was bought by a consortium of three German banks together with BA, which took a 49% stake in the new company, with Commerzbank taking 19%, and 16% each going to Bayerische Vereinsbank and Berliner Bank. The company was renamed Deutsche BA Luftfahrt- gesellschaft the following May. Deutsche BA wants to prove its own identity independently of parent British Airways PROSPEROUS MARKET BA had been operating four internal German routes since the end of the Second World War as a result of Berlin's post-war political status. The rights to these routes were due to be lost follow ing die re-unification of Germany, but the UK flag carrier decided instead to maintain its pres ence through the formation of this new German subsidiary, thus investing in the potentially high ly prosperous German domestic market. Some observers are now asking whether the completion of European air-transport liberali sation in 1997 will make Deutsche BA redun dant — why should BA bother to maintain a German subsidiary, when it will itself be able to operate with full traffic rights in the German internal market? "The main aspect of having a German com pany as regards traffic rights, is to be able to fly to markets which are not liberalised," says Deutsche BA managing director Richard Heideker. Markets such as Eastern Europe, for instance, could not be operated under BAi traf fic rights from Germany to Moscow. The cost advantage of being smaller is another advantage. "I definitely see even an increasing role for Deutsche BA [after 1997], because BA is not as cost-effective as we are. In the end, if you want to grow in these very competitive markets, you have to have a very low cost basis...and as long as we can keep this difference between British Airways and our company, then we have a very big future," Heideker adds. He stresses that Deutsche BA was always intended to be more than just a feeder into its UK parent's network. The airline is now oper ating domestic trunk routes "in heavy compe- 42 FLIGHT INTERNATIONAL 24 - 30 May 1995
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