Lufthansa to cut 3,500 jobs
Lufthansa on Thursday unveiled plans to cut 3,500 jobs as it reported a worse than expected operating loss of €381m in the first quarter of 2012.
Analysts had been expecting a loss of €273m for the three months to March 31 but were reassured by how Europe’s largest airline by revenue stuck to its previous earnings guidance for the year.
Lufthansa expects to generate an operating profit “in the mid three-figure million euro range” in 2012.
It said economic uncertainty made it difficult to predict demand for its services, but added the industry was showing restraint on seating capacity growth, which meant airlines could better manage ticket pricing.
“The [economic] mood overall has lightened,” it said. The airline’s shares were up 1.5 per cent at €9.85 in early Frankfurt trading.
Lufthansa is cutting 3,500 administrative jobs, or 3 per cent of its group headcount, as part of a €1.5bn cost-cutting programme that runs over the next three years.
The airline blamed the €381m loss mainly on higher fuel costs, although it also hit out at air passenger taxes and aviation charges stemming from the European Union’s carbon emissions trading scheme…
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UPDATE 1-Lufthansa denies has firm plans to cut 3,000 jobs
Deutsche Lufthansa AG said it was still evaluating how many jobs it would cut in a cost-reduction programme, in response to a report that Germany’s biggest airline plans to axe about 3,000 administrative jobs.
German mass-circulation paper Bild earlier reported that Lufthansa planned to cut half of a total of 6,000 administrative jobs around the world, with 1,500 jobs to go in Frankfurt.
The remaining administrative jobs are to be moved to a new business unit, with longer working hours and less pay, the paper said, citing an internal document.
“We always said that we do not explicitly rule out job cuts,” a spokesman for Lufthansa said.
Lufthansa aims to cut costs by 1.5 billion euros ($1.98 billion) by the end of 2014 to squeeze profit margins out of a business that is battling high fuel prices, fierce competition of low-cost carriers and Middle East airlines and a weak European economy…