Lufthansa holds firm amid EU antitrust scrutiny over ITA Airways stake

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In the high-stakes world of airline mergers, Lufthansa is holding its ground. The German carrier, eyeing a significant stake in Italy’s state-owned ITA Airways, has no intention of offering additional concessions to appease EU antitrust regulators. Despite lingering concerns about the impact on long-haul flights, insiders reveal that Lufthansa is firm in its stance, having already put forth three rounds of remedies. The latest proposal, tabled last month, suggested delaying ITA’s integration into its joint venture with United Airlines and Air Canada for two years – a move that was meant to quell regulatory unease.

Lufthansa’s silence on the matter speaks volumes. The airline, aiming to acquire a 41% stake in the Alitalia successor, has made significant offers but now stands resolute. The tweaks made since the last proposal have been minor, indicating Lufthansa’s confidence in the strength of its current bid. By holding off ITA’s integration into a larger alliance, the German airline had hoped to mitigate fears of market dominance and unfair competition, but it appears that the EU regulators remain unconvinced.

Adding to its arsenal of concessions, Lufthansa has agreed to maintain some competing ITA short-haul routes to Germany, Belgium, Switzerland, and Austria. Furthermore, the airline has offered to cede 40 slots at Milan Linate airport to budget carriers easyJet and Volotea. This move addresses concerns over ITA’s potential dominance at this crucial hub. However, it remains uncertain whether these measures will suffice to alleviate the European Commission’s worries about the broader implications of the merger on both short-haul and long-haul flights.

As the clock ticks towards the end of the month, the European Commission’s verdict looms large. Acting as the EU’s competition watchdog, the Commission’s decision will either pave the way for a transformative partnership or send Lufthansa back to the drawing board. With the stakes higher than ever, the aviation industry watches closely, awaiting the final word on a deal that could reshape the European skies.

(Source: Politico | AetoTime)

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