Lufthansa Buys 777s... But Not for Itself
Lufthansa announced Monday that its board has approved an order for two long-haul Boeing 777-300ER aircraft, among others. The two wide-body jets will go to the airline group's subsidiary SWISS and are expected to enter service in 2020.
The order is part of an ongoing effort since 2016 by SWISS to update its long-haul fleet with 777-300ERs, according to the airline's website. Lufthansa says the two new 777s will be used to expand SWISS' route network. SWISS uses its current 777s "for connections such as San Francisco, Los Angeles, Bangkok and Hong Kong."
TPG Contributor J. Keith van Straaten flew a SWISS 777-300ER in January from Zurich (ZRH) to Los Angeles (LAX) in economy and found the overall experience to be "a very good flight for a very good price." Check out this post for a complete tour of the carrier's 777-300ER.
Lufthansa's order for SWISS might well be worth the investment for the airline group — in the first quarter of 2018, SWISS had a profit margin of more than 9%. The German aviation conglomerate took over SWISS in 2005.
SWISS' two 777s are part of a larger order by Lufthansa of 16 new aircraft from both Boeing and competitor Airbus. Among the other planes in the order are 12 Airbus A320ceos and two Boeing 777Fs for Lufthansa's cargo operations.
The list price for the total 16 aircraft is estimated at 2.1 billion euros (about $2.5 billion USD). All of the aircraft ordered by Lufthansa are expected to be delivered through 2022, according to Reuters.