Lufthansa pi­lots threaten to ex­tend strike over pay

Air­line can­cels 2,800 flights over four days

Kuwait Times - - BUSINESS -

BER­LIN:

Pi­lots at Lufthansa threat­ened yes­ter­day to ex­tend their lat­est strike in a long-run­ning pay dis­pute with the Ger­man air­line, rais­ing pres­sure on man­age­ment and leav­ing pas­sen­gers fear­ing fresh dis­rup­tion. The walk­out - the 14th since early 2014 - be­gan on Wed­nes­day and has al­ready grounded some 2,600 planes and af­fected more than 315,000 pas­sen­gers. Lufthansa has said the dis­rup­tion has started to hit medium-term book­ings.

The air­line said it would can­cel a fur­ther 137 flights on Satur­day, around 5 per­cent of its sched­ule, in­clud­ing 88 in­ter­con­ti­nen­tal flights. Some short- and medium-haul flights would also be af­fected, it said. Lufthansa urged the union to en­ter ar­bi­tra­tion but the union said it wants to see a bet­ter of­fer first. “As things stand at present, we will have to keep strik­ing as there is no ba­sis for ne­go­ti­a­tions or ar­bi­tra­tion with Lufthansa at the mo­ment,” said Jo­erg Handw­erg, board mem­ber at the Vere­ini­gung Cock­pit (VC) pi­lots’ union.

The union wants an av­er­age an­nual pay in­crease of 3.7 per­cent for 5,400 pi­lots in Ger­many over a five-year pe­riod from 2012. Lufthansa has of­fered 2.5 per­cent over six years to 2019. Lufthansa Chief Ex­ec­u­tive Carsten Spohr has said the car­rier’s fu­ture would be on the line if pi­lots’ wages were raised to the level de­manded. Lufthansa says it has to cut costs to com­pete with leaner ri­vals such as Ryanair on short-haul routes and Emi­rates on long-haul flights, de­spite mak­ing a record profit in 2015. Lufthansa pi­lots are well paid by in­dus­try stan­dards. A pi­lot at Lufthansa earns on av­er­age 180,000 eu­ros ($190,000) a year be­fore tax, though a cap­tain on the high­est pay level can earn as much as 22,000 eu­ros a month be­fore tax.

Pas­sen­gers at Frank­furt air­port yes­ter­day were run­ning out of pa­tience. “It’s not pleas­ant,” said Lufthansa pas­sen­ger Di­eter Eidt who was booked on a flight to Rome and faced a lengthy de­lay. “I be­lieve that they are de­mand­ing some­thing that can’t be ful­filled and which is un­jus­ti­fied,” Eidt said of the pi­lots. Se­nior con­ser­va­tive law­maker Michael Fuchs has called for forced me­di­a­tion to end the dis­pute. “It can’t be that hun­dreds of thou­sands are taken hostage for the in­ter­est of a small ma­jor­ity,” he said, adding the walk­out risked dam­ag­ing Ger­man busi­ness.

The econ­omy min­istry said it was up to man­age­ment and the union to find a so­lu­tion. Shares in Lufthansa, down more than 13 per­cent this year, traded 0.6 per­cent lower yes­ter­day as in­vestors fret­ted over the prospect of stop­pages drag­ging on. Ruxan­dra Haradau-Doeser, an avi­a­tion an­a­lyst at Ke­pler Chevreux, said Lufthansa’s profit tar­get of 1.8 bil­lion eu­ros ($1.9 bil­lion) for 2016 could be at risk if the strike lasts through­out the whole of next week.

How­ever, she added that in­vestors ex­pected Spohr to stand firm. “In­vestors trusted him on this. He is in a dif­fi­cult po­si­tion. If he were to yield, in my opin­ion he would lose the trust of in­vestors and the mar­ket,” she said. 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. The air­line has since agreed deals with the main unions rep­re­sent­ing ground staff and cabin crew in Ger­many. — Reuters

DUESSELDORF: Flight pas­sen­gers walk past an in­for­ma­tion sign with the logo of Ger­man air­line Lufthansa yes­ter­day at the air­port in Duesseldorf, west­ern Ger­many. — AFP

LONG-TERM DAM­AGE?

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