(Bloomberg) -- Deutsche Lufthansa AG is reviewing whether to cut its daily flight from Frankfurt to Beijing, citing its inability to compete with Gulf airlines that are free to travel through Russian air space.
Europe’s biggest airline group said it’s considering to halt the flights, also citing slow aircraft deliveries and the competitive edge of carriers based outside Europe. China is Germany’s main trading partner, with Lufthansa flights enabling goods and people to flow between Europe’s largest economy and its Asian counterpart.
“European airlines, unlike those from the Persian Gulf and Bosporus, are in an extremely unequal competitive position with China,” Lufthansa said in an emailed statement. “All airlines from these countries benefit from low location costs, low social standards and high government investment in the aviation sector.”
For Lufthansa, any retreat from China would mark a blow to its strategy of dominating business travel in and out of Europe’s most affluent countries. The company has invested heavily in new business and first-class sections, seats often taken by the employees of German multinationals like Volkswagen AG and Siemens AG as well as the staff of family-owned businesses known as the Mittelstand.
Yet business travel has struggled to recover from its pre-pandemic levels as companies push to lower travel expenses and cut their emissions tabs. Meanwhile, delays in the delivery of long-haul aircraft are also pushing Lufthansa to pivot away from Asia to focus on transatlantic routes.
A final decision will be made in October, the airline said. Lufthansa will continue to fly to Beijing from its Munich hub, it said.
A partial retreat would follow similar moves by the likes of British Airways and Virgin Atlantic, which have also pulled back their Chinese offerings.
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