Lufthansa German Airlines and U.S.-Germany Aviation Relations

lufthansaThe Challenge 
The aviation treaty signed by the United States and Germany at the end of World War II created a structure in which the benefits of aviation rights were heavily tilted in favor of U.S. airlines.  For a variety of reasons, political and otherwise, successive German governments were reluctant to try to re-negotiate a more balanced aviation treaty with the U.S. Government.  The German airline, Lufthansa, was heavily disadvantaged, competitively and commercially, by that aviation treaty.  Garfinkle was asked to help Lufthansa develop an approach to get both its government and the U.S. Government to enter into a new, “modern,” balanced aviation agreement.

The Strategy 
The goal was for the parties to agree to a revised and balanced aviation agreement.  Garfinkle’s strategy involved creating a trigger to get the U.S. to the negotiating table. At the same time, he educated the German Government about how the negotiating process would work and prepared them for possible outcomes.  Success depended upon securing “buy in” from Lufthansa’s Supervisory Board and several agencies of the German Government.

The Advocacy 
Working with a small team of senior Lufthansa executives, Garfinkle developed “white papers” to present to both the U.S. Government and the German Government to demonstrate the current unfair imbalance in aviation rights for Lufthansa as compared to the benefits that were accorded U.S. carriers under the treaty. The white papers explained how the current aviation treaty needed to be modified to create balance, and also allow for a proposed alliance between Lufthansa and United Airlines.  This alliance was the forerunner to the development of the Star Alliance, which was a critical aspect of the new Lufthansa (and United) global strategy.  The white paper advocacy also included a media campaign in the U.S. and Germany, which was developed by Garfinkle and the Lufthansa team.

As Garfinkle had anticipated, the U.S. Government ultimately agreed to renegotiate the aviation treaty.  Throughout the negotiations between the U.S. and Germany over the new treaty terms, Garfinkle communicated with both government delegations and Lufthansa senior management about acceptable terms and terms unacceptable to the German Government and Lufthansa.  Garfinkle also kept the German delegation current on U.S. attitudes, likely reactions to German positions and what the German Government response should be.

The Result 
A new U.S.-Germany aviation agreement was signed.  It was the most important “Open Skies” agreement signed by the U.S. Government at that time.  It restored competitive and commercial balance for Lufthansa and enabled Lufthansa and United to team up and, right thereafter, form the Star Alliance, which today is the largest global airline alliance.

tagline

Home Blog Lufthansa German Airlines and U.S.-Germany Aviation Relations