The Niki subsidiary of now-defunct AirBerlin is to join IAG as part of the Vueling LCC operation. The new ownership deal comes just a couple weeks after Niki halted operations. Details around the resumption of flights remain unclear but presumably IAG/Vueling will work to get that back quickly, though likely not immediately to 100% utilization given the lower demand of the winter season.
Read More: The collapse of Niki
Niki’s assets were initially planned to be sold to the Lufthansa Group during the bankruptcy proceedings. That deal collapsed under concern from European regulators and insufficient divestitures from the Group. Former owner and founder Niki Lauda also expressed interest in regaining control of his former airline but the IAG offer pleased the AirBerlin administration team more. And, quite frankly, the Vueling integration is far more likely to result in an operation that survives.
International Airlines Group (IAG) is to buy assets of the Austrian airline NIKI, which was formerly part of the Air Berlin group, for €20 million and provide liquidity to NIKI of up to €16.5 million @vueling @flyniki @orf @simply_aviation @simply_aviation
— Kurt Hofmann (@HofmannAviation) December 29, 2017
IAG’s win here also brings the group back a significant connection flow on the European continent. Madrid, Barcelona and London are poorly placed for most connecting passengers, particularly compared to Frankfurt, Munich, Zurich, Paris and Amsterdam. Then again, for point-to-point travelers within Europe the number of nonstop flights available through LCCs continues to grow. That mitigates the value of the connection hubs in many instances.
Vueling is also not a oneworld member, reducing the value of this transaction to partner airlines. Nor is Vueling a member of the transatlantic joint venture of British Airways, American Airlines, Finnair and Iberia. In that sense the deal is far better for IAG and its “local” airlines than the broader partnerships. Especially compared to AirBerlin’s full oneworld membership status (and Niki’s associate member status), even if the carrier did skirt some rules around lounges and such.
The assets include up to 15 A320 family aircraft and an attractive slot portfolio at various airports including Vienna, Dusseldorf, Munich, Palma and Zurich.
The new company plans to employ approximately 740 former NIKI employees to run the operation.
— Kurt Hofmann (@HofmannAviation) December 29, 2017
The overall Niki fleet is small; it is a fifth the size of Vueling’s overall operation. Still, a 15 aircraft fleet based in Austria offers the company significant expansion opportunity, as does the operational base and existing Niki route structure and the landing slots portfolio. The aircraft are relatively similarly configured to Vueling’s so that should make the integration easier. Presumably the Niki aircraft will also be added to the Inmarsat EAN inflight connectivity order as well.
Vueling Austria will operate as a newly formed subsidiary of Vueling and run as a separate company from the Barcelona operation. That’s not great for operational efficiency but for the ~740 employees who get to keep their jobs it is very good news.
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I wonder if namesake Niki Lauda will be involved at all, even if he didn’t manage to regain control for the third (?) time.
I can’t see how he would be involved in a manner that is useful to IAG/Vueling. They don’t need his money and I doubt they want him as part of the management team.
Marketing at best.
I wonder how long Niki remains as a brand.
About as long as it takes to paint the planes. Or less. No need for it and it doesn’t help the company in any way.
Agree, unless there are financial liabilities, labor issues, or similar “roadblocks.”