Germany’s Lufthansa predicts 2024 return to ‘pre-crisis’ air traffic amid record net loss

Germany's Lufthansa predicts 2024 return to 'pre-crisis' air traffic amid record net loss
A Lufthansa plane is ready for its first flight in months on July 30th in Frankfurt. Photo: DPA
German airline giant Lufthansa said Thursday it made a net loss reaching €1.5 billion in the second quarter as the coronavirus pandemic slammed the brakes on travel.

The German flag carrier carried around 1.7 million travellers during the three months to the end of June — a 96 percent drop from the same period last year as lockdowns to slow the spread of the coronavirus restricted air travel worldwide.

Profit in the same period of the previous year was €754 million.

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Lufthansa said demand for air travel would return to pre-crisis levels in 2024 at the earliest, as it predicted a “clearly negative” operating loss in the second half.

The group, which received a government bailout worth €9 billion, had announced in June that 22,000 jobs would have to go.

Although it had said then that it would use schemes for shorter work hours and other crisis arrangements to avoid outright redundancies, the company said Thursday that was now “no longer realistically within reach for Germany either”.

READ ALSO: EU approves huge bailout of German giant Lufthansa

“We are experiencing a caesura in global air traffic,” Lufthansa chief executive Carsten Spohr said.

The collapse in traffic led to an 80 percent drop in quarterly revenue to €1.9 billion for Lufthansa Group, which also includes Austrian Airlines and Swiss. In the second quarter of last year, Lufthansa reported revenue of more than €9.5 billion.

The company said its fleet is to be permanently reduced by at least 100 aircraft, although its 2024 capacity will correspond to that of 2019.

Lufthansa previously said they would reduce its use of Airbus A380s and Boeing 747s.

In June, Lufthansa secured a €9 billion bailout from the German government, which now has a 20 percent stake in the group.

The airline said it now has €11.8 billion in liquidity, including government funds.

The group said it has so far reimbursed around €2 billion to customers in 2020 due to cancelled flights.

Fraport, which controls Frankfurt Airport, Lufthansa's main hub, said this week it plans to cut 3,000 to 4,000 jobs — as much as one-fifth of its workforce.

Passenger traffic at Frankfurt, Germany's busiest airport, fell 94.4 percent year-on-year in the second quarter of 2020 compared with last year.

READ ALSO: Frankfurt airport operator to slash jobs as air traffic plummets


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