2. Lufthansa's industrial relations are strained
According to Lufthansa, industrial action by its pilots lowered the group's operating profit by EUR232 million in 2014 (this includes the impact of strikes by security personnel). Pilot strikes have continued into 2015 as both parties struggle to resolve their differences, ostensibly over pilot retirement age and pension benefits, but also related to the increasing use by the group of lower cost vehicles avoiding the central collective labour agreement.
Although CEO Carsten Spohr has shown consistency and resolve in pressing ahead with the establishment of these vehicles, their successful operation will require the cooperation of all staff groups.
3. Lufthansa was slow to respond to the LCC competitive threat
Low cost carriers began to establish successful pan European operations in the mid 1990s. Nevertheless, and in spite of owning its low cost subsidiary Germanwings for many years, Lufthansa did not start to use its own LCC aggressively until 2013.
2. Lufthansa's industrial relations are strainedAccording to Lufthansa, industrial action by its pilots lowered the group's operating profit by EUR232 million in 2014 (this includes the impact of strikes by security personnel). Pilot strikes have continued into 2015 as both parties struggle to resolve their differences, ostensibly over pilot retirement age and pension benefits, but also related to the increasing use by the group of lower cost vehicles avoiding the central collective labour agreement.Although CEO Carsten Spohr has shown consistency and resolve in pressing ahead with the establishment of these vehicles, their successful operation will require the cooperation of all staff groups.3. Lufthansa was slow to respond to the LCC competitive threatLow cost carriers began to establish successful pan European operations in the mid 1990s. Nevertheless, and in spite of owning its low cost subsidiary Germanwings for many years, Lufthansa did not start to use its own LCC aggressively until 2013.
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