Munich airport eyes higher-yield international passengers

BERLIN, March 10 (Reuters) - Munich airport is not planning to follow the example of Frankfurt by launching special discounts to attract low-cost carriers, but wants to instead focus on higher-yield international traffic, the hub's chief executive said on Friday.

Munich airport is Germany's second-largest and expects to increase passengers numbers 4 percent to 44 million this year, Michael Kerkloh told Reuters.

"We want to focus on our role as a major hub in Europe, that brings new profit opportunities," Kerkloh said on the sidelines of the ITB travel fair in Berlin.

Frankfurt airport is seeking to make up for falling passenger numbers by attracting low-cost carriers, but big incentives it is offering for new routes to lure Ryanair have irked its main customer, Lufthansa (Xetra: LHAB.DE - news) .

Kerkloh said Munich airport, which gets 55 percent of its traffic from Lufthansa, was not planning any new discounts to attract budget carriers.

"We have normal incentives to help support new routes. We want competition between airlines but it must be fair," he said.

He said the federal state of Bavaria's strong economy meant locals had more money to spend on travel, while Munich could serve as a gateway to Germany and Europe for passengers coming from Asia.

Still, the number of low-cost routes operated from Munich is set to rise as budget flying becomes more prevalent in Germany and Europe. Lufthansa's budget unit Eurowings is starting flights from Munich and said earlier this week that bookings there had been above expectations.

"The proportion of low-cost carriers will rise. It's currently at about 4 to 5 percent, while it's at 20 percent for similar airports like Amsterdam," Munich Airport's Kerkloh said.

Ryanair chief marketing officer Kenny Jacobs said on Friday that the Irish low-cost carrier would not rule out flying out of Munich but that it was too expensive and restrictive at the moment.

"We've more than doubled in size without Frankfurt, Munich isn't a must. Eurowings going in there doesn't make us speed up our thinking or our desire to go in there," he said. (Reporting by Victoria Bryan and Peter Maushagen; Editing by Maria Sheahan)