On Wednesday this week, Air Berlin PLC & Co., (airberlin) Germany’s second-largest airline, announced radical changes to the company structure with the intention of delivering long-term growth. Airberlin now intends to focus core operations as a network carrier from its two main hubs, Berlin and Dusseldorf, in Germany. The leisure flight section of the business will be combined into a separate business.
The principal elements of the restructuring will involve providing Lufthansa Group with up to 40 Airbus A340 Family aircraft; up to 38 wet-leased under a six-year agreement. The restructuring follows a period where a comprehensive bottom-up review of the company was performed to improve efficiency and establish a clearer market proposition.
The changes will come at a cost to personnel, with an anticipated 1,200 redundancies to follow, though discussions will be held with works councils’ representatives to establish which will be voluntary and which will be enforced layoffs.
According to Stefan Pichler, airberlin’s Chief Executive Officer, “This far-reaching restructuring of our operations is about a new focus, giving us a new future.
“Now more than ever, we are faced with significant external market pressures which dictate a change to our current complicated business model. airberlin has sought to serve all market segments with one operating platform, covering both business and leisure travelers.
“The core airberlin proposition in future is now clear: a dedicated focused network carrier serving higher-yielding markets from two hubs in Dusseldorf and Berlin. A leaner, fitter, stronger airberlin has a bright future.” He then added: “Our leisure business has great underlying value which will be stronger in a separate touristic-focused business unit.
“In turn, this allows airberlin to focus on its core operation as a network scheduled airline.”
The airline will be looking to expand its more-profitable long-haul program, adding new routes and increasing flight frequencies, especially to the U.S.
airberlin intends to offer alternative employment to those made redundant, subject to all respective co-determination rights relating to voluntary redundancy, ideally throuogh redeployment opportunities within the Etihad Airways Partners group of airlines, which includes Jet Airways, Air Serbia, Etihad Regional, Alitalia, Air Seychelles and Etihad Airways.
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