8. Joint ventures/alliances cover a large proportion of Lufthansa's network capacity
Lufthansa has developed a strong position in its use of joint venture agreements with United Airlines, Air Canada and All Nippon Airways. Such arrangements, when approved by competition authorities, allow the participants to coordinate schedules and prices and typically provide significant unit cost enhancements. This helps to resist growing competition from Gulf carriers on Asia Pacific routes (but does not repel it).
Lufthansa's JV agreements cover the USA (its biggest international destination country by ASK), Japan (number three international destination) and Canada (number seven) and account for 37% of its international ASKs. The planned JV with Air China would include Lufthansa's number two destination country and take the proportion of its international ASKs covered by JV arrangements to 43%. Factoring in short haul traffic that is connecting into these JV destination countries, around half of its capacity by ASKs is covered by JVs.
See related reports:
Lufthansa: a joint venture with Air China could mean almost half its ASKs are covered by JVs
Air China-Lufthansa Group JV will control 35% of China-Europe,market while easing growth tensions