ABSTRACT
Cases of alleged predatory pricing in the airline industry are not rare and often follow a similar structure: A new and usually small airline enters a route thus threatening the incumbent operating in that city-pair. It is not the observed market conduct that makes the Lufthansa-Germania case special and hence worth describing, but the way the antitrust authority reacted to it: The incumbent – Deutsche Lufthansa – was sanctioned for its attempt to rule out its competitor – Germania Fluggesellschaft – from the Frankfurt-Berlin-Frankfurt market. The final decision of the German Federal Cartel Office (FCO) is reiterated, followed by an overview of the general way of (economically relevant) reasoning by the antitrust authority. The FCO tried to calculate the pecuniary benefit of some of the auxiliary services. After establishing the allegations, the FCO has to show that the dominant firm reduced its price sufficiently to reach its presumed.
