Lufthansa plans to reroute Brazil traffic via Lisbon

Lufthansa plans to route some passengers now flying to Brazil via Frankfurt, Munich and Zurich through Lisbon instead, after the German group was selected by Portugal’s government in the TAP privatisation. The move would use TAP to reshape traffic flows on South Atlantic routes and strengthen Lisbon’s role in the group’s network.

Speaking to analysts on Thursday, chief executive Carsten Spohr said Lufthansa currently fills part of its Brazil flights with passengers from France, Spain and Portugal by offering competitive fares via its German and Swiss hubs, but wants some of that traffic to pass through Lisbon in future. He said that, together with TAP, Lufthansa’s share of the Europe-Latin America market would rise from 9% to 20%, putting it level with IAG on those routes.

Spohr also said the reverse could happen, with the Portuguese market gaining more weight in the group’s airports for connections to Asia. Lufthansa’s finance chief Till Streichert said the deal could generate net synergies of up to €450 million a year, mainly from network optimisation, commercial cooperation, procurement, maintenance and cargo.

Streichert said Lufthansa expects to capture about two-thirds of that value within around three years and the full amount in about four years. Asked whether the synergies depended on Lisbon’s capacity-constrained airport, Spohr said Lisbon is “central for TAP” but added that the value would also come from areas including sales and distribution, cargo, loyalty and aircraft purchasing, some of which do not depend on the hub. He did not announce new routes, frequencies or investment for Lisbon.

Originally published at Eco.pt