Etihad Aviation Group, the holding company for the Abu Dhabi carrier, is to forge a new presence in the European tourism business in partnership with German travel company TUI.
It has approved a plan to create a new European leisure airline with a fleet of about 60 aircraft offering 15 million plane seats per year, serving the routes between the affluent centre of the continent and well-established holiday destinations in the Mediterranean.
A statement from Etihad said: “The joint venture will be supported by the expertise of Etihad Aviation Group, the fastest-growing aviation group in the world, and TUI Group, the world’s leading tourism business with a strong focus on hotels and cruises.”
It will be able to leverage synergies and economies of scale accessible through Etihad Airways Partners – the seven-strong global alliance of airlines under the Etihad umbrella – and TUI to ensure a “lean overhead structure and competitive production cost”, the statement said.
The subsidiary Etihad Investment will, subject to approval from aviation and competition authorities, acquire a 49.8 per cent stake held by airberlin, a member of the Etihad alliance, in a leisure airline company Nikki Lufthart.
This will be injected into the new leisure company. TUI will contribute its subsidiary TUIfly to the joint venture, including the 14 aircraft operated by TUIfly for airberlin under a “wet-lease” agreement for the aircraft, crew and maintenance.
When the deal is finally approved, Etihad will own 25 per cent of the new venture, with TUI holding a slightly smaller stake. Majority control of the new venture will rest with the existing owner, the private foundation Niki Privatstiftung.
Etihad has a seven-strong global alliance of airlines. Kamran Jebreili / AP Photo
The new leisure airline group, headquartered in Vienna, is scheduled to begin operations next April, the start of the crucial summer season.
It will serve a broad network of destinations from Germany, Austria and Switzerland with airports at Hanover, Berlin, Düsseldorf, Cologne, Frankfurt, Stuttgart, Munich, Nuremberg, Baden-Baden, Hamburg, Basel and Vienna. Key markets will include the Balearics, Canaries, mainland Spain and Greece.
The deal is a further step in the rationalisation of Etihad’s interest in airberlin, the loss-making German airline, which will exit the tourism trade to concentrate instead on scheduled short- and medium-haul operations in Europe, as well as an expansion of its long-haul business to include more transatlantic flights.
TUI, which took over the business of UK tourism groups Thomson Travel and First Choice, is regarded as one of the leading leisure companies in the world, with 75,000 employees and 30 million customers.
It has a portfolio of more than 300 hotels, 14 cruise liners, six European airlines with about 140 aircraft and a wide-reaching distribution network of more than 1,800 travel agencies and online portals.
fkane@thenational.ae
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