Lufthansa has today (17 March) unveiled its annual results for 2015, giving the first full picture of the effect of the introduction of the €16 distribution cost charge (DCC) at the beginning of September on bookings made through GDS channels.
So what does the airline report?
In the report the airline states, "The introduction of the DCC had a slight adverse effect on bookings, which had, however, no significant negative impact on the earnings position of the airlines."
The airline's 2015 revenue and traffic figures are shown below.
The airline added, "Looking ahead, the new distribution strategy should also extend to a fundamental overhaul of revenue management. The intelligent use of customer data will also add value for customers and open up revenue potential for the Passenger Airline Group. It is expected that additional income of €300m annually will be generated from 2018 onwards."
Overall, earnings (EBIT) at the group rose from €715m to €1,465m, an increase of 104.9%. The development of EBIT at the airline is shown below.
CEO Carsten Spohr said, "2015 was a good year in economic terms. The doubling in the passenger airlines' result is not only due to lower fuel costs, but also to the favorable developments in our passenger volumes and to our capacity discipline. The result also confirms that our focus on quality in both the premium and the point-to-point segment is the right approach. And the very good results from Lufthansa Technik and LSG Sky Chefs further affirm that the Lufthansa Group is on the right track."
The report also outlines the state of legal challenges to the DCC, largely by groups which say that Lufthansa's introduction of the change breaches EU Regulation 80/2009, because the DCC is not levied on its own LHGroup-agent.com distribution channel, or local competition law.
The challenges come from German online agent Unister, the Swiss travel agents' association SRV, the Association for the Promotion and Protection of Fair Competition (VFSW) in Austria and the travel agents trade association in the Austrian Federal Economic Chamber . Two online agents in Greece have also sought a preliminary injunction against the introduction of the DCC.