World | Europe

November 24, 2016

Lufthansa Pilot Strike Grounds Hundreds of Flights for Second Day

The walkout has cost the German airline about $21 million over two days, a board member said.

A walkout by Lufthansa pilots that has led to almost 2,000 flight cancellations has cost the German airline about 20 million euros ($21 million) over two days and weighed on its mid-term bookings, a board member said on Thursday.

The walkout, the 14th since early 2014, began at midnight on Wednesday and was due to run until Friday, ratcheting up pressure on management in a long-running pay dispute and threatening further disruptions for travellers.

“Not only have we suffered severe damage (from the strike), but we’re also noticing from mid-term booking numbers that customer behavior is changing,” Harry Hohmeister said.

Lufthansa has cancelled 1,800 flights, or just under a third of scheduled services, for Wednesday and Thursday, disrupting the plans of over 215,000 travelers.

Friday’s strike affects short-haul flights only and Lufthansa said it will publish details of Friday’s cancellations by midday on Thursday.

Pilot strikes in 2014 cost Lufthansa 222 million euros, roughly 21 million euros per day, according to the IW Cologne Institute for Economic Research. In 2015, walkouts by pilots and cabin crew cost it 231 million euros, around 30 million per day.

Lufthansa, led by CEO Carsten Spohr, insists that despite a record profit in 2015, it has no choice but to cut costs to compete with leaner rivals such as Ryanair on short-haul and Emirates on long-haul flights.

It has already agreed deals with the main unions representing ground staff and cabin crew in Germany, leaving an agreement with its pilots outstanding.

The union, which fears a race to the bottom in terms of pay and conditions, wants an average annual pay increase of 3.7% for 5,400 pilots in Germany over a five-year period from 2012. Lufthansa has offered 2.5% spread over the six years to 2019.

The airline has urged the union to enter mediation, but the union said it first wants to see a better offer.

Despite the row with its German pilots, Lufthansa is also moving forward with plans to expand lower cost operations, using a Eurowings unit based in Austria. It is in talks over bringing operations from Air Berlin and Brussels Airlines into the Eurowings platform.

The row is mirrored at rival Air France-KLM, which has also seen pilot strikes in France over plans to lower costs.

 

Text by Fortune
 

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