Lufthansa Group Strikes Cost $375m in First Quarter
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Lufthansa Group Strikes Cost $375m in First Quarter

The Lufthansa Group Airlines comprises Austrian Airlines, Brussels Airlines, Lufthansa, and Eurowings. However, the Lufthansa Group had a profitable end to the year 2023 but they began their first quarter of 2024 with losses. The primary reason for such results in Q1 of 2024 for Lufthansa Group is because of the heavy strikes by the laborers. They have suffered a cumulative loss of $374.6 million in the first; however, the authorities are extremely positive about the remaining year.

The Chairman of the Executive Board and CEO of Lufthansa Group, Carsten Spohr said that the first quarter of 2024 was a turning point and now they have long-term agreements with several labor unions to manifest positive results in the remaining year. They are seeing positive demand for this summer which is quantitatively higher than last year, and with long-term agreements with the unions, they can anticipate positive results for this year and the coming years.

He added that they’re expecting a strong summer this year because of which they are building more capacity to their network by adding high load factors. Business travel also recovered well this year, he added, so they are looking to provide more premium offerings to improve the amenities of their business class.

Lufthansa Airlines has added an upgrade to their long-haul fleet cabins, called Allegris. It is the first aircraft of Airbus A350-900 type with completely new interiors, and is registered at D-AIXT. They ferried the aircraft from Munich Airport (MUC) to Frankfurt Airport (FRA) on April 26, 2024; that’s when Allegris came under public eye.

The first quarter was loss-making for the Lufthansa Group and they are blaming the strikes as the major reason. The Group encountered negative earnings before interest and taxes (EBIT) and net loss is -€849 million ($909 million) and €734 million ($785.8 million), respectively. The above numbers show a -211% and -57% change Year-on-Year (YoY), respectively.

Photo by AFP via Getty Images

Passengers stand at the Lufthansa check-in area in Terminal 2 at an airport in Hamburg, Germany Thursday, Feb. 8, 2024. The Ver.di union called on ground staff at Frankfurt and Munich, Lufthansa’s two main hubs, as well as Berlin, Duesseldorf and Hamburg, to strike for 27 hours starting at 4 a.m. Wednesday. (Marcus Brandt/dpa via AP)

However, the Lufthansa Group had warned about the upcoming loss on April 16. They said that their Q1 2024 adjusted EBIT will be -€849 million ($909 million) due to strikes by many groups which includes the ground handling employees and flight attendants of Lufthansa. These groups represent the United Services Trade Union and Independent Flight Attendants’ Union.

Apart from the losses and group strikes, some positives in the whole scenario was an increase in their overall revenue by 5% YoY which reached €7.3 billion ($7.8 billion). The total passenger count is 24.3 million which has increased by 12% YoY in the first quarter of 2024. The capacity of the Lufthansa Group measured in Available Seat Kilometers (ASK) has also increased by 12%. 

In spite of all the adversities that Lufthansa Group faced in the beginning of 2024, they’re expecting a positive outcome towards the end of this year. Since the demand is stronger and growing, the Group is expecting a great year in 2024.

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