Is there overcapacity at Lufthansa? Part C

By Shihal Sapry

Continuing from Part B. Part C involves the largest aircraft in Lufthansa's fleet, the A380-800. We will explore routes flown by the A380 and 747-8I. We cannot include the 747-400 by virtue of it having smaller cabin area. We will compare the most appropriate 747-8I to the A380. We analysed the 747-8I fleet in Part B. It will not be repeated.

Part C

A380-800 and 747-8I.

Lufthansa operates one A380 Layout. We will only consider the 747-8I Layout with the most appropriate Premium Cabin. As per Lufthansa's seat layouts, the A380 seats 509 passengers. The diagrams below offer additional insight. Lufthansa flies the A380 and 747-8I to the same destinations with some being only A380. We are not implying that the A380 will replace the 747-8I or vice versa.

The First Class Cabins are the same, capacity wise and we will not discuss it further.

The 747-8IP was included since it has 14 additional Business Class seats. This shows how Premium dense this 747-8I. Furthermore, the average Business Class Capacity of 83.33 seats indicates that this is optimal Business Class Capacity.

An important point to note. The 747-8I and A380 tend to serve more congested airports and flights were frequency is not desired and sheer capacity prevails. Johannesburg, Sao Paulo are examples.

Lufthansa has shifted 5 A380's from Frankfurt to Munich. These aircraft will fly to the same destinations that they flew to when they were at Frankfurt. They will replace the A340-600's flying these routes from Munich. The A340-600's will fly  the Frankfurt routes that the A380's previously flew. The reason for this could possibly be to optimise demand and revenue. What is interesting, is that the A380 Los Angeles flight from Frankfurt was shifted.  The routes that are no longer flown by the A380 from Frankfurt are Hong Kong, Los Angeles and Beijing. On the Seoul flight, the A380 has been dropped. The A340-600 replaced the A380 on the Los Angeles flight. On the Hong Kong flight, the 747-8I replaced the A380. To summarise the A380 move, the Frankfurt routes now originate in Munich instead of Frankfurt. The original Munich flights now originate in Frankfurt. They are still direct services, with only the origin location in Germany and aircraft type changing.

The following routes are currently/will be flown by the A380 from Frankfurt:

1). New York JFK 2). Delhi (Air India Hub- Star Alliance) 3). Shanghai Pudong (Air China Hub - Star Alliance) 4). Singapore (Singapore Airlines Hub - Star Alliance)

5). Houston (United Airlines Hub - Star Alliance) 6). Miami 7). Bangkok (Thai Airways Hub- Star Alliance. Was upgraded from a 747-400) 8). San Francisco (United Airlines Hub - Star Alliance)

The following routes are currently/will be flown with 747-8I equipment from Frankfurt:

1). Johannesburg (SAA Hub- Star Alliance) 2). Beijing (Air China Hub - Star Alliance) 3). Washington Dulles (United Airlines Hub - Star Alliance) 4). Shanghai Pudong (Air China Hub - Star Alliance) 5). Buenos Aires Ezeiza 6). Sao Paulo Guarulhus 7). Rio De Janeiro 8). Hong Kong (747-8I replaced A380) 9). Los Angeles (United Airlines Hub - Star Alliance on LH450/1) 10). Chicago O'Hare (United Airlines Hub - Star Alliance) 11). Tokyo Haneda (ANA Hub -Star Alliance ) 12). New York Newark (United Airlines Hub - Star Alliance) and JFK 13). Bangalore 14). Boston Logan

We notice that both the A380's and 747-8I's fly to Star Alliance partner hubs. Some of these destinations could be regarded as high demand destinations. Most of these destination airports are congested, where larger aircraft are used in order to increase capacity. There are some destinations like Los Angeles and New York that receive both A380 and 747-8I service. It follows that these aircraft complement each other on this route.

Furthermore, it is possible that there is overcapacity out of Frankfurt. This could explain why the A380's have moved. It follows, that Lufthansa would like to maintain their yields out of Frankfurt, and hence, by deploying a smaller aircraft, they could achieve this. Moreover, demand to/from Munch could be increasing which would warrant larger aircraft. Furthermore, Lufthansa could be generating a larger profit by having these A380's fly from Munich as opposed to Frankfurt. While Munich is not an Air Berlin hub, it is possible that this move would allow for some of Air Berlin's long haul traffic to transfer onto Lufthansa's long haul network, as opposed to the Eurowings subsidiary.

Now we will compare the Non-Premium Dense 747-8I and A380

We note that First Class capacity is the same on both aircraft, even though the A380 is the larger aircraft. We can conclude that the First Class Cabin capacity at Lufthansa is optimal.

