For the first time in 14 years, Lufthansa has reclaimed the crown of largest airline in Europe.
Since Air France and KLM merged in 2004, the Franco Dutch airline has held the honor. But in 2018, Lufthansa boosted passengers traffic by 9% compared to only 3% for Air France-KLM. That proved just enough to nudge past.
While Lufthansa subsidiaries including SWISS and Brussels Airlines grew last year, the biggest growth factor was in Eurowings, which grew by nearly 25%. Per Bloomberg, Lufthansa has also experienced an “unexpectedly high demand” for first class, which has fueled growth.
Contrast that with Air France, which experienced prolonged strikes last year and turbulent changes in leadership. While new CEO Ben Smith already appears to be a great stabilizing force, unanswered questions remain. There are also matters beyond the direct control of Air France-KLM like air traffic control strikes and the recent Yellow Vest movement.
It’s not like Air France-KLM is all that far behind. Lufthansa is only 0.2% larger based upon passenger seat mile (number of passengers times miles flown). Still, this news is a sign of both consolidation in Europe and Lufthansa’s favorable position to capture both the full-service and budget markets.
Air France also has British Airways-Iberia closely on its tail, with IAG expanding twice as fast as Air France-KLM in 2018 and drawing closer.
These “largest” distinctions are somewhat meaningless: operational reliability and profits seem a more important indicator to me than any size contest. Nevertheless, look Lufthansa to widen the gap in the year ahead.