The Lufthansa Group has outlined its placement plan for the up to forty A320-200 aircraft it plans to wet-lease from Air Berlin (AB, Berlin Tegel).

As part of a capacity reduction plan, Air Berlin yesterday announced it would be placing the jets with rival Lufthansa Group on six-year wet-lease/ACMIO contracts beginning March 26, 2017.

According to the terms of Letter of Intent (LOI) signed between the two parties, Lufthansa will place thirty-five of the aircraft with its Eurowings (EW, Düsseldorf Int'l) low-cost unit. The jets will be based at seven airports around Germany, as well as in Vienna and Palma Son Sant Joan, thus allowing the LCC to 'significantly expand its capacities and strengthen its position in the European point-to-point air transport market.' Eurowings currently operates twenty A320-200s while its Eurowings Europe (E2, Vienna) unit operates a pair.

Five A320s will meanwhile head to Austrian Airlines (OS, Vienna) which will use them to strengthen its Vienna hub operations. Austrian operates seventeen of the type alongside seven A319-100s and six A321-100/-200s.

The aircraft's integration into either carrier's operations will be a gradual process, Lufthansa Group said.

While a final agreement is expected to be concluded in the fourth quarter of this year, its implementation will still require the approval of the partners’ supervisory boards and the relevant competition authorities.

Already, the deal has attracted attention from rival operators including Ryanair (FR, Dublin Int'l). CEO Michael O'Leary recently called for the European Commission (EC) to thoroughly scrutinize the arrangement for all its potential impact on competing carriers.