The Daily Parker

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Germany tells Emirates to raise prices

From the Economist's Gulliver blog:

The Germans said in a letter to the Dubai-based carrier that under European law it was not allowed “to engage in price leadership” on routes from Germany to non-EU locations. Emirates, which condemned the decision as “commercially nonsensical”, responded by raising prices by 20% on some routes.

Andrew Parker of Emirates told the Financial Times, "We are adamant this is selective and clearly an attempt by Lufthansa [Germany's national carrier] to pursue Emirates versus a legitimate policy."

Yes, but on the other hand, it would not surprise me to learn that Emirates had priced the seats as a loss-leader to undercut its competitors, including Lufthansa. Regardless, this seems a good example of the African proverb, "When elephants wrestle, the grass suffers."

At this writing, a 7-day advance, Saturday-to-Thursday (discount) business class ticket from Frankfurt to Dubai was €2,245 on Emirates and €2,954 on Lufthansa. I can see why Lufthansa (and the German goverment) might suspect anti-competitive behavior...but still, raising prices for everyone doesn't seem sporting.

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