Inquirer wrote:Quite a few people are obviously disappointed by Lufthansa, probably because they had quite high expectations from them and saw them as some kind of a santaclaus who'd be expanding Bru.Air into another Swiss.
The question is; were these expectations real to start with? Personally, I would say no.
My expectations were high for LH, as an employee at the time.
If we remind ourselves what SN was like before LH stepped in, it was a passive company with passive shareholders that was breaking even but still standing strongly on its feet and within its niche. All employees including managers were looking forward to being part of the LH group, as it would mean that LH would make the company less passive and develop it into a stronger, independent and thriving entity.
That's what was said at the time.
So I too believed all that cr*p and thought that LH would play out to be a better partner than say BA.
It didn't take me long to start doubting LH's motives as I didn't see anything improve at SN, quite to the contrary. In fact as an employee, you could see with naked eyes how things went from bad to worse, to the point that it wasn't worth it for me anymore, despite that I loved SN and aviation. The union guys didn't seem to do anything, nor was I relying on them to do anything because there was simply no future left to fight for.
I wasn't the only one. I hear that things are even worse nowadays, which I can't imagine...
So yes expectations were high because no one thought that the only result of the LH transaction would be that
A. the shareholders get some of their money back,
B. SN would join Star without any sensitive increase in traffic and/or revenues, and
C. (only) pilots get to non-rev with LH. Wow!
D. SN would join A++ in a venture where anyone knew from the beginning that it would be difficult to make money. Some employees were happy that they could fly cheap to New York, but those weren't aware of the bigger picture problem, ie, that they were going to pay the difference in another way someday.
Justified, not justified...well, when a big company buys a significant share into your company that has great, untapped potential, the least you expect is the status quo, but you hope for improvement.
But no, SN is now in worse shape than when it was started up. We can blame it on Gustin and his team but for that we need to know all the facts, because I start to think that LH's extreme passiveness, even worse than the original shareholders, plays a bigger role in this story.
Tolipanebas and some other beliebers assured us year after year that LH would soon make a move... the spring came and went, year after year and I was skeptical and at the same time I hoped I was wrong.
This joke has been going on for 5 years and it makes me angry.
What is however going to be crucial in my view is this year.
With the European economy picking up (and aviation is a leading indicator for that), improved financial results in BRU and a debt restructuring successfully concluded, the situation is as good as back to normal now, so there should be no more immediate excuses for Lufthansa to play another waiting game for several years if they are really still interested: Sure, there's increased competition now, but that's just the consequence of operating in a lucrative and growing business, so my eye really is on the end of this year: they really need to make a move then, or give up.
(IMO The increased competition can also be blamed to passiveness from shareholders, including LH)
Good remark but the worst thing is that if LH "give up" at the end of the year, SN will be lost. I don't blame the government and Davignon for getting out of their way and saving all these jobs (in fact I applaude them), but I blame them for closing all other options and giving LH, who is barely doing anything for SN, the best cards. This proves one thing for certain: LH know how to negotiate.
Now a question to our lawyers/jurists on the forum:
If SN enters a "chapter 11" procedure (whatever equivalent in Belgium - judicial reorganisation?) and the court seeks a buyer, does LH still maintain the exclusive rights to purchase the company if they fail to exercise them during this procedure by the court, or can the court cancel their exclusive rights with the interest to save the company by transferring it to a third party with a decent business plan?
It does sound like a way out of the exclusive purchase agreement if things continue like this and SN needs to go to plan B.
Last but not least, I feel like the original shareholders are letting LH do all the thinking, based on LH's expertise in the field. I hope that they realise that they better start doing their own thinking again because those "experts" aren't very good or don't seem very motivated...
If it wouldn't have been because of Lufthansa, Bru.air might not have been around any longer by now, because IMHO, the Germans are very very lenient on them and very understanding of the situation.
Don't expect this kind of an attitude from Chinese, American or Middle Eastern airlines, let alone from investment funds, would be my advice!
LH haven't injected much into SN yet (have they at all?), and their so-called management expertise support is nowhere to be found in SN's results.
I don't see what LH has done to keep SN alive until now. Sure they paid its shareholders off to be able to join the club but only a small amount stayed in SN's bank account. They transferred some Africa routes from LX to SN, but that was internal competition in the first place and LX was probably not doing so good.
From my point of view, LH has nothing to be lenient or understanding about, since they haven't invested anything for SN, except useless expertise under the form of LH managers who haven't contributed much to improving SN, if they haven't made it worse.
Even then, SN had to pay their salaries, so it's not like it was for free.
) when was the decision made (by the Board of Directors, I presume) to extent the take-over deadline from 2014 to 2017 ? Today it sounds (to me) like the wrong decison. As to "other potential investors" : if you invest in a very fragile company or airline it's either to "kill a competitor" (which is not the case with LH, but could be the case with AF/KL) or to help it get profitable and solid (which is not what LH is doing ; LH is giving b.air just the necessary oxygen to survice while telling them : get profitable, but basically do it alone, while knowing that there is no margin left to increase productivity or reducing costs.
) of long haul expansion for b.air
