September 9, 2014 / 4:44 PM / 3 years ago

Lufthansa will offer striking pilots more details on retirement plan

German Lufthansa planes are parked on the tarmac at Munich's international airport early January 25, 2013. REUTERS/Michael Dalder

BERLIN/FRANKFURT (Reuters) - Lufthansa said it would offer pilots more definite details of an early-retirement package as it seeks to avert further costly strikes after Germany’s flagship airline saw three walkouts announced in the space of two weeks.

“We want to provide the pilots with a more concrete offer, which we will work on over the next few days,” Lufthansa Chief Executive Carsten Spohr told reporters at an event in Frankfurt on Tuesday. “This offer will be communicated at the start of next week.”

Earlier on Tuesday, Lufthansa said it was cancelling 110 Munich flights on Wednesday, affecting thousands of passengers, after pilots’ union Vereinigung Cockpit called for a third strike at the German airline in two weeks.

The proposed strike at Munich, Lufthansa’s biggest airport after Frankfurt, will run from 0800-1600 GMT on Wednesday, the union said on Tuesday. Lufthansa usually operates around 320 flights to and from the airport during that time.

The pilots want to increase pressure on Lufthansa in negotiations over an early-retirement scheme. They held a strike at its budget carrier Germanwings at the end of August, followed by a walkout at Frankfurt last week.

Lufthansa, which has called on the pilots to return to the negotiating table, said the strike would not result in long-haul flights being cancelled, although there could be some delays. Long-haul flights are the most lucrative for Lufthansa.

“Some pilots who want to fly despite the strike have already come forward,” Lufthansa said in a statement on Tuesday, adding that the eight-hour strike would affect the travel plans of 13,500 passengers.

Shares in Lufthansa closed down 1.5 percent at 13.60 euros. The wider Dax index fell 0.5 percent.

DZ Bank analyst Dirk Schlamp said he estimated the latest strike would cost Lufthansa around 2 million to 4 million euros in lost operating profit.

“But another negative effect will likely be that passengers will book with other airlines out of concern that more strikes are on the way,” he told Reuters.

Vereinigung Cockpit represents about 5,400 of Lufthansa Group’s 9,000 pilots and the previous two strikes have cost the airline more than 10 million euros ($12.9 million) in operating profit and have hit bookings.

A three-day pilots’ walkout in April wiped 60 million euros from first-half operating profit at the airline, which is undergoing restructuring and cost cuts as it seeks to better compete with fast-growing Middle East and low-cost carriers.

One of Lufthansa’s top 15 shareholders said Lufthansa Chief Executive Carsten Spohr should not give in to the union’s demands.

“Spohr has to stay tough, perhaps get even tougher,” Michael Gierse, a portfolio manager at Union Investment told Reuters.

Spohr said on Tuesday that the board had discussed whether Lufthansa should simply wait until the row with the pilots died down.

“We believe we have the best pilots,” Spohr said. “They are an asset to be protected, but we have to make sure we can afford them.”

Reporting by Victoria Bryan; Additional reporting by Peter Maushagen; Editing by David Goodman and Susan Thomas

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below