Lufthansa Group is planning some major changes to how it does business, in order to both increase profitability and improve customer satisfaction. That combination always makes me a bit skeptical, especially when it’s coming from Lufthansa Group.
Lufthansa’s controversial “Matrix Next Level” strategy
Europe has three major global airline groups. One of those is Lufthansa Group, which includes Lufthansa, SWISS, Austrian, Brussels, ITA, Eurowings, Discover, etc. While the airline group is based in Frankfurt, the individual airlines have a fair bit of autonomy in terms of their strategy.
Lufthansa Group CEO Carsten Spohr is looking to change that, in a project that’s called “Matrix Next Level” (lol?), which could be implemented as of early 2026. German publication Handelsblatt reports on an internal memo making its way around Lufthansa Group airlines, whereby Lufthansa lays out its plan to increasingly control decisions for the entire group from Frankfurt.
This is particularly controversial at SWISS, which is one of the group’s best performing airlines, as a fair amount of control of the airline has been left to management in Zurich. The intent is increasingly for strategic decision to be made by Lufthansa in Frankfurt, including for functions like route planning, sales, and loyalty. Meanwhile the inflight experience would be left within the control of the individual airlines. Spohr believes that this realignment is needed in order to improve profitability and customer satisfaction.
Obviously the individual airlines largely aren’t too jazzed about this concept. For example, a SWISS spokesperson has confirmed that “the Lufthansa Group is reviewing its organizational structure together with the Group airlines,” and that it’s examining “in which areas we can benefit even more from the synergies of a strong group”.
But a spokesperson also emphasized the importance for independence, saying “it is important for us to say that Swiss will remain a strong airline,” and that “in future, it should continue to be able to make its own decisions about its services.”
My take on Lufthansa Group’s management strategy shift
In theory, there’s nothing wrong with centralizing more management functions within an airline group, given the potential synergies. That being said, I have a few thoughts…
First of all, I’m always a little skeptical when the claimed motivation for something is to both increase profits and customer satisfaction. It’s rare that those two things go hand-in-hand, at least at an airline like Lufthansa.
Second of all, purely in terms of track record, I can’t help but be a little skeptical of centralizing more functions in Frankfurt. It honestly amazes me that we haven’t seen an overhaul of Lufthansa Group management, given the repeated shortcomings we’ve seen over the years.
Based on what record is it believed that decisions could be better made in Frankfurt than at other bases? For example, the reason that SWISS is having to install a 3,000-pound weight on its A330s is because of Lufthansa Group management, and not because of SWISS management.
For that matter, so many functions are already centralized with Lufthansa Group. This includes fleet planning (Lufthansa Group orders planes centrally), loyalty (Miles & More is one program for member airlines), and even route planning (so much planning happens as part of joint ventures, and there’s already a lot of coordination).
So I can’t help but but be a bit worried that if even more functions are controlled by Lufthansa, that just can’t be good for passengers. Anyway, we’ll see how this all plays out…
Bottom line
Lufthansa Group plans to centralize more management functions in Frankfurt as of early 2026. The idea is to leave less control with individual airlines of the group, like SWISS, and increasingly have decisions made at the airline group level.
In theory, there are no doubt synergies there, and I could see upside. The challenge is that it’s hard to have much faith in Lufthansa Group management, given its track record with so many things in recent years.
While the claim is that the goal is to increase profits and customer satisfaction, I would speculate that this development might help more with one of those than the other.
What do you make of Lufthansa Group’s management centralization plans?
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