Submit Press release  eTN Team ·  Advertising  ·  eTN Awards  - Worldtourism Events    

Airline Industry

Lufthansa, BA crews to vote on strikes

Steven Rothwell and Cornelius Rahn  Jan 18, 2010

British Airways Plc’s 13,000 flight attendants will vote on strike action next week after talks on crewing levels broke down. German competitor Deutsche Lufthansa AG is also facing a stoppage in a dispute with 4,500 pilots.

Negotiations with British Airways ended on Jan. 15 and no date has been set for a further meeting, the Unite union, which represents the cabin crew, said today. A vote last month for a strike over Christmas was declared invalid by a U.K. court.

BA and Lufthansa are seeking to slash expenses after the global recession sent traffic tumbling. The German company’s pilots have begun voting on a walkout after failing to secure guarantees prohibiting flight crews at the group’s BMI, Austrian Airlines and Brussels Airlines units from operating services for the main airline and its cargo and low-cost subsidiaries.

“Management sees this as the optimum time to push for a lower cost base,” said Andrew Lobbenberg, an analyst at Royal Bank of Scotland Group Plc with “buy” ratings on the carriers. “But the sides need to come to deals involving tradeoffs between changes in working practice and improved job security. Otherwise you end up in a pact of mutual self destruction.”

The dispute at British Airways concerns the introduction in November of working practices that cut at least one flight attendant on each long-haul service from its London Heathrow hub. Judge Laura Cox ruled that vote void on Dec. 17 because the union included people who had agreed to leave the airline.

Intensive Discussions

“We have been engaged in intensive discussions over the last few days, but unfortunately we have not been able to secure an agreement,” Unite Assistant General Secretary Len McCluskey said today in a statement. “We therefore have to honor our commitment to give our members the voice they were denied by the courts before Christmas, and hold a fresh ballot.”

Passenger traffic at British Airways, Europe’s third- largest airline after Air France-KLM Group and Lufthansa, fell 4 percent last month from a year earlier, the fifth consecutive monthly decline, as the dispute with its cabin crew intensified.

The 12-day walkout planned for Dec. 22 would have disrupted travel for more than 1 million people over the Christmas period.

“We are saddened but not surprised that Unite has called another strike ballot,” BA said today in an e-mailed statement, adding that the decision calls into question the union’s “good faith” in last week’s negotiations.

Emergency Planning

British Airways said it remains open to talks at any time without preconditions, though the carrier is developing a contingency plan that includes the leasing of aircraft and crews in the event of a strike, together with a request for all staff to be prepared to work as emergency flight attendants.

The company reported a record 217 million-pound ($355 million) loss for the first half ended Sept. 30, prompting Chief Executive Officer Willie Walsh to deepen efforts to cut costs.

Stoppages at Lufthansa may begin after voting ends on Feb. 17, Vereinigung Cockpit union spokesman Jan Krawitz said today.

The Cologne-based company aims to shave 1 billion euros ($1.4 billion) from costs by the end of next year, including a 20 percent cut in the workforce. It has been negotiating with Vereinigung Cockpit since May, and the union says talks failed last month. Krawitz said pilots may also now reverse their willingness to go without a pay raise.

The strike vote “sends the wrong signal at the wrong time” as the airline industry struggles with traffic declines, Lufthansa said in a statement today. Preparations for a walkout are “incomprehensible” because pilots enjoy excellent working conditions and there are no plans to impose compulsory firings, the company said, adding that it is seeking to resume talks.

Takeover Strategy

The German carrier bought Vienna-based Austrian Airlines AG and Castle Donington, England-based BMI last year. It also gained control of 45 percent of Brussels Airlines in mid-2009 and has plans for a complete takeover by 2011.

Lufthansa shares closed little changed at 12.76 euros in Frankfurt. They have gained 8.6 percent this year, giving a market value of 5.84 billion euros.

British Airways rose 1.1 percent to 194.7 pence in London after earlier advancing 3.8 percent. The stock is up 4.2 percent this year, valuing the company at 2.28 billion pounds.

Chief Financial Officer Keith Williams said Jan. 15 that potential investors were being put off by unresolved concerns.

The planned merger with Spain’s Iberia Lineas Aereas de Espana SA, a pension-fund shortfall and a prolonged application for antitrust immunity for an alliance with AMR Corp.’s American Airlines are among “big issues” confronting would-be shareholders, he said in a staff newspaper

Lufthansa, BA crews to vote on strikes
Image via


Premium Partners