The Sky is Shrinking

More mergers + possibly more options = higher airfares? Well, perhaps not more options as these mergers may produce a tighter schedule. This is the latest news on airline consolidation wishes. Posted here are snippets of the full article on of all places China Daily athttp://www.chinadaily.com.cn/bizchina/2009-06/01/content_7958949.htm Lufthansa's next targets are Austrian Airlines and Brussels Airlines.

The German carrier made a public offer to purchase the stock held by all free-float shareholders of Austrian Airlines AG in February. More than 85 percent of the shareholders of Austrian Airlines had accepted the offer by last month.

Lufthansa also plans to take a 45 percent stake in Brussels Airlines, which may later be increased to 100 percent.

Lufthansa's major European rivals such as Air France-KLM and British Airways have also showed great interest in consolidation.

Air France-KLM, Europe's largest airline by revenue, finalized a deal on May 20 with Delta to operate as one airline over the North Atlantic. Air France and KLM merged in 2004 and Delta bought Northwest Airlines last year, which paved the way for a four-way partnership. The pact between the two largest airlines on each side of the ocean involved sharing revenues and costs on more than 200 trans-Atlantic flights.

Air France-KLM completed its purchase of a 25 percent stake in Alitalia earlier this year. It has also submitted a non-binding offer for Czech Airlines, while British Airways said last year that it planned to merge with Iberia, the Spanish flag carrier.

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