Ryanair accuses Lufthansa of “obvious conspiracy”

After filing for bankruptcy on Tuesday, Air Berlin (ETR:AB1) is in talks with Lufthansa (ETR:LHA) to buy the airline’s insolvent air crafts.

Over the past year, Air Berlin’s passenger has rapidly dropped. Last month Germany’s second-biggest carrier lost a quarter of its customers. The airline became bankrupt after the Abu Dhabi-based airline Etihad (TADAWUL:7020) withdraw financial support.

Ryanair (LON:RYA) has criticised the upcoming deals between the two airlines, saying there was “obvious conspiracy” to carve the assets.

“This manufactured insolvency is clearly being set up to allow Lufthansa to take over a debt-free Air Berlin which will be in breach of all known German and EU competition rules.” said the airline.

“Now even the German government is supporting this Lufthansa-led monopoly with 150m euros of state aid so that Lufthansa can acquire Air Berlin and drive domestic air fares in Germany even higher than they already are.”

This was rejected by a spokeswoman for the German economy, who said: “I reject the accusation by Ryanair today that it was a staged insolvency application.”

This is not the only time that budget airline Ryanair has had a problem with the Air Berlin/Lufthansa relationship. 

In January Ryanair chief executive Michael O’Leary described a “wet lease agreement”  between the two airlines as a “joke”.

He said that Air Berlin allowing Lufthansa to operate 38 Air Berlin Airbus jets on its behalf was “a takeover with the aim of dominating the market. Lufthansa controls the capacities of its most important competitor, sets the prices and decides where aircraft will start. The German authorities are doing nothing”.

Transport analyst at Liberum Capital Gerald Khoo said: “Based on August schedules, Germany currently represents just 9% of EasyJet’s capacity and 7% of Ryanair’s, compared with 76% of Lufthansa’s, highlighting the relative importance of that market to each carrier.”

“We would expect German airports to move up the list of priorities for next summer for both major low cost carriers, whether or not they attempt to pick up assets and/or staff from Air Berlin’s bankruptcy process.”