Will Airberlin be absorbed into Lufthansa? (Photo: Air Berlin)

It looks like Germany’s second-largest airline will be absorbed into its largest as Lufthansa moves in on Airberlin.

The dealings in Germany could affect U.S. travelers because Airberlin has routes to a number of U.S. cities from its bases at Berlin and Dusseldorf; it recently announced plans to begin San Francisco-Berlin and Los Angeles-Berlin flights next summer. Lufthansa’s U.S. flights go into its hubs at Frankfurt and Munich.

According to German media, Airberlin has been facing financial difficulties for some time, and has been propped up by Etihad Airways, which owns a 30 percent stake in the German carrier. And Etihad has recently been negotiating with Lufthansa over Airberlin’s fate.

Last week, Lufthansa agreed to lease 38 planes and crews from Airberlin; the Airbus A319s and A320s will go to Lufthansa’s growing Eurowings low-cost subsidiary and to Austrian Airlines, which Lufthansa also owns. Lufthansa also agreed to begin code-sharing with Etihad starting next month, putting its LH code onto the latter’s flights from Frankfurt and Munich to Abu Dhabi.

And this week, Airberlin’s board appointed a new CEO for the airline: Thomas Winkelmann, a longtime Lufthansa senior executive. The German financial newspaper Handelsblatt reported that the German federal government and state governments in Munich and Dusseldorf “have agreed to facilitate Airberlin’s gradual integration into Lufthansa, which would lead to the effective merger of the nation’s top two airlines.” And the prominent industry publication Aviation Week said that Lufthansa “has begun to look at ways that it could integrate the remaining parts” of Airberlin following that big lease agreement.

There was no immediate word on the likely fate of Airberlin’s long-haul aircraft, like the two-class A330s it flies to the U.S. Airberlin is a member of American Airlines’ Oneworld global alliance, While Lufthansa is part of United’s Star Alliance.

Expansive check-in hall at Frankfurt Airport’s new Terminal 3. (Image: Fraport)

German government officials reportedly didn’t want to see Etihad negotiate a sale of Airberlin to a foreign carrier. But a combination of Airberlin and Lufthansa will face possible opposition on antitrust grounds, Handelsblatt noted. “With 30.3 million passengers and more than $4.2 billion in revenue last year, Airberlin is a big fish to swallow, even for a carrier the size of Lufthansa,” the newspaper said.

Much of Lufthansa’s growth is concentrated on its Eurowings unit, which it sees as its primary weapon in competition against giant intra-European low-cost carriers like Ryanair and Easyjet. Earlier this month, Lufthansa said it would purchase the remaining 55 percent of Brussels Airlines that it doesn’t already own. So Lufthansa’s growing aviation empire will include Austrian Airlines, Swiss International, Brussels Airlines – and probably Airberlin, although that carrier’s identity might not survive. Even without Airberlin, the Lufthansa Group would control 700 aircraft, with up to 180 of them in Eurowings.

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