Lufthansa job cuts surge: 26,000 at risk

Lufthansa’s job cuts are to be expanded. JUNE 11 (REUTERS) – LUFTHANSA ADMITTED ON WEDNESDAY THAT ITS 26,000 EMPLOYEES HAD EXCEEDED THE NEEDS, SUGGESTING MORE JOB CUTS THAN THE MORE THAN THE MORE THAN 10,000 ANNOUNCED A FEW WEEKS AGO.

Originaltitle: Lufthansa job cuts surge: 26,000 at risk

Lufthansa job cuts surge: 26,000 at risk

Speaking after a meeting with industry unions, a Lufthansa spokesman said the airline estimated 22,000 full-time jobs or 26,000 employees to be redundant.

Lufthansa last week pledged a wide-ranging restructuring that would include job cuts and asset sales to repay 9 billion euros ($10.26 billion) in state aid funds and address the growing losses caused by the new coronavirus pandemic.

Lufthansa said last week that the job cuts would be “significantly higher” than its previous estimate of 10,000.

Lufthansa is trying to reach an agreement with the union ahead of a special general meeting on June 25th to allow staff to work part-time and otherways to cut staff costs. The company’s shareholders will vote on the national rescue package at a general meeting of shareholders.

Flight attendants’ union UFO has previously asked Lufthansa to promise to avoid mandatory redundancies and said it was working to reach a deal before the shareholders’ meeting.

Meanwhile, the union representing pilots has said its members are offering proposals to cut pay by up to 45 per cent, totalling about 350 million euros, but in return it wants Lufthansa to try to keep as many jobs as possible.

Earlier, on May 26, the German government and Lufthansa said they had reached a 9 billion euro ($9.81 billion) financial rescue deal, according to US media reports.

“This is an important step because it will create more than 100,000 jobs, maintain Germany’s leading position in the global civil aviation sector, and ensure that airlines continue to operate robustly in the wake of the new coronavirus pandemic,” German Economy Minister Peter Altmaier said monday. “

Under the agreement, the German government will take a 20 percent stake in Lufthansa and appoint two supervisory board seats. However, the decision still needs to be approved by Lufthansa’s board of directors, shareholders and the European Commission.

The agreement ends a weeks-long tug-of-war between Lufthansa’s management and the German government, which has been at loggerheads over how much control the government should give Lufthansa in exchange for financial support.

Carsten Spohr, Lufthansa’s chief executive, stressed that the government had little impact on the company’s business decisions. Germany’s Federal Economic Stability Fund (WSF) has agreed not to exercise its voting rights unless there is an offer to increase its stake to 25 per cent plus one share. Peter Altmeier said the deal would deter foreign investors from taking advantage of the crisis to take control of Lufthansa.

Lufthansa said WSF would take a 20 per cent stake in the company in the form of a capital increase to buy new shares in cash totalling about 300 m.

In addition, the 9 billion euros includes a government capital injection of up to 5.7 billion euros into Lufthansa, which can be repaid in full or in part on a quarterly basis, and a 3 billion euro loan from The Bank of Germany’s Renaissance Credit Bank.