Condor sale could draw Gulf airline interest, says CEO

Condor may ultimately become part of a larger airline group as the German government seeks an exit from the leisure carrier, with chief executive Peter Gerber suggesting that airlines from the Gulf may emerge as potential bidders once the sale process begins. 

Speaking to German magazine Stern, Gerber said consolidation appeared to be the most likely long-term outcome for the airline.

Could one of the Gulf Three buy-up Condor? 

Although he stopped short of identifying any preferred buyer, he said carriers impacted by the war in the Middle East may be prime candidates as they seek to access markets less susceptible to uncertainty in their home region. 

A move by Emirates, Etihad or Qatar Airways would come as no big surprise, not least since two of the ‘Gulf Three’ already own stakes in other airlines. 

For Etihad, it is a 51% majority stake in  Air Arabia Abu Dhabi, while Qatar controls parts of IAG, Virgin Australia and Latam. 

Etihad also has a codeshare in place with the Frankfurt-based carrier.

In addition, the obvious suitor Lufthansa is ruled out of a Condor deal due to competition rules. 

Gerber’s comments come as anticipation builds for a change of ownership of Condor in the coming years. 

The airline is currently owned jointly by the German government and European asset manager Attestor.

CEO sees consolidation as likely outcome

Speaking to the magazine, Gerber acknowledged that Condor’s future is unlikely to remain independent forever. Indeed, the general trend across Europe and further afield is towards airline consolidation.

“Of course, you don’t have to be a prophet to say that Condor will likely join a larger conglomerate,” he told Stern.

“These are … strong carriers who, after their experiences with the US during the Iran-Iraq War, may want to become less dependent on their domestic market and could also be open to partners from other regions.”

Condor rebuilds after Covid

Condor has spent recent years rebuilding its business following one of the most turbulent periods in its history. 

The airline required substantial state financial support during the Covid-19 pandemic as international travel collapsed, receiving government-backed loans to ensure its survival.

The rescue ultimately resulted in the German state – SG Luftfahrtgesellschaft on behalf of Germany’s federal government and the government of the state of Hesse – taking a 49% shareholding in the carrier, while investment company Attestor acquired a controlling 51% stake in 2021 as part of the airline’s restructuring.

Berlin has previously made clear that its investment was intended as a temporary measure.

Condor has undergone extensive transformation since emerging from the pandemic, modernising its long-haul fleet with Airbus A330neo aircraft.

The airline has strengthened its position in the lucrative German leisure market, while the carrier’s distinctive stripey livery has also become a spotter’s favourite. 

Expanding the board in pursuit of network carrier status 

The ownership discussions follow last month’s announcement that Condor was reshaping its management structure to support its transition from a leisure carrier into a broader network airline. 

The airline has expanded its executive management board with the appointment of Pierre Dominique Prümm into the new role of chief commercial officer from 1 August, while Dag Jessel has succeeded Björn Walther as chief financial officer.

Gerber said the expansion of the board signified moves by Condor to become a network airline rather than a purely point-to-point leisure carrier. 

“As Condor continues to evolve into a network airline through the expansion of its city network, the requirements for commercial management, coordination and strategic development are increasing significantly,” Gerber added.

“For this reason, we decided to create the new position of Chief Commercial Officer. During the largest growth phase in Condor’s history, we are deliberately investing where additional management and decision-making capabilities can make a direct contribution to the success of our transformation.”

Featured image: MarcelX42 / Wikimedia Commons