Benchmark Case Studies 2-1; Lufthansa and Qantas Airways
Muhammad Babur Farrukh
HBS580 - Business Strategy
Deutsche Lufthansa AG is a global aviation group. The Group operates in five business segments,each dedicated to high quality standards. The five units
the passenger airline business,logistics, MRO, catering and IT services
all play a leading role in the industry in which theyoperate. The Lufthansa Group includes a total of more than 400 subsidiaries and associatedcompanies.The flag carrier of Germany
(German pronunciation: [ˈdɔʏt ʃə
fthanza]) and the largest airlinein Europe in terms of overall passengers carried and fleet size, comes under Deutsche LufthansaAG. The German government had a 35.68% stake in Lufthansa until 1997, but the company isnow owned, majorly, by private investors who have a stake of 88.52% in the company. (as of March 2007).They can trace their history back to 1926 when Deutsche Luft Hansa was formed in Berlin, anairline that served as flag carrier of the country until 1945 when all services were suspendedfollowing the defeat of Germany in World War II. The new Lufthansa was formed on January 6,1953, a company for air traffic demand, and was renamed Deutsche Lufthansa and re-launchedas an airline on August 6, 1954.It is the world's fourth-largest airline in terms of overall passengers carried, operating servicesto 18 domestic destinations and 203 international destinations in 78 countries across Africa,Americas, Asia and Europe. Together with its partners, Lufthansa services around 410destinations. With over 710 aircraft it has the second-largest passenger airline fleet in the worldwhen combined with its subsidiaries.Lufthansa's registered office and corporate headquarters is in Deutz, Cologne, Germany, with itsmain operations base (Lufthansa Aviation Centre (LAC) and primary traffic hub at Frankfurt Airport in Frankfurt. The majority of Lufthansa's pilots, ground staff, and flight attendants arebased in Frankfurt.It is a founding member of Star Alliance, the world's largest airline alliance, formed in 1997. TheLufthansa Group employs 117,000 people worldwide of 146 nationalities. In 2010, over 90million passengers flew with Lufthansa (excluding Germanwings and Brussels Airlines).On May 18, 1997, Lufthansa, Air Canada, Scandinavian Airlines, Thai Airways and UnitedAirlines formed the Star Alliance, the world's first multilateral airline alliance. In 2000, Air Onebecame a partner airline of Lufthansa and nearly all Air One flights were code-shared withLufthansa until the purchase of Air One by Alitalia. In 1971, Lawrence Fellows of The New York Times described the then-new headquarters building that Lufthansa occupied in Cologne as"gleaming". In 1986, terrorists bombed the headquarters of Lufthansa. No people receivedinjuries as a result of the bombing. By the end of 2007 Lufthansa planned to move 800employees, including the company's finance department, to the new building, in Deutz, Cologne.
In 2011, Lufthansa was the world‘s first airline to test the use
of biofuel in regular operations.As part of the burnFAIR research project, Lufthansa operated an Airbus between Hamburg andFrankfurt four times daily, with one of its engines running 50% on biofuel. The main objective of this long-term trial was to gather experience and to collect data. The trails were a success, andnow further exploration is begin done to build engines which can run on 100% of biofuel.