Lufthansa Faces Challenges from Chinese Airlines in Asian Skies

Lufthansa's Asian operations are under pressure due to competition from Chinese airlines that bypass Russian airspace, despite strong demand between Europe and China. The Chinese carriers' increased capacity and strategic routes are causing a drop in Lufthansa’s yields in Asia, prompting the airline to seek cost-cutting measures.

Competition from Chinese airlines, which continue to fly over Russia despite the ongoing conflict, is impacting Lufthansa's business in Asia. Although demand between Europe and China remains strong, overcapacity from Chinese carriers is hurting profitability, according to Lufthansa's Vice President Asia Pacific, Felipe Bonifatti.

This trend has been observed since the war in Ukraine and the pandemic, with Chinese airlines gaining a larger share of China's international air traffic. Meanwhile, Lufthansa and other non-Chinese carriers face the challenge of increased travel costs due to rerouting around Russian airspace.

Efforts to address these challenges include discussions with Air China about capacity management. Yet, Lufthansa is focusing on maintaining operational stability amidst delivery delays of new aircraft, while continuing to prioritize cost-efficiency in its Asia-Pacific operations.

(With inputs from agencies.)