October 21, 2014

It never rains but it pours for German travellers as more Lufthansa flights are cancelled

Immediately after the weekend where the German rail system was brought to a standstill through a strike by national train drivers, the 35 hour Lufthansa short-haul flight strike organised by the Vereinigung Cockpit union due to start this Monday afternoon has now been extended to include a 24 hour strike for long haul flights. The long-haul strike will commence this Tuesday afternoon as pilots pile the pressure on management. The train drivers’ strike stranded millions of travellers at a time when half-term holidays were beginning in many German states. Following on from that, the eighth walkout this year by Lufthansa pilots has affected over 1,500 flights and 200,000 people.
While the recent two-week strike at Air France-KLM that cost an estimated US$650 million was about the threat to pilots’ wage structure via the airline’s connection with their low-cost Transavia airline, this strike by Lufthansa pilots relates to transition payments demanded by pilots wishing to take early retirement. The Vereinigung Cockpit union, representing approximately 5,400 Lufthansa pilots, is determined to retain a scheme that enables pilots to retire at the age of 55, yet still receive up to 60 percent of their full pay before standard pension payments begin when they are 65. While the union has put forward a proposal to cover the costs of the scheme, the airline consider the proposal far from a compromise. As Simone Menne, the airline’s Chief Financial Officer, said: ‘The strikes are not only causing significant financial damage but are also damaging our image, the consequences of which are significant and not yet clear.’
If there is any connection between problems at Air France-KLM and Lufthansa, then it is the dire need to be able to run a low-cost airline which is able to compete with the likes of Ryanair and EasyJet. Both airlines need to trim costs at every level, and the more the unions pull pilots out on strike, the less likely it will be that either airline will be able to afford to run a low-cost operation, which could ultimately prove fatal in the long run.

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