Lufthansa Technik solidifies its position as the world’s market

The Hamburg-based Lufthansa Technik Group, one of the world’s leading providers of technical services for aircraft, ended fiscal 2010 with a slight increase in revenue in a market in which demand is now also rising. Revenue grew by 1.4 percent to EUR 4.02 billion. However, the company’s result did not quite meet the record level of the previous year owing to extremely intensive price pressure and customer orders that were withdrawn. The annual report of the 21 companies consolidated under the Lufthansa Technik name shows an operating result of EUR 268 million for the Group.

“Lufthansa Technik survived the economic and financial crisis relatively well through increases in efficiency, high utilization of flexible working hours, and process innovations,– said Lufthansa Technik AG’s CEO, August Wilhelm Henningsen, on March 22, 2011 in Hamburg. “Operatively, the smooth introduction of Lufthansa’s new Airbus A380 flagship was a particular high point for us in 2010, and we’ve continued to solidify our position as the world’s market leader in the global maintenance, repair and overhaul (MRO) business.

“During the second half of the year in particular, we were able to continue our course for growth and increase our business with customers outside the Lufthansa Group by 3.3 percent. However, since price pressures remained extremely intensive and some customers postponed or even withdrew orders, we were, as expected, unable to meet the high levels of the previous year.– The decline in business amounted to 15 percent.

Lufthansa Technik now looks after 750 customers and a total of 2,055 aircraft around the world. In 2010, the Group was able to win 34 new customers and conclude 460 new contracts. Total revenue for fiscal year 2010 amounted to EUR 504 million (+ 2.3 percent).

“The most important cornerstone of Lufthansa Technik’s robust competitiveness on the world’s market is our international network, which has 26,000 employees at 30 facilities. More than 13,000 alone outside Germany," said Henningsen. He noted that the company’s sales staff tailors its activities ever more closely to the needs of the market and that cooperation within the Group’s companies has been tightened even more.

For example, the N3 Engine Overhaul Services unit in Erfurt can now also work on the Rolls-Royce Trent 900 engines used in the Airbus A380. Lufthansa Technik Shenzhen in China has extended its product portfolio in the area of engine components, and in its tenth year of operation, Lufthansa Technik Philippines in Manila has added cabin conversions and special new services for low-cost airlines to its portfolio of services.

However, Henningsen also stressed that Germany would remain Lufthansa Technik’s most important production site, as investments in Frankfurt for maintenance of the A380 and in Hamburg for the component and engine areas clearly demonstrate.

“However, at all of our sites around the world, we can only profit from the market’s growth when our unit costs are competitive. We’ve made good progress with our projects to reduce expenses and improve efficiency and flexibility, yet we intend to continue our efforts in these areas rigorously. But that’s why we’re convinced that this year as well, we’ll continue to play a successful role in an MRO market development that is, once again, positive.