Lufthansa Buys Stake in Brussels Airlines, Looks at Alitalia

“The Germans marched into Brussels today as they discussed further cooperation with the Italians.”

I can’t say I ever thought that statement would be looked upon favorably, but that’s exactly what we’re seeing now. Yesterday, Lufthansa purchased a 45% stake in Brussels Airlines and they continue to talk about rescuing Alitalia. This would be good news for both those airlines and for Star Alliance, but the other alliances aren’t going to be so happy. If you have miles with SkyTeam or on American, you’ll want to watch closely.

First, let’s look at the Brussels Airlines deal. You may not have even heard of Brussels, but you probably knew the name Sabena. That airline, one of the oldest in the world, failed earlier this decade. From its ashes, Brussels Airlines was created but in a slimmed down form. After being combined with the floundering Virgin Express, Brussels now focuses on flights within Europe and down to former Belgian colonies in Africa. They currently codeshare with American on US flights, but that’s likely to be coming to an end.

Lufthansa will take 45% of the airline immediately with the opportunity to buy the rest of it by 2011. The airline will operate similar to the way Swiss does. Brussels will remain a separate brand with its own headquarters. It’s safe to assume that the airline will join Star Alliance and will ditch American. Actually, we know that Brussels will join Star Alliance. Lufthansa chief Wolfgang Mayrhuber said, “Belgium and Germany as well as the Star Alliance member-airlines will profit from the merger.”

So if you have American miles and you want to fly Brussels, you might want to book soon. Nothing has been announced and they’ll likely give some notice before the partnership ends, but it’s going to happen. Just be ready.

Meanwhile, Alitalia continues to sink deeper into the abyss. The Alitalia unions incredibly would rather all lose their jobs than cut their wages and lose some jobs. So, they won’t agree to the restructuring and the previous coalition has walked away for now. So what does PM Berlusconi do? He looks to Lufthansa, calling them an “ideal partner.”

Yeah, ok. So if you’re a SkyTeam mileage earner, Alitalia could end up leaving, but I’d be more concerned that they cease to exist instead. Don’t book them until (if) this situation is resolved.

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