Will union offer give Lufthansa a lift?

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A minute’s silence for the victims of the Germanwing’s plane crash. Its parent company Lufthansa has been scarred by the tragedy, says the airline’s CEO. (SOUNDBITE) (German) LUFTHANSA CHIEF

Will union offer give Lufthansa a lift?

A minute’s silence for the victims of the Germanwing’s plane crash.

Its parent company Lufthansa has been scarred by the tragedy, says the airline’s CEO.

(SOUNDBITE) (German) LUFTHANSA CHIEF EXECUTIVE, CARSTEN SPOHR, SAYING:

“The shock is still deep within us, particularly because the passengers and crew of flight 9525 were apparently killed on purpose.”

It’s also been scarred by 15 strikes over the past year, costing the company 200 million euros in lost operating profit in 2014.

(SOUNDBITE) (German) LUFTHANSA CHIEF EXECUTIVE, CARSTEN SPOHR, SAYING:

“Despite strike costs in the three-digit million euro range, we were able to keep our adjusted projection. With a turnover of almost 30 billion euros, we showed an operating profit of almost one billion euros. But we also know that this is not enough in the long term.”

Lufthansa’s attempts to expand low-cost operations helped spark the industrial unrest.

The annual general meeting was an opportunity to offer an olive branch to the pilots’ union in the form of mediation.

But not every issue will be on the table.

Early retirement benefits and other outstanding wage issues will be up for discussion but not the low-cost operation itself, which is a key union demand.

CMC’s Jasper Lawler.

SOUNDBITE: CMC Markets analyst, Jasper Lawler, saying (English):

“The pilots obviously don’t want to accept the kind of lower wages that go alongside competing with these other airlines but still Lufthansa is very determined to go where the growth is and it is these budget airlines which have been undercutting them. And so that remains a source of tension.”

The CEO also confirmed an operating profit target for Lufthansa, before interest and tax, of over 1.5 billion euros this year.

A few less strikes would help achieve that.

Talks could start as early as this week.

Tags : lift, Lufthansa, give, offer, union, will

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