German unions compete to offer greater cuts at Lufthansa
By Gustav Kemper
15 June 2020
Germany’s national carrier Lufthansa is exploiting the coronavirus pandemic to push through major restructuring. Like the economy as a whole, it is using it as an excuse to cut wages and massively cut jobs.
The cold-bloodedness of the Lufthansa Executive Board’s approach is hard to beat. After air traffic collapsed in March and April, Lufthansa CEO Karsten Spohr threatened to declare “voluntary insolvency” if the German government did not agree to a billion-euro rescue package without having any influence on business operations. This would have given him a free hand to circumvent collective bargaining agreements and pension obligations and cut numerous jobs. The talk was of 10,000 to 20,000 jobs.
The decline in air traffic was used to justify further job cuts. At present, about 700 of the company’s 763 aircraft are on the ground; 87,000 of its 135,000 employees are on short-time work and are being financed by the state. According to Spohr, 300 aircraft will remain parked next year, 200 in 2022, and about 100 aircraft after that date will not be needed.
The German government followed the company’s demand and gave its blessing to a rescue package worth €9 billion. In the meantime, the Supervisory Board and the European Commission have also given their approval, and shareholders will decide on this at an extraordinary general meeting on June 25. Faced with the alternative of insolvency or accepting the rescue package, they are likely to agree. Nevertheless, the company