KLM Royal Dutch Airlines and German regional carrier Eurowings have signed a contract expanding their co-operation into a long-term partnership aimed at increasing the two airlines' German market share, and bringing Eurowings into the KLM/ Northwest alliance.

The carriers already operate flights from Amsterdam Schiphol Airport to 15 German cities, with 10 of these routes being flown by Eurowings. This makes a combined market share of 7%, which they hope will grow to 15% under the terms of the agreement.

From 25 October, Eurowings passengers are being offered membership of KLM's frequent flyer scheme, also valid on flights operated by Northwest Airlines and other KLM/Northwest Alliance partners.

The KLM partnership comes soon after Eurowings' announcement of a codesharing partnership with the Dutch airline's existing European partner, Alitalia, on flights to Italy.

Eurowings operates services to Paris in co-operation with Air France, offering passengers the Air France frequent traveller programme. The regional carrier has agreed with the French carrier not to offer the KLM programme on this route as well.

Eurowings says it intends to maintain its co-operation with Air France for the foreseeable future, although the KLM alliance rules out any prospect of extending the partnership, unless Air France and KLM themselves link up.

Eurowings says there are no plans for KLM to take a financial stake, although the Dutch airline has shown interest in doing so. A second look may be taken at this idea soon after the turn of the century, when Eurowings will need a capital injection of about $500 million to replace ATR turboprops and leased British Aerospace 146 jets.

The airline says that its fleet renewal will probably get under way in about 2002. "We cannot finance that out of our own pocket," admits Eurowings.

Source: Flight International