France historically has an extremely centralized and partly state-owned economy. Therefore, there are rather larger corporations proportionally in state ownership, and little independent middle class. Germany is much more market-oriented and more open. Nevertheless, the Government, which allegedly intervenes “in the interest of the little people”, often causes the opposite with its actions. In the short term for the optics one can perhaps save jobs. In the long term, however, that can look very different.
Today we will give an example with the insolvent second largens german Airline Air Berlin. German politicians have done everything in their power to create the quote “a national champion in the sky”, which is at the very top of the international league (No 1 Lufthansa). Part of the Air Berlin employees will probably be accommodated at Lufthansa and easyjet, but probably at significantly lower salaries – because here are no old contracts taken over, but recruited at the insolvent Air Berlin at the door set staff at Lufthansa.
Dramatic income losses are to be expected, and a good part of the workforce is completely on the road. But yes, the policy was not only important to create a champion – also wanted to make with it´s support for Lufthansa so yes, that the Air Berlin employees quickly come back in bread and rolls. Question: Given the great need for flights within Germany, would not the Air Berlin employees have received equally grotesquely bad new contracts from other providers?
But that is not the worst Issue. With the support of Lufthansa, the german Government also wants to maintain the supply of intra-German connections. There was also this bridging loan for Air Berlin of 150 Millionen Euros, so that the machines could continue to fly for some weeks – until the bankruptcy was then completed. Now there is a huge gap between supply and demand, and ohhh miracle, the Lufthansa prices in the domestic German air traffic increase very clearly, according to investigations of price portals.
The call for the Federal Cartel Office is getting louder, which wants to look at the matter now. Lufthansa recently commented on the newspaper “WamS” that there are no secrets. About 95% of the flights did not become more expensive. What is rumored about price increases, was “proven” not applicable, as told by Lufthansa. If there are higher prices, then these are isolated cases – with an investigation of the antitrust officers Lufthansa says the have no problems. Well, probably the price portals who saw the increasing prices are always looking for these 5% of the routes that have become more expensive – there are coincidences …
Deutsche Bahn as an alternative
But stop. If Lufthansa as a monopolist in domestic German air traffic (allegedly) is so much more expensive then before the Air Berlin Bancruptcy, then you can not change to the Deutsche Bahn, the german Government owned Rail Traffic provider? Especially now that new routes have been completed, for example between Berlin and Munich, which significantly reduce travel times! A great thing. So, everything going from Airplane to the train? Well, who reads the latest statements from the Deutsche Bahn, who sees: It is currently posing an indictment, and stamps its own goals for punctuality and reliability. Untenable!
In the current year, 80% of the long-distance trains actually wanted to reach their destination on time – not feasible. You are not there yet, where you want to go, so the Deutsche Bahn actually told the newspaper “SZ”. And remember: the winter with all its for the DB as always unpredictable problems is just around the corner. But the state-owned Deutsche Bahn, maybe there’s at least cheaper prices? Well, you have to disappoint.
Of course that would be too abstruse conspiracy theory. Just at the time when at the monopolist Lufthansa no space is free, and prices (supposedly) increase sharply, the German Rail also increased their prices on first of December. According to the train travel blog, which took a closer look at the new fares, you will pay 1.9% more in the second class starting December first, and 2.9% more in the first class. In addition, the so-called differentiated flex price will continue, in which the prices for each day of travel may vary. According to Deutsche Bahn, the system has proven itself – but business travelers are of a different opinion.
In plain English: Similar to Lufthansa? Rising demand causes rising prices? The conclusion? The Government wanted to save jobs after the Air Berlin bankruptcy, create a big strong champion, and keep the airline network alive. The built or promoted a de facto monopoly with (allegedly!?) rising prices for customers. And when changing to Deutsche Bahn (yes, still in state ownership), prices are also rising – not to mention train cancellations, overcrowding, and imminent winter chaos. The customer is the stupid!
Note: Especially in railway companies, examples abroad show that privatizations bring dramatic disadvantages. So: Simply privatize everything does not lead to the goal. But my goodness: If the German Government is monopolizing the air traffic, as an operator of the rail traffic it can lower the prices for some month? Just such an idea in the sense of compensatory justice for the air travelers, with their (annoying?) demand drive up the ticket prices in the sky. But no, dream aside, falling rail prices will not come – because Deutsche Bahn, which must indeed invest sooo much in the coming years…
Airbus A380-800 from Lufthansa. Foto: Konstantin von Wedelstaedt – Gallery page http://www.airliners.net/photo/Lufthansa/Airbus-A380-841/1891305/L Photo http://cdn-www.airliners.net/aviation-photos/photos/5/0/3/1891305.jpg / GFDL 1.2