The negotiations for state aid for the Austrian Lufthansa subsidiary AUA (Austrian Airlines) are apparently nearing completion. Lufthansa CEO Carsten Spohr spoke in a conference call yesterday about a possible positive solution later this week. When asked, he didn’t want to say when there would be a signature. According to Spohr, the Austrian Chancellor will announce the details of a deal when all talks are completed.
In the face of billions in losses due to the corona crisis, the Lufthansa boss had previously announced “far-reaching restructuring” of the aviation group. This is necessary in order to be able to repay government grants of up to nine billion euros as quickly as possible. The German airline suffered a loss after taxes and depreciation of 2.1 billion euros from January to March. At AUA, the operating loss in the same period was 197 million euros.
At the AUA sister company Swiss, the operating loss in the first three months was 84.1 million francs (78.3 million euros) after a profit of 48.3 million in the previous year. Swiss does not see itself in a position to make a profit forecast for the full year.
Annual General Meeting on June 23
In the crisis, the Lufthansa Group has to be saved from bankruptcy with government grants of up to nine billion euros (loans, silent participations and share purchases). The financial package negotiated with the German government has yet to be approved by the EU Commission and has to be approved at an extraordinary general meeting on June 23. Because for the entry of the German state with a share of 20 percent, the capital must be increased by 25 percent. The grants are to be repaid by 2023 if possible – this is how long it will take aviation to digest the corona shock.
20,000 jobs jiggle
Lufthansa is fighting the disaster by cutting costs, which will also affect the staff. Of the almost 137,000 employees, 87,000 are on short-time work. There is a personnel surplus of up to 20,000 employees, it is said in corporate circles. A solution is to be found with the unions to keep as many of them on board as possible.
The subsidiaries AUA and Brussels Airlines have already decided to cut personnel costs by between 20 and 25 percent.
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