Germany's Lufthansa eyes defense sector

What was considered almost unthinkable years ago is now being reflected in the job market for military aircraft maintenance.

There's such a need for military aircraft maintenance experts that companies like Lufthansa Technik (LHT) are going to great lengths to train and retrain employees from outside the industry. These new experts often come from suppliers whose jobs have become obsolete due to the switch to electric vehicles.

"Lufthansa Technik, for example, is recruiting mechatronics engineers from the automotive sector in its search for specialists," aviation expert Heinrich Grossbongardt told DW. "They have a good education and are being retrained as aircraft mechanics."

Prompted by Russia's invasion of Ukraine, investments worth billions in new aircraft are creating new business areas — or giving established companies a new boost. That applies to Lufthansa Technik, which recently founded the LHT Defense subdivision.

LHT is the maintenance and repair subsidiary of Germany's flag carrier, Lufthansa. According to its own information, it serves more than 800 customers worldwide and has more than 20,000 employees.

Turning point for Lufthansa

"If I think back 10 years, this would have been almost unimaginable at Lufthansa Technik, let alone in the Lufthansa Group, if you consider things like the environmental, social and governance ranking, the evaluation of large companies in terms of sustainability," said Grossbongardt. "Defense was actually always a no-go."

For decades after the end of World War II and the collapse of the Nazi regime, anything military-related was frowned upon in large parts of German society. Although German armaments technology was in demand abroad, it was a contentious issue in German politics and society.

This changed with the onset of Russia's war in Ukraine and the German government's announcement that it would invest €100 billion to strengthen the German military. 

"Of course, we are also experiencing a reassessment here," said Grossbongardt, "And that's why this is no longer a negative issue for Lufthansa from a Group perspective."

The first step involves the maintenance of five Boeing P-8 Poseidon maritime patrol aircraft, which the German Navy ordered at the end of June 2021. Alongside the US, Australia, India, the UK, Norway, South Korea and New Zealand, Germany is the eighth customer to put the Boeing Poseidon into service this past winter.

Civilian know-how for military pilots

"These aircraft are essentially civilian Boeing 737s, i.e. completely normal commercial aircraft into which military systems have been installed," said Grossbongardt. And Lufthansa, he pointed out, has a lot of experience in the maintenance of these Boeing 737s.

"The question was asked very early on: 'Who can do this in Germany?' And there's no getting around Lufthansa Technik, especially as it is already involved through the maintenance and outfitting of German government aircraft."

It makes sense, he said, for the Bundeswehr and for Germany to get involved in maintenance, adding that it would be much more expensive if the Bundeswehr were to build up these capacities from scratch and stock up on the necessary spare parts.

"Lufthansa can simply draw on what it already has, and it also makes sense for the airline because it ultimately creates jobs in Hamburg," said Grossbongardt.

Internationally, he said, Lufthansa Technik enjoys an excellent reputation.

"As the Americans like to say, LHT is the 800-pound gorilla in the commercial aircraft maintenance market," he said. "This means that Lufthansa Technik is one of the world's absolute leaders in the field of technical support for commercial aircraft, engines and all components. Nobody can get past them that easily."

Helicopters also on the radar

In mid-May, German Defense Minister Boris Pistorius visited the US defense company Boeing in Philadelphia, which, in addition to the order for the Poseidon naval aircraft, has also received an order for 60 CH-47F Chinook heavy transport helicopters from Germany. Lufthansa also wants to get involved in the maintenance and spare parts procurement business.

In addition, LHT wants to participate in the maintenance of the 35 F-35 stealth bombers ordered by the German Air Force from US manufacturer Lockheed.

And when NATO replaces its AWACS radar aircraft with the new E-7 type over the next few years, LHT CEO Sören Stark believes there is a good chance the company will not only get involved in the maintenance business for the E-7.

"Understanding and supporting new aircraft and their technology in the shortest possible time has been part of our DNA for decades," Stark told the business daily Handelsblatt. "We could also carry out the modification of civil Boeing 737s into NATO E-7 aircraft in Hamburg in close coordination with Boeing."

Jobs for specialists in Germany

This new chapter for LHT provides a range of new openings and opportunities. This time, the new jobs will not be created at Lufthansa Technik locations in Malta, Sofia or Manila, but in Germany.

Bidding for the maintenance of the new NATO radar aircraft is also a smart move, from Grossbongardt's point of view. Here, too, LHT can put its experience with a common civilian Boeing jet to good use.

"The successor model, the E-7 Wedgetail, is based on the civilian Boeing 737. And once I have my foot in the door there, there is further potential in other areas regarding NATO," said the aviation expert.

LHT's Stark has ambitious plans. Turnover is set to increase from €6.5 billion ($7 billion) to more than €10 billion by 2030 and he wants to increase profits from just under €630 million to over €1 billion. While those targets are ambitious, they are not unrealistic.

"I see very good opportunities for Lufthansa Technik to act as prime contractor for the US-based programs," aviation consultant Michael Santo from the consulting firm H&Z was quoted as saying in Handelsblatt.

Grossbongardt thinks it's unlikely LHT would go beyond maintenance work on military aircraft technology and engines in the future. "Lufthansa Technik will never go into weapons technology, it has no expertise in that area," he said.

Instead, he expects LHT to bring partners on board for this area.

"Lufthansa Technik would then be the main contractor and take care of the engine and aircraft. And everything that has to do with weapons electronics, weapons and radar systems would be handled by a partner," he said.

This article was originally written in German.