Lufthansa Group prepares for more drastic cutbacks in fleet and global workforce

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dpatop – 15 March 2020, Hessen, Frankfurt/Main: Numerous Lufthansa aircraft are parked on the extensive grounds of Frankfurt Airport. Lufthansa has been severely affected by the severe slump in demand caused by the novel corona virus and has cancelled the lion’s share of its flight offerings for the coming weeks. Photo: Frank Rumpenhorst/dpa

Lufthansa Group’s original plans to divest 100 aircraft and cut 22,000 jobs will not be sufficient to tackle the coronavirus pandemic. The group is now preparing to make more significant cuts to its fleet and subsequently to its workforce. 

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Carsten Sporh, CEO Lufthansa Group

In an internal communication, Lufthansa Group CEO Carsten Spohr said that 2020 passenger levels were at below 20% compared to previous year. “We hope to reach 25% by year-end,” said Spohr, “Lufthansa is currently burning €1 million every 90 minutes, meaning that our state aid gives us a time frame of 18 months. We hope to reach to 2019 revenue levels by 2025, but due to the drastic decline in business travel this target remains highly uncertain.”

Next week, the airline group will decide on the future of its fleet. Spohr said that only one four-engined jet has a future: the Boeing 747-8. In April, Lufthansa already announced that six Airbus A380s and seven A340-600s, as well as five Boeing 747-400s, would be permanently decommissioned. In May, Air France already decided to permanently ground its A380 fleet, a move that Lufthansa may now follow by grounding the entire A380 fleet.

During next week’s board meeting, the future of the Boeing 747-400 and Airbus A340-600 fleet will also be discussed. The decision to phase out these aircraft is taken based on the environmental as well as economic disadvantages of these aircraft types.

At Austrian Airlines, the Boeing 777 and Boeing 767 aircraft will disappear as “these aircraft don’t have a future.”

As cargo business is booming, Lufthansa Cargo will keep three MD-11 until mid 2021. The other MD-11’s will be phased out shortly.

Lufthansa is in talks with Airbus to speed up the delivery of the Airbus A350, to replace the older, more fuel-thirsty models. These twin-engine jets might be leased rather than bought to preserve the cash-position of the group.

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