The ratings on Deutsche Lufthansa AG (Lufthansa), the Germany-based aviation group, reflect its position as: Europe's second-largest airline in terms of passenger traffic (42.1 billion revenue passenger kilometers in the first half of 2002); The world's second-largest carrier in air freight transport; and The world's leading civil aircraft maintenance and in-flight catering provider. The ratings are constrained by the possibility of further volume and pricing pressures in most of Lufthansa's markets. The ratings factor in the expectation that the group will continue to reduce debt in 2002 and 2003, after good progress in this respect in the first half of 2002. Passenger airline activities generate about 60% of Lufthansa's total revenues. The group benefits from being by far the largest
