State-trimmed lufthansa must shrink even more than initially planned in the corona crisis.
Due to weak demand and ongoing travel restrictions, at least 150 aircraft in the group’s fleet will be permanently grounded and thousands of additional jobs will be eliminated, the company announced in frankfurt on monday. The mdax group also wants to cut every fifth management position and rent 30 percent less office space in germany.
Until now, lufthansa had planned to reduce the group’s fleet by 100 aircraft in the medium term, which once numbered 760 or, including leased-in aircraft, 800 jets. The number of full-time positions to be cut will also exceed the 22,000 announced so far, the executive board said, without giving an exact figure. Insiders assume that up to 5,000 additional jobs will be eliminated.
It also remained unclear how many of the currently still approximately 128.000 airline employees fear redundancy. Since the beginning of the year, around 10,000 new jobs have been created abroad.000 people leave the airline. Talks about reconciliation of interests and social plans are underway for the german workforce. The management board referred to its goal of creative part-time models and ongoing negotiations with the employees. The company is continuing to work with its collective bargaining partners on appropriate crisis packages to minimize the number of redundancies.
Only massive state aid from the four home countries – germany, austria, switzerland and belgium – totaling nine billion euros prevented the collapse of the highly indebted company. Nevertheless, lufthansa is currently losing 500 million euros in cash every month in the corona slump. This figure is expected to fall to 400 million euros by the winter as savings are made, and to turn positive in the course of the coming year. Lufthansa intends to use the proceeds from partial sales to repay the state’s shareholding.
So far, lufthansa has only concluded a long-term agreement with the ufo cabin crew union. Verdi, which is fighting for ground staff, on monday adopted the criticism of the pilots’ union "vereinigung cockpit" of the management plans for the new "ocean" tourism platform, for which 300 new jobs at a lower wage level than at the parent company have initially been advertised.
Verdi negotiator mira neumaier demanded forward-looking concepts. "Cutting jobs alone will not save the company."The employees of lufthansa technik also had well-founded fears for their future. "Lufthansa as an airline needs a strong lufthansa technical division with its well-trained specialists and collective bargaining structures," neumaier explained, referring to a possible spin-off of the technical division. The sale of the catering subsidiary LSG sky chefs, which had already been initiated, is to be completed this month for europe, according to the group’s management.
This year, after the "flash in the pan" of the summer travel season, lufthansa only expects to offer flights between 20 and 30 percent of pre-crisis levels. Originally lufthansa wanted to fly half of its pre-corona program again by the end of the year. For a quick recovery, management sees the extension of corona rapid tests to the airport as a prerequisite to avoid long quarantine periods.
Due to the low level of intercontinental traffic, lufthansa is now mothballing its large A380 aircraft for the long term, unless they can be returned to the manufacturer airbus. Ten more A340-600 intercontinental jets are also to remain permanently parked. "These aircraft could only be reactivated in the event of an unexpectedly rapid market recovery," the board announced. Seven more A340-600s to be taken out of service immediately. Fleet decisions led to impairment losses of up to 1.1 billion euros in the current quarter.
The corona crisis hit europe’s biggest airline hard, as it did the entire industry in the spring. Global air traffic has come to a virtual standstill in the meantime, and intercontinental traffic has so far only returned to a very small extent. Currently, the group brands lufthansa, eurowings, swiss, austrian and brussels are suffering from the complex entry restrictions imposed by the national states. Only freight still brings money into the coffers.
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