The Business Class capacity on the A380 is 2.50% smaller than the 747-8I. The A380 has a massive 62.50% larger Premium Economy Cabin. Economy Class capacity of the A380 is 52.05% larger, representing some 127 seats. The A380 has a comparable First and Business Class Cabin with a much larger Premium Economy Cabin. Hence we can conclude that in this aircraft comparison, the Business Class Cabin capacity is optimal.

The 747-8I's Premium Cabin is 32.97% of total seats with the A380's being 27.11%. Hence, we can conclude that the 747-8I is more Premium Dense with its Premium capacity being 5% larger as a percentage of total seats. The A380 is 39.84% larger, capacity wise attributed to larger Premium Economy and Economy Cabins.

The Standard Deviations(SD) on these aircraft indicate:

1). With Business Class, our SD of 1.41 indicates that the Business Class Capacity of both aircraft are close to each other. 2). The SD for Premium Economy is representative of the A380 having a larger Premium Economy Cabin. 3). The SD of 89.80 for Economy is representative of the A380 having almost 130 additional seats.

We can conclude that First and Business Class Capacity is optimal in this aircraft size segment. We note that the A380 has a much larger Premium Economy Cabin. The Economy Class Cabin of the A380 is also larger. It is logical to deduce that the A380 is used on routes, where the Premium Economy and Economy Class capacity of the 747-8I is too small. Consequently, the First and Business Class capacity of these routes would be appropriate for both the 747-8I and A380. Therefore, we have insufficient evidence to indicate that overcapacity exists in Non- Premium Dense portion of this aircraft size segment(509 seats).

Moving onto the Premium Dense 747-8I and A380

Comments regarding First Class are unchanged.

The Business Class capacity on the A380 is 15.22% smaller than the 747-8I. This is in contrast to the less Premium 747-8I. The A380 still retains its 62.50% larger Premium Economy Cabin. Economy Class capacity of the A380 is even larger at 78.37%, representing some 163 seats. This is almost a 737-800. The A380 has a smaller Business Class Cabin with a much larger Premium Economy Cabin and a significantly larger Economy Class Cabin.

The 747-8I's Premium Cabin is 38.82% of total seats with the A380's being 27.11%. Hence, we can conclude that the 747-8I is almost 43.19% more Premium Dense than the A380. The A380 is 49.71% larger capacity wise attributed to larger Premium Economy and Economy Cabins.

The Standard Deviations(SD) on these aircraft indicate:

1). With Business Class, our SD (larger than the Premium Dense portion) indicates that the Business Class Capacity of both aircraft are further from each other. 2). The SD for Premium Economy is representative of the A380 having a larger Premium Economy Cabin. 3). The SD of 119.50 for Economy is representative of the A380 having almost 130 additional seats.

We can conclude that First and Business Class Capacity is optimal in this aircraft size segment. Moreover, the 747-8I having a larger Business Class Cabin is possibly attributed to the routes it serves. We note that the A380 has a much larger Premium Economy Cabin. The Economy Class Cabin of the A380 is also much larger. It is still logical to deduce that the A380 is used on routes where the Premium Economy and Economy Class capacity of the 747-8I is too small. It follows that the First and Business Class capacity of both aircraft are appropriate. Therefore, we have is insufficient evidence to indicate that overcapacity exists in Non- Premium Dense portion of this aircraft size segment(509 seats).

In conclusion to Part C, the 747-8I is the more Premium Dense aircraft. The A380 and 747-8I appear to complement each other. We were able to deduce this from the routes both aircraft fly. Furthermore, Lufthansa flies their 747-8I's and A380's primarily to Star Alliance partner hubs. Lufthansa and Korean Air are the only airlines that operate both aircraft side by side. Other airlines went with the A380 to offer capacity upgrades and the 777-300ER to replace their fleets. Lufthansa did not operate passenger 777's and with the 747-400 already in the fleet, the -8I was logical. The A380 offered capacity increase over the airline's 747-400 fleet as well as on some of the most congested routes. The aircraft have different roles at Lufthansa. The A380 did not appear to replace aircraft at Lufthansa. The 747-8I flies with a very Premium Dense layout, with an acceptable amount of Economy Class seats. The A380 flies routes where the Economy and Premium Economy capacity of the 747-8I is too small.

The only evidence to indicate overcapacity in this aircraft size segment, is the A380's moving to Munich. This could indicate possible overcapacity out of Frankfurt, but only in this aircraft size segment. We notice A340-600's replacing the A380's on two of the 3 routes. It follows that we have evidence to indicate that possible overcapacity exists in the 509 seat aircraft segment out of Frankfurt. We have insufficient evidence to indicate that overcapacity exists in the Premium Cabins. We must stress that this possible overcapacity applies only to the A380 out of Frankfurt. 

For completeness, this graph has been added. "747-8I P" indicates the Premium Dense 747-8I. "747-8I E" indicates the Non-Premium Dense 747-8I. The 777-X aircraft is too small for the 509 seat aircraft size segment. The 777-X will be discussed in Part D.