Lufthansa averted a pilot strike after raising its pay offer, a move that will avoid cancellations while complicating the airline’s efforts to boost profit and pay down debt.
The VC pilots’ union spokesman said the union decided to call off a planned two-day walkout that was due to start after midnight after Lufthansa improved its offer. The union didn’t immediately comment on the terms of the new conditions. Lufthansa didn’t immediately comment.
Lufthansa shares traded 3.1 per cent higher as of 2:48pm in Frankfurt. The company’s stock has fallen about 3 per cent since the start of the year.
Late last month, the union — which represents about 9,600 members — voted overwhelmingly in favour of walkouts. Lufthansa’s pilots are demanding wage increases to help offset the near double-digit increase in consumer prices. A walkout by ground crew caused the carrier to scrap hundreds of flights at its Frankfurt and Munich hubs last week.
Europe’s aviation industry has been plagued by chaotic operations in recent months, partly because of a lack of ground personnel in areas from security to baggage handling, and as employees push for higher wages to grapple with soaring costs of living.
Travel demand has roared back as people return to business trips and vacations after being stuck in lockdowns for the better part of two years, pandemic-fighting measures that pushed Lufthansa to the brink of bankruptcy in 2020 and left it saddled with billions of euros in debt.
In a bid to cut the carrier’s debt pile, Lufthansa chief executive Carsten Spohr has pledged to boost the airline’s earnings margin to a minimum of 8 per cent by 2024. Disputes with worker representatives and concessions over pay suggest Spohr might have trouble reaching those goals, as he tries to balance the need for more staff with a push to cut costs. — Bloomberg
