Lufthansa is bleeding, preparing for a “difficult” winter

The German airline (Lufthansa), on Thursday, recorded a net loss in the third quarter of two billion euros, as it prepares for a “difficult” winter, amid closure measures to limit the outbreak of the new Corona virus.
Europe’s largest airline said it would run a maximum of 25 percent of its normal capacity from October to December, and expects to bleed 350 million euros ($ 410.9 million) in cash a month.
“We are now at the start of a difficult winter that will pose challenges for our sector,” Carsten Spur, CEO, said in a statement.
After its revenues deteriorated in the first wave of the “Covid-19” epidemic, in June the airline received support from the German state in the amount of 9 billion euros in liquidity in exchange for 25% of the shares.

Return restrictions

However, the return of restrictions on movement in Germany, along with stricter isolation measures in countries such as France and Britain, “significantly hurt” the future of air travel, according to Lufthansa.
Spur urged “rapid and large-scale tests” for the virus, to reduce the need for long-term quarantine, which airlines say discourages travelers.
The company is still on the path of returning to record positive operating returns in 2021, according to the statement, but only if “the situation allows for an increase in capacity to about 50 percent of pre-virus levels.”
In the three months ending in September, the company recorded a net loss of 2 billion euros, compared to a profit of 416 million euros in the same period last year, with only 20 percent of the usual number of passengers.
Losses were reduced thanks to “strict cost savings and expanded flight schedule” in the summer months, Spur said.

Reducing “bleeding”

Lufthansa has succeeded in reducing the money drain at the start of the epidemic from one million euros an hour to a “only” one million euros every two hours, it said in October.
The company had warned that 30,000 jobs were threatened as part of reducing its winter schedule to levels not seen since the last seventies. Yesterday, Thursday, it announced that 27,000 full-time jobs are due to “surplus”.
Lufthansa’s board says it is seeking arrangements “to reduce the number of necessary layoffs” by working for short periods and cutting wages.
Lufthansa, which includes Swiss and Austrian airlines, Brussels Airlines and Eurowings, hopes to remain “the leading European airlines group” after “an inevitable restructuring,” according to Spur.
(AFP)