Andrzej Jeziorski/MUNICH

Condor Flugdienst, the charter subsidiary of Lufthansa, is expected to found a Berlin-based subsidiary airline within weeks.

According to Condor, plans are being finalised for a low-cost airline, to be called Condor Berlin, which will compete against rivals such as Aero Lloyd and Air Berlin. The company will still fly in regular Condor colours, and the capacity offered will be fully integrated into Condor's regular network.

The new airline is to take delivery of its first three Airbus A320-200s in April 1998, with three more coming in the third quarter. One of the first A320s is likely to be operated from Stuttgart, says Condor.

The airline has options on six more aircraft, with a further 12 under consideration, says Condor chairman Franz Schoiber. Pilots will be transferred from Lufthansa, but cabin staff are likely to be hired.

The airline says that it is forming the subsidiary because it wants to compete in the 160-seat segment of the market, and its competitors serving Berlin are offering prices that can only be matched sensibly by a smaller company with a lower cost base than Condor itself. The airline expects Condor Berlin's costs to be about 20% lower than its own.

"Up to now, we have only served this market segment with four Boeing 737-300s leased from Germania, and these leases are running out," says the company. Berlin offers the ideal infrastructure, including maintenance, to found such a company, says Condor.

Schoiber says that the airline is phasing out its five McDonnell Douglas DC-10-30s, and in future wants to operate an all-Boeing 757 and 767 fleet, with Condor Berlin operating the A320s.

Condor, which operates nine Boeing 767-300ERs and 18 757-200s, has arranged to sell two DC-10s later this year, and the remaining three will be gone by 1999, when deliveries begin of 12 Boeing 757-300s now on order.

Source: Flight International