Lufthansa chief executive: After Covid-19 airfares will surge
Lufthansa’s chief executive has said ticket prices will soar as a result of air travel recovering from the pandemic.
Lufthansa chief executive Carsten Spohr has warned that airfares will surge, with passengers paying the pandemic’s economic price. As reported by the Daily Telegraph, Spohr believes that before the pandemic plane tickets were too cheap and, as a result of the economic impact caused by Covid-19 on aviation, prices are expected to rise dramatically.
“I believe that prices were too low before Covid. €9 or £9 [for a flight] from the UK to Portugