Lufthansa and Singapore form joint venture

Deutsche Lufthansa, which could report its first full-year operating loss in six years, has agreed to share revenue with Singapore Airlines on routes from Singapore to Germany and Switzerland, in order for Lufthansa to compete with carriers from the Persian Gulf and expand its presence in Asia according to Bloomberg.

Specifically the joint venture will see proceeds divided up on routes from Singapore to Frankfurt and Zurich, which are operated by both carriers, and Singapore’s route to Munich along with a new Dusseldorf service beginning in July. The joint venture also includes Singapore subsidiary SilkAir and Lufthansa subsidiaries Austrian Airlines and Swiss. The agreement will include more than 20 code share routes.

Lufthansa already has joint ventures with Air Canada and United Continental Holdings, Inc. on trans-Atlantic flights and ANA Holdings, Inc. in the Germany-Japan market. The airline is also seeking a partnership with Air China. It is widely speculated that these joint ventures are aimed at taking on the increased competition from the mighty Gulf carriers.

“Our intensified partnership with Singapore Airlines is an excellent addition to our global joint venture network and is a cornerstone of our Asia strategy,” said Lufthansa CEO Carsten Spohr.