Lutfhansa plans 1-bn-euro spending spree on planes

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Germany's largest airline Lufthansa said Tuesday it would push "rapid growth" at low-cost subsidiary Eurowings by spending 1.0 billion euros (1.2 billion US dollars) on acquiring more planes, some of them from bankrupt competitor Air Berlin.

"The funds will be used towards obtaining up to 61 aircraft, including 41 Airbus A320 Family aircraft" and 20 smaller turboprop planes, Lufthansa said in a statement – both types found in Air Berlin's fleet.

"Acquisition of the aircraft is partly dependent on the successful conclusion of negotiations" with the stricken carrier, the group added.

Lufthansa has emerged as the leading bidder for Air Berlin's assets, including valuable landing and takeoff slots at German airports, following its insolvency declaration in mid-August.

The group has already bought or holds an option to buy some 20 Air Berlin aircraft that were leased to Eurowings in recent months.

With Tuesday's announcement on top, the low-cost subsidiary will grow by a total of up to 81 aircraft.

It is not clear exactly how many planes Lufthansa wants to buy from Germany's number two airline, but chief executive Carsten Spohr recently suggested he could buy between 58 and 78 aircraft – around half of Air Berlin's fleet.

News agency DPA reported the yellow-and-blue liveried airline hopes to grab 55 planes belonging to Air Berlin subsidiaries Niki and LGW, as well as 13 more from the parent company, for a total of 68.

Meanwhile, Britain's EasyJet, the other bidder in talks with Air Berlin, is interested in 27 to 30 planes.

Operating the new planes would create "up to 3,000 additional jobs, especially in the cockpit and cabin crew fields," the Lufthansa statement added.

Many of those posts could go to former Air Berlin employees.

The insolvent firm's administrators said Monday that as many of 80 percent of its more than 8,000 workers could find jobs at Lufthansa and Britain's EasyJet.

Air Berlin executives, administrators and buyers are set to thrash out deals to dismantle the company by October 12.

Source(s): AFP