Lufthansa Bets on Mobile Access, New Class to Narrow Luxury Gap

Photographer: Ralph Orlowski/Bloomberg
Lufthansa is trailing competitors including British Airways by more than a decade in offering four travel classes, while Gulf and Asian carriers are raising the bar in on-board service quality and entertainment.

Deutsche Lufthansa AG (LHA) will allow passengers to use their own mobile devices to view films and add a new premium economy class before the end of the year as it seeks to counter rivals that offer more luxurious services.

The new class, to be rolled out from November, will have as much as 50 percent more room than coach and be added to the entire long-haul fleet by the end of 2015, while an on-board server will allow laptops, tablets and smartphones to access movies, TV shows, music and games for free from this summer.

Lufthansa is trailing competitors including British Airways by more than a decade in offering four travel classes, while Gulf and Asian carriers are raising the bar in on-board service quality and entertainment. The Cologne-based carrier is responding as it targets a five-star rating with airline-review firm Skytrax by 2015, a status no western airline holds.

“Our premium economy is a stand-alone travel experience, not just economy plus,” Jens Bischof, who heads sales at the passenger-airline unit, said in Berlin, putting demand at 1.5 million tickets a year. “About 70 percent of business travelers sit in economy, so we think there’s great up-sell potential.”

Europe’s second-largest airline will offer its new entertainment system on flights to the Middle East, north Africa and former Soviet states, deploying it first on 20 Airbus Group NV (AIR) A321 narrow-body planes, Bischof said.

‘Interference’

The system, developed by Lufthansa, has so far been ordered only by EL AL Israel Airlines (ELAL), and Qatar Airways Ltd. Chief Executive Officer Akbar Al Baker said today his company will be sticking with hard-wired inflight-entertainment systems.

“Imagine you have 200 passengers all turning on their tablets, what interference it would have,” Al Baker said in Berlin, where airline executives were attending the ITB travel fair. “We’d prefer not to introduce something like that.”

Premium economy will debut on Boeing Co. 747-8s rather than the Airbus A380 as once planned, since the superjumbos are currently being fitted with flat-bed business berths, delaying their introduction from the summer, Bischof said.

Tickets for the new class, which will also offer better food served on porcelain, will cost about 600 euros ($824) more than an economy fare, with the seats occupying 10 percent of long-haul capacity or 21-52 berths per plane, depending on model. Economy seats will be removed to accommodate them.

BA announced a premium economy offering in 2000, as well as flat beds in business. Air France-KLM Group (AF), Europe’s largest airline by traffic, is also getting a makeover ranging from high-end seats to bigger entertainment screens.

To contact the reporters on this story: Richard Weiss in Frankfurt at rweiss5@bloomberg.net; Benedikt Kammel in Berlin at bkammel@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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