June 22, 2015 / 9:52 AM / 2 years ago

Cabin crew give Lufthansa deadline to avoid strike

FRANKFURT (Reuters) - German airline Lufthansa (LHAG.DE) faces a June 30 deadline to make concessions to cabin crew over pay and pensions or suffer further strikes that would compound the effects of a costly dispute with its pilots.

A Lufthansa Airbus A380-800, with Tail Number D-AIMJ, lands at San Francisco International Airport, San Francisco, California, April 16, 2015. REUTERS/Louis Nastro

Lufthansa has been in protracted talks with various staff groups as it seeks to bring down costs and revise pension schemes, to better compete with low-cost airlines and expanding Middle Eastern rivals.

The UFO flight attendants’ union said on Monday its members would strike on July 1 if an agreement was not reached with Lufthansa by then. Further one-day strikes would follow that could last to Sept. 16, disrupting travel over the lucrative peak summer season, the union added.

“Everyone ... will have the chance to opt for modes of transport other than Lufthansa on the days for which we are to announce strikes,” UFO head Nicoley Baublies told a news conference.

UFO, which represents 19,000 cabin crew at Lufthansa, said on Saturday it would not resume talks with the company after mediation failed.

Lufthansa says that low interest rates mean it can no longer afford the retirement scheme it offers to cabin crew. The costs of the scheme - to the tune of 3.7 billion euros last year - are of particular concern for the airline because cabin crew can take early retirement from the age of 55 due to the strains of frequent flying.

It wants employees to siphon off more of their own salary for pension assets.

UFO wants to keep much of the current retirement scheme.

The airline said it remained ready to talk.

“We call on UFO to use its self-imposed June 30 deadline for a constructive way forward and to actually engage with us in the proposed discussions. Our joint goal must be to avoid strikes under all circumstances,” a spokesman said in a written statement.

Lufthansa has already been hit by over a dozen walk-outs over the last year by its pilots, who are also in talks over pension benefits and pay and are now also in a mediation process, ruling out strikes until the end of July.

The carrier’s stock pared gains to trade up 1.1 percent at 7.40 a.m. EDT, while Germany’s blue chip DAX .GDAXI index was up 2.8 percent.

Strikes by pilots will cost Lufthansa 100 million euros ($111 million) in lost profit and bookings in the first half of 2015, the company said last month.

Writing by Ludwig Burger; Editing by Keith Weir and Susan Fenton

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