Lufthansa Group has confirmed that further cost cuts are “inevitable” in a second wave of restructuring in the wake of the coronavirus crisis.
The first set of measures in early April saw the fleet cut by 100 aircraft and the decision not to resume Germanwings’ operations.
Despite securing a $9 billion German government bailout and financial support from Austria and Switzerland, the airline group warned that “the complete repayment of state loans and investments, including interest payments, will place an additional burden on the company in the coming years, making sustainable cost reductions inevitable”.
A series of new measures will see 1,000 administration jobs cut and leadership positions cut by 20%.
Investment in new aircraft is being halved to a maximum of 80 by 2023.
Overall fleets across the group will be trimmed, with 22 Lufthansa aircraft already phased out ahead of schedule, including six Airbus A380 superjumbos, 11 Airbus A320s and five Boeing 747-400s.
The group said: “Due to the long-term effects to the aviation industry as a result of the coronavirus pandemic, there is a calculated personnel surplus of at least 22,000 full-time positions within the companies of Lufthansa Group.
“Nearly all airlines worldwide are currently affected by personnel surplus and in contrast to many of its competitors, Lufthansa will continue to avoid redundancies wherever possible.
“This requires agreements on crisis-related measures with unions and social partners representing the Lufthansa employees.”
But it admitted that negotiations have only so far been successful with the UFO cabin crew union.
The restructuring programme titled ‘ReNew’ is due to run until December 2023.
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