Lufthansa German Airlines will expand its Eastern European destinations to improve access at a time of growing demand in Japan for business trips to that region, according to the carrier’s executive vice president, Thierry Antinori.

“We are rapidly expanding our network in Europe, especially in Eastern Europe. . . . Over the last 12 months, we added 10 new destinations in Eastern Europe” connecting from Frankfurt and Munich, Antinori said in a recent interview, citing Ukraine and Romania as new additions.

The European Union membership is expanding eastward and Japanese companies are investing in the emerging market.

Isuzu Motor Ltd. announced last month it may build a manufacturing plant in Ukraine, and Toyota Motor Corp. recently built a joint plant with PSA Peugeot Citroen in the Czech Republic.

Antinori was in Tokyo last week to attend a match by the German national soccer team and to meet with the carrier’s business partners, including All Nippon Airways Co.

Given Germany’s geographic proximity to Eastern Europe compared with that of Britain and France, Antinori said Lufthansa hopes to lure Japanese business travelers and have a good lead in its contest with other European airlines.

In Japan, where 34 percent of its revenues in the Asia-Pacific region are generated, Lufthansa will continue working closely with ANA in code-shared flights to improve customer convenience, he said. Both Lufthansa and ANA are members of Star Alliance, the world’s biggest airline partnership.

The German carrier boasts 27 flights a week between Japan and Germany, with seven each between Frankfurt and Tokyo, Osaka and Nagoya, and six flights connecting Tokyo and Munich.

When Central Japan International Airport near Nagoya opened in February, Lufthansa raised the number of flights to seven from five, expecting strong passenger demand for the Aichi Expo.

The airport boasts of good connecting times for passengers in transit from domestic to international flights. Code-shared flights with ANA from the airport offer the fastest route to Europe for travelers originating in Sapporo and Fukuoka, Antinori said.

At home in Europe, the emergence of low-cost carriers is threatening the established airlines. Antinori said he is confident Lufthansa is prepared to compete.

“We provide a full range of products to respond to diversifying customer needs,” he said. “We established a low-cost subsidiary (for short-haul trips) called German Wings for price sensitive passengers,” while improving Lufthansa’s first-class and business-class services, he added.

Rising oil prices pushed up fuel costs by 35 percent year-on-year to 458 million euros in the first quarter of fiscal 2005. Antinori said continued cost-cutting is the only solution.

“I don’t expect the (fuel) prices to fall soon, but it’s important to be flexible and adapt” to the situation, he said.

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