January 10th, 2018
Lufthansa’s Financial Strategy|company overview
Lufthansa group (Deutsche Lufthansa AG) is an aviation firm headquartered in Germany but providing its services in a various global markets. The company which traces its roots to the merger between “Deutscher Aero Llyod and Junkers Luftverkeh” to form “Deutsche Luft Hansa AG” in 1926 (Lufthansa n.d) has grown with the growth of the air transport industry into one of the leading airlines in the world. Being a founding member of a main alliance of global airlines – Star alliance – (Lufthansa n.d) the company has been able to provide services to different corners of the globe hence improving its performance and financial position.
Lufthansa group now boasts of “over 400 subsidiaries and associated companies” (Lufthansa 2010, p. 44). The services offered by the entity have also been diversified into five large segments. These segments – “passenger airline group, logistics, MRO, and catering” – serve to provide mobility and services in the airline industry across the globe (Lufthansa 2010, p. 43). The principal segment and highest revenue earner for the company is the passenger airline segment which offers passenger transportation services to numerous global destinations (Lufthansa 2010). The second segment, the logistics segment, offers cargo services with the partnering with DHL express, one of the leading global integrators, enabling the firm to access the Asian markets (Lufthansa, 2010). A third segment in the group is the MRO segment – Lufthansa Technik – which provides “maintenance, repair and overhaul [MRO] services for civil aircraft (Lufthansa 2010, p. 13). This and the last two segments, IT services segment and the catering segment (LSG sky chefs) provide support services to the passenger airline and logistics segments as well as offering their services to external aviation organizations (Lufthansa, 2010). Go to part 3 here.