January 29, 2004

Lufthansa Systems today announced that the "S3 - Security from Seat to Seat" consortium headed by the IT service provider has won the bid to participate in Germany's nationwide Aviation Research Program 2003-2007. The program is being sponsored by the Germany Federal Ministry of Economics and Labor (BMWA). This marks the third time that the Ministry has provided federal funding for innovative projects.

Called "S3 - Security from Seat to Seat", the project is run by Lufthansa Systems and four other partners. Its primary task is to collaborate with airlines and airports to further improve security standards in the passenger handling process. The goal of the project, which will run until the end of 2007, is to bring about procedural improvements, accelerate processes, and significantly increase passenger comfort by optimizing existing and implementing new methods and security technologies.

Security measures, which have been stepped up considerably since the events of September 11, 2001, are one of the most cost-intensive aspects of airport operations. Process optimization in this area can lead to significant cost savings. The ten largest airports in Germany spent around EUR 330 million in the year 2001 on passenger security checks alone. These facts, along with further improvements in security checks, show clearly
why the BMWA is investing its subsidies in this area, with the proviso that the results of the
project are commercially exploited later on.

Lufthansa Systems, one of the world's leading IT service providers for the airline and aviation industry, is heading the consortium and will develop technologically innovative and economically efficient solutions in cooperation with its consortium partners. The consortium also includes RAND Europe, a company renowned for its benchmark studies. RAND Europe will offer support in methodology development and project management and
provide the data for simulations. SAT Simulations und Automations-Technologie GmbH,

Germany's leading simulation consultant, is also represented in the consortium and will contribute to the creation of simulation models, while Dresden University of Technology will focus primarily on the aspect of contingency management. The fourth partner in the consortium is the German Aerospace Center (Deutsche Zentrum für Luft- und Raumfahrt), which will handle the integration of the simulators developed by the various partners.

"We are excited to participate in this national initiative and head the consortium. Naturally, we will bring all of our extensive experience and industry-specific process knowledge to the undertaking so that, together with our partners, we can lead the project to success. The potential benefits of joint activities such as this are twofold: they generate innovative synergies and enable us to make valuable new contacts, which we definitely appreciate," said Dr. Peter Franke, CEO of Lufthansa Systems Group GmbH.

Note to editors:

Lufthansa Systems is one of the leading IT service providers for the airline and aviation industries worldwide. As systems integrator, the wholly-owned subsidiary of the Lufthansa Group covers the entire range of IT services, including consulting, development, implementation and operation. Lufthansa Systems provides its IT infrastructure and operations services to a variety of industries. Headquartered in Kelsterbach near Frankfurt/Main, Germany, the company has branches in Germany and thirteen countries and employs about 4,200 people worldwide.