Lufthansa losing market share of business travel

Lufthansa’s market share of UK to Germany business flights dropped 8.5% in the three months after it imposed a €16 charge on all GDS bookings.

According to figures released by the GTMC, whose members make up the majority of UK travel management companies, Lufthansa’s market share was 32.9% in June but dropped to 24.4% in November.

Lufthansa’s controversial charge was introduced on September 1.

In comparison, rival carriers either matched or increased their market share over the same period.

According to the figures, BA’s market share remained steady while Easyjet and other airlines grew market share.

The GTMC said the drop suggests TMCs have switched business away from Lufthansa to avoid passing on the charge to their customers.

"We predicted that the Lufthansa charge would upset and put business travel bookers off," said Paul Wait, GTMC chief executive.

"They haven’t booked directly with Lufthansa as they hoped, instead, they have voted with their feet and taken their business elsewhere.

"In this highly competitive market, we believe, this charge has done some obvious damage to Lufthansa’s market share. It is a flawed and failed strategy which should be reviewed."

But Lufthansa dismissed the figures, saying they only represent the volume of bookings made though GTMC channels and do not take account of increases in the bookings through other avenues.

"The fact is that we have sold more tickets online via our own online channel LH.com where the share has risen from 29% in June 2015 to 35% in December 2015," said a spokesman.
 
The spokesman said the Lufthansa Group has not seen any decrease since the charge was introduced and is heading towards a record financial year.

"The published traffic figures for the later months of 2015 were influenced by the biggest and longest strike action in the Lufthansa history. Even taking this into account, we cannot see any switch away from Lufthansa," he said.
 
The spokesman added: "In the long term, the Lufthansa Group is modernising its distribution landscape to make sure it is ready for the changing demands of its customers. The new sales strategy includes a clear differentiation showing the cost split across the different booking channels.

"The customer should only pay the service he or she receives. If they use a more expensive sales channel, they have to share the higher cost of this booking method."
 

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