Lufthansa: mediation less than ideal in cabin crew row

Wed Sep 5, 2012 3:16pm EDT
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By Victoria Bryan

FRANKFURT (Reuters) - German airline Lufthansa (LHAG.DE: Quote) said it would be open to mediation but held out little hope of success as a Friday strike threat loomed in an escalating fight with cabin crew over pay and conditions.

Lufthansa Passenger Airlines executive Peter Gerber told journalists on Wednesday he saw mediation as a "less than ideal solution", as it would take a third-party mediator too long to understand the complexities of Lufthansa's pay structure.

Talks between Lufthansa and trade union UFO broke down a week ago, having failed to result in an agreement for 13 months, and have so far not resumed, with both sides adamant the other should make concessions first.

UFO, which represents around two-thirds of Lufthansa's 18,000 flight attendants, is demanding a 5 percent pay increase and guarantees that jobs will not be outsourced to temporary workers, while Lufthansa has offered a pay increase of 3.5 percent in exchange for longer hours.

The union has threatened to hold a 24-hour strike across Germany on Friday if Lufthansa does not agree to mediation, after a second day of rolling strikes lasting up to 11 hours on Tuesday already resulted in the cancellation of over 350 flights and left 43,000 passengers stranded.

Some analysts have estimated that such widespread industrial action could cost Lufthansa as much as 50 million euros ($63 million) per day, though the hit could be limited by re-booking passengers on its other carriers like Swiss and Austrian Airlines and by leasing aircraft complete with crew.

Lufthansa is under pressure not to give in to UFO's demands as it tries to sharply cut costs as part of a plan to improve annual earnings by 1.5 billion euros ($1.9 billion) by 2014.

Lufthansa said it expects the strike on Friday to ground no more than two thirds of its 1,800 daily flights and said it would publish a flight schedule for the day later on Wednesday.   Continued...

A passenger uses his mobile phone while queuing at a Lufthansa check-in desk as members of German air carrier Lufthansa cabin crew union "UFO" attend a wage strike at the Berlin Tegel airport, September 4, 2012. REUTERS/Tobias Schwarz