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Germany’s Lufthansa records first net profit since the start of pandemic

Lufthansa said Thursday its freight operations propelled the German airline group to its first net profit since the start of the coronavirus pandemic - despite the airline being plagued by chaos due to staff shortages and pay disputes.

An empty Lufthansa counter in Munich during a strike by ground staff on July 27th.
An empty Lufthansa counter in Munich during a strike by ground staff on July 27th. Photo: picture alliance/dpa | Peter Kneffel

Between April and June, Lufthansa recorded a net profit of €259 million ($263 million), over one billion euros more than the same period last year and its first positive quarter since the end of 2019.

Lufthansa was “back in the black”, CEO Carsten Spohr said in a statement, describing the pandemic as “the most severe financial crisis in our history”.

The group – which includes Eurowings, Austrian, Swiss and Brussels Airlines – made huge net losses of €6.7 billion in 2020 and €2.2 billion in 2021 as the pandemic shut down large parts of the airline industry.

Lufthansa was saved from bankruptcy by a government bailout in June 2020.

The improved figures were lifted by a “record” result for Lufthansa Cargo, which has benefitted from high demand and “ongoing disruptions in ocean freight”.

The freight division booked an operating – or underlying – profit of €482 million in the second quarter, a 48-percent improvement on last year.

A “boom” in demand for travel saw the result for Lufthansa’s passenger airlines “improved significantly” though they remained in the red, with the exception of Swiss.

Amid recent chaos at airports, Lufthansa said it would start recruiting again, bringing 5,000 new employees on board.

It comes after the airline slashed over 30,000 jobs since the start of the pandemic, out of 140,000 positions globally.

READ ALSO: Lufthansa pays back German bailout early – but job cuts still stand

A shortage of workers has left airports and airlines struggling to process high numbers of passengers, after they cut back their operations during the pandemic.

Lufthansa is also caught in disputes over pay and conditions. Ground staff carried out a strike on July 27th, while there are also threats of strikes from the Vereinigung Cockpit union, which represents German pilots. 

READ ALSO: Why is flying in Germany so expensive and chaotic right now?

During the ground crew strike, Verdi union said staff needed more money because they were essentially burnt out after “two years of the pandemic and massive job cuts”, as well rising inflation. 

Despite the disruption and the clouded outlook for the economy, Lufthansa said it “expects demand for tickets to remain high for the remaining months of the year”.

For the whole of 2022 Lufthansa planned to offer 75 percent of its pre-crisis capacity on passenger airlines.

The group also put a number on an expected operating profit for the year, saying it anticipated a result “above 500 million euros”.

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TRANSPORT

How the Greens want to replace Germany’s €9 ticket deal

New proposals drafted by the Green Party have set out plans for two new cheap travel tickets in Germany as well as a shake-up of the country's travel zones. Here's what you need to know.

How the Greens want to replace Germany's €9 ticket deal

What’s going on?

Germany’s €9 travel deal has been hugely popular this summer, with an estimated 30 million or so passengers taking advantage of the offer in June alone. Now the last month of the three-month offer is underway, there are hopes that the ticket could be replaced by another deal that offers simple, affordable travel on a regional or national basis.

There have been a few ideas for this floating around, including a €365 annual ticket and a €69 monthly ticket pitched by German transport operators. Now the Green Party has weighed in with a concept paper setting out plans for two separate travel tickets to replace the €9 ticket. The paper was obtained by ARD Hauptstadtstudio on Friday. 

Why do they want two different tickets?

The first ticket would be a regional one costing just €29 a month and the second would be a €49 that, much like the €9 ticket, would be valid for the whole of Germany.

This would allow people who mainly stay in their local region to opt for the most cost-effective option while long-distance commuters or those who want to travel further afield could opt for the nationwide offer.

Presumably the ticket would once again be valid for local and regional transport only rather than long-distance trains like the ICE. 

To simplify the system even more, the Greens also want to introduce new travel zones for the regional monthly tickets.

READ ALSO: Has Germany’s €9 rail ticket been a success?

How would the travel zones change?

According to the paper, Germany would be divided into eight regional zones that would include the Berlin-Brandenburg area, the eastern German states of Thuringia, Saxony and Saxony-Anhalt and the northern states of Hamburg, Schleswig-Holstein and Mecklenburg Western-Pomerania. 

The zones take passengers “statewide at a minimum”, the paper says, for example in the larger states of Bavaria, Baden-Württemberg and North-Rhine Westphalia.

However, as the map below shows, states will also be clustered together to make larger regions.

One of the major draws of the €9 ticket has been the flat-rate system that allows passengers to travel anywhere in the country using the same ticket. This appears to be what the Greens are trying to replicate with their proposals. 

READ ALSO: What happens to Germany’s €9 ticket at the end of August?

How would this be financed? 

As you might expect, the Green Party is placing less eco-friendly forms of transport in the crosshairs as it looks for cash to fund the cheap tickets.

The first way to free up cash would be to end tax breaks for people with company cars. In addition, taxes on CO2 emissions would be increased. 

This would result in “additional revenues for the federal government and the states, which could flow seamlessly into the financing of cheap tickets”, the paper states. 

However, the Greens don’t set out how much money they think this would bring in or how much the discounted tickets would cost the state in total. 

Is this definitely going to happen?

At the moment, it seems that the Greens are the main voices in the coalition government pushing for a longer term travel deal – and they continue to face opposition from the pro-business FDP.

Unfortunately for the Green Party, the FDP happen to be heading up two crucial ministries that could both play a role in blocking a future offer: the Finance Ministry and the Transport Ministry. 

However, with four out of five people saying they want to see a successor to the €9 ticket in autumn, Transport Minister Volker Wissing (FDP) is currently under pressure to come up with a replacement as soon as possible. 

A passenger sits on the platform a Berlin Hauptbahnhof

A passenger sits on the platform a Berlin Hauptbahnhof waiting for a train. Photo: picture alliance/dpa | Joerg Carstensen

At a press conference a few weeks ago, he promised to discuss this with the state transport ministers after analysing how successful the ticket had been.

In particular, researchers will want to look at how many people ended up leaving the car at home and taking the bus or train instead.

Though the data on this is inconclusive at the moment, some studies have shown reduced congestion on the roads while the ticket was running.

In a survey of The Local’s readers conducted last month, 80 percent of respondents said they had used public transport more with the €9 ticket and 85 percent said they wanted to see a similar deal continue in the autumn.

Of the options on the table so far, a monthly €29 ticket was by far the most popular choice.

READ ALSO: ‘Affordable and simple’: What foreigners in Germany want to see after the €9 ticket

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