The European aviation industry could soon get a lot more competitive

07.10.2016 | 09:49

Etihad, the Gulf airline that owns more than 29 per cent of Germany’s second biggest airline, Air Berlin, is in talks with holiday giant Tui about creating a new European airline group.

The two are discussing combining the “touristic” operations of Air Berlin with Tui’s German “Tuifly” aviation arm. The new entity would serve a “board” network of operations, the companies said in a joint statement, across Germany, Austria and Switzerland.

Tui, Etihad and Air Berlin intend to finalise an agreement in principle “in due course” although any deal will be subject to the usual regulatory approvals.

Tuifly and Air Berlin already have a relationship; the former already operates aircraft for the latter under a “wet-lease” agreement, whereby aircraft and crew are effectively seconded to the other carrier.

News of the talks comes after Air Berlin last month announced plans to slash its operating fleet and devote 40 aircrafts to running services for rival German carrier Lufthansa.