Monday, July 16, 2018
Business

Lufthansa sees growth potential in Tampa Bay

ST. PETERSBURG — Think of Lufthansa as the biggest European tourist to ever visit the Tampa Bay area.

The German airline, which will start serving Tampa International Airport on Sept. 25, is well-known for pampering its customers in business class.

But Don Bunkenburg, a top North American executive with the airline, said Lufthansa was attracted to the region by more than just the promise of filling more business class seats.

There's also the potential here to grow Lufthansa's tourism market.

"We've done well on the business side right now," Bunkenburg said. "But the growing part of international travel is tourism. So we want to be part of that."

Bunkenburg explained why Lufthansa entered the bay area market at Friday's Tampa Bay Export Alliance's 2015 International Town Hall at the Hilton St. Petersburg Carillon Park.

In 2011, Joe Lopano was brought in as CEO of Tampa International to bring more overseas flights to the airport. Lufthansa, the biggest airline in Europe, was his biggest get yet.

But bay area officials coveted more than Lufthansa. They also wanted the airline's link to Frankfurt Airport, one of the world's busiest and most connected hubs. It serves 295 cities in 105 countries.

That's why airport and tourist officials spent three years courting the airline and committed to spending $1.5 million in waived airport fees and incentives to bring Lufthansa here.

"Believe me, there are some regions and some airports that don't care," Bunkenburg said. "You wouldn't believe it. If we add an extra flight or add capacity, there is little interest.

"But there are some that are more proactive and see what the future is."

In Lopano's pitch to airlines around the world, he has re-cast Tampa as the capital of the west coast of Florida, a region with 3.5 million people within an hour's drive of his airport with an annual buying income of $96 billion.

Lufthansa was intrigued. But it still had plenty of questions about this market.

"Gives us the data and help make the business case," Bunkenburg said. "Where do you see the area growing the economy? How are we going to grow our business class? Do you think this market is big enough for us? Are there enough corporate businesses?"

Bunkenburg said there are: Research shows that Germany is the third-largest foreign investor in the bay area.

That was important to Lufthansa, because it showed that the bay area could sustain the business travel that is the airline's bread and butter while it grows its tourism business.

But Bunkenburg said the airline also needed to be confident that the region's economy was growing so that the airline could grow.

Lufthansa will start flying four times a week to the bay area through the winter and then go to five flights a week in summer 2016. But the airline doesn't want to stop there.

"We want to enter a place where we can grow," Bunkenburg said. "Flying four times a week, while good, our goal is to go daily.

"Daily is the most economical way. It creates economies of scale for us. So we look at markets that we can grow."

He said that Tampa International also got a big endorsement when another international carrier, Copa Airlines, started flying there from Panama in 2013.

"If they're choosing a destination then it's been vetted extremely well," Bunkenburg said, "because they have very strict guidelines about profitability."

It's an 11-hour trip from Tampa to Frankfurt. Lufthansa will use Airbus A340-300s that can seat up to 398.

How do early bookings look? Bunkenburg offered no specifics, just a positive assessment.

"We're happy with the bookings," he told the crowd. "We're right on track."

 
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