Some 10,000 pilots working for Lufthansa Group airlines across Europe say they are willing to take a 45 per cent pay cut through to the end of June in an effort to stave off job losses at the embattled airline. The measure, if implemented for Lufthansa’s 4,000 directly employed pilots in Germany, would save approximately €350 million. The Lufthansa Group is currently losing €1 million every single hour because of the Corona-crisis.
Lufthansa chairman, Carsten Spohr has, however, cautioned the airline might need to make 10,000 employees redundant as it prepares to become a “different and smaller” airline as it emerges from the COVID-19 pandemic. Spohr issued the grim warning in an update to investors ahead of a virtual investors day on May 5.
He suggested Lufthansa would reduce its fleet size across the group of airlines – which also includes Eurowings, Austrian Airlines, SWISS and Brussels Airlines – by 100 aircraft to match what it thinks will be the new demand for several years to come at least. Lufthansa has previously earmarked a slow recovery stretching into 2023.
“We currently expect that the global demand for air travel will no longer grow as dynamically in the long term as it did in the past years. People’s travel behaviour will change, both in terms of leisure and business travel,” Spohr told investors.
The airline group has already received assurances of state aid from the Swiss government and is in continuing talks with the Austrian, Belgium and German governments to secure more taxpayer-funded bailouts. Sphor said the bailouts were needed but “government management” was not.
“We are currently facing the greatest challenge of our recent history,” Sphor wrote. “We are fighting for the future of this company and the future of the roughly 130,000 employees of the Lufthansa Group.”
The airline is currently only flying around 3,000 passengers per day – a drop of 99 per cent and the same number it flew back in 1955. Around 700 aircraft out of a total fleet size of 760 aircraft have been grounded and Austrian Airlines and Brussels Airlines have suspended operations altogether. 80,000 staff are currently on reduced short time work partly funded by national governments.
Sphor said that no one knew what the “new normal” would look like and there is continuing “uncertainty as to when operations can be resumed”. Lufthansa is planning to spend the entire summer period largely grounded with a possible limited resumption of normally scheduled flights in the autumn.
When more people do start to fly again, it’s likely that they’ll need to wear a face mask. Lufthansa has made the wearing of face masks mandatory for all crew and passengers and has said the safety measure will replace social distancing measures like blocking the middle seat. Initially, the requirement will be enforced though August 31 but is likely to be extended beyond this date.
