LH: more savings or “dangerous red zone”

Cost cuts cannot compensate for falling yields.

More savings must be made at Lufthansa or it risks being pushed into a “dangerous red zone”, the airline’s board members have told staff.
The group faces rising costs such as employees’ wages, airport fees and air traffic control charges. Average yields fell by more than 3% in 2014 and cost cuts could not compensate, a letter by Lufthansa board members Bettina Volkens and Karl Ulrich Garnadt reads.
“The bottom line is that these twin trends will take us into the dangerous red zone if we do not take action to correct them,” the letter says.
“The competition knows our cost position and knows that this is an area where we are vulnerable. […] Our cost level is now 30 to 40% higher than that of our direct competitors such as easyJet or Turkish Airlines.”
Lufthansa is planning to expand its regional airline Eurowings as a budget carrier is negotiating with staff to cut costs on those Lufthansa-operated routes that are popular with tourists flying economy.
[image courtesy Lufthansa Group]


Check Also

Avia, Toyota, app, service, technology, connected, fleet, cars, hire, rental, business, app

Avis boosts fleet of “connected vehicles”

The car hire giant will add 10,000 Toyota vehicles to its expanding connected fleet.

Lufthansa, profit, 2017, record, Eurowings, pilots, air Berlin, Swiss, Austrian, Brussels, cargo, Spohr, CEO, contract, outlook, fuel

Lufthansa soars to record profits, up 33%

The German giant’s fortunes are boosted by the Air Berlin bankruptcy and by ending a pilot dispute.

Qantas, branding, marketing, Lufthansa, KLM, United Airlines, livery, design, dreaming, dots, events, special, one-off

Airlines use custom liveries for special events

Qantas, United, KLM and Lufthansa have all revealed eye-catching new livery designs recently.

Boeing, Airbus, A340, dreamliner, goode, space, hidden, room, planes, design, crew, rest, relax

Many planes hide a ‘secret room’

Much of the vacant space on wide-body aircraft goes unused – but not all of it.

Frankfurt, charges, airlines, airport, Main, Hahn, low-cost, Ryanair, Lufthansa, base, aircraft

Ryanair shifts more routes to Frankfurt Airport

Planes are disappearing from Frankfurt-Hahn since the sale of the airport to China’s HNA Group.

Emirates, Ryanair, Flybe, Austrian, Virgin, British Airways, easyjet, American Airlines, airlines, load factor, PLF, fullest, planes, aircraft, environment, business, profit

Airlines with best and worst load factor

Flying planes full makes airlines far more profitable, and it’s better for the environment.