Deutsche Lufthansa AG canceled hundreds of flights, impacting 100,000 passengers, as flight attendants began a three-day strike in a hardening labor dispute that has already led to a record series of walkouts by cabin crew.
The airline early Wednesday lost a court bid to stop the strike at its main hubs in Frankfurt and Munich, forcing the German carrier to drop 931 flights. A separate court will decide Wednesday afternoon whether the UFO cabin crew union can also walk off the job in Dusseldorf, a secondary airport for the airline, after a judge prohibited flight attendants from striking in that city on Tuesday.
“We must push for solving our labor issues for as long as it takes,” Chief Executive Officer Carsten Spohr told reporters at an event in Frankfurt. “I cannot compromise on solving these issues. There is no alternative. The world is changing.”
Flight attendants and pilots are fighting Spohr’s efforts to overhaul Lufthansa and develop the Eurowings division into a low-cost arm to compete with rivals such as Ryanair Holdings Plc and EasyJet Plc. Spohr has stuck with that strategy even as mainline brand employees have resisted, viewing the potential gains as being worth the immediate hit. Ruxandra Haradau-Doeser, an analyst at Kepler Cheuvreux, estimates the financial impact of the current cabin crew strikes, which began last week, at about 100 million euros ($107 million).
“They’ve clearly decided to take on the cabin crew, to take on the pilots,” said James Hollins, a Nomura aviation analyst based in London. “The management determination gives us some faith. They’re not just going to capitulate. Short-term pain certainly. Long term, they have to do this.”
Including the Wednesday cancellations, Lufthansa has been forced to drop more than 2,800 flights since the strikes began Nov. 6. Investors have largely backed management’s tough stance, with the shares rising as much as 1.3 percent on Wednesday, giving the airline a market value of 6.28 billion euros.
Lufthansa’s latest offer to UFO included a one-time payment of 3,000 euros per employee and acceptance of the union’s demands on early retirements, but only for current workers. The carrier also said it will scale back flights, a proposal that UFO called a “provocation.”
Lufthansa has declined to estimate how much the flight attendants’ strike has cost. A parallel dispute with pilots that led to 12,800 cancellations over an 18-month period amounted to a burden of 352 million euros. Walkouts by pilots ended last September when a German court ruled that the moves marked an illegal effort by the Vereinigung Cockpit union to fight corporate strategy. Vereinigung Cockpit announced on Tuesday that it had filed an appeal at the Constitutional Court, Germany’s highest court, against that ruling.
–With assistance from Kari Lundgren in London.
This article was written by Richard Weiss and Karin Matussek from Bloomberg and was legally licensed through the NewsCred publisher network.