The future of German leisure airline Condor has been secured after Polish Aviation Group (PGL) announced it will take over the airline. The agreement is expected to be completed in April and means consolidation in the Central/Eastern European market.
Condor has been one of the victims of the bankruptcy of Thomas Cook and related companies in September 2019, one of the biggest failures in aviation history. Where Thomas Cook had suffered mounting losses that made her insolvent in the end, Condor has been run profitably as a stand-alone unit. It recorded an operating profit of EUR 57 million in its latest Financial Year 2018/19 that closed last November, up 32.4 percent. Revenues increased 6 percent to EUR 1.7 billion, passengers numbers grew 4.5 percent to 9.4 million.
After TC’s bankruptcy, Condor entered ‘Chapter 11’ or preliminary protective shielding in September and was able to continue operations thanks to a EUR 380 million bridging loan provided by the government of the state of Hessen and federal government, securing the jobs of some 5.000 staff. At the same time, Condor kept looking for potential buyers and entered a bidding process with interested parties.
LOT President Rafal Milczarski and Condor CEO Ralf Teckentrup announce the deal.
The preferred bidder has been PGL, the owner of Polish national airline LOT Polish Airlines. For an undisclosed sum, PGL will integrate Condor within its business and make the German airline the center of its leisure strategy, with the focus on Germany and adjacent markets. Not only should this strengthen the position of Condor, but also that of LOT. The combined strength of both airlines is some 20 million passengers, including partner airlines working with LOT. At the same time, Condor will keep its current management, which is lead by CEO Ralf Teckentrup.
Condor will repay the bridging loan (not fully used) to the two German governments, while LOT has announced its intention to invest in the airline and its fleet. Condor flies 13 Airbus A320-200s and 12 A321-200s, 15 Boeing 757-300s and 16 767-300ERs. All Boeings are between 20 and 27 years old, while the Airbus fleet also features aircraft between 15-20 years. The youngest is 3.7-year-old A320, according to Planespotters.
LOT has a fleet of 7 Boeing 787-9s, 8 787-8s, 7 737-800s, 3 -400s, 1 -700s, 15 Embraer E195s, 4 E190s, 12 E175s, 6 E170s, and 12 Bombardier/De Havilland Q400s. The airline has 5 MAX 8s in storage, with 10 more scheduled to join the fleet once the type is cleared for operations.
At a press conference to announce the take over the agreement, LOT President Rafal Milczarski said PGL is looking at some 30 widebodies from Boeing and/or Airbus, of which 20 are for Condor.
Condor’s Boeings – like this 767 – are between 20-27 years old. (Condor)
Condor’s history dates back to 1955 when the airline was formed just before the year ended. Its first charter flights were on March 26 to Israel. Lufthansa increased its share to 100 percent in 1960, after which the airline was called Deutsche Flugdienst. A year later and after taking over Condor Luftreederei, this became just ‘Condor’. Its Boeing-aircraft (including 707s, 727s, and 747s) became easily recognizable by their yellow tails and blue condors, the opposite of the Lufthansa livery. Over the years ownership changed or saw new partners entering the airline, with Lufthansa selling most of its shares to Thomas Cook in 2003. Condor was almost bought by airBerlin in 2007 but the deal collapsed a year later.
Last Spring so before Thomas Cook went bust, Lufthansa CEO Carsten Spohr confirmed he had had a look at Condor. In the end, the former parent-airline never made a bid and now faces competition from an unexpected side.
Strict cost discipline and restructuring since the arrival of Teckentrup have in the end helped Condor survive where its parent company Thomas Cook lost out. Strong bookings for this year confirm the confidence travel agencies, operators, and customers have kept in Condor, Teckentrup said last November.
For Summer 2020, Condor earlier announced new routes out of Frankfurt to Edmonton (Canada), new long haul routes out of Munich, as well as to popular destinations in Greece, Italy, and the Canary Island out of Berlin and Halle-Saale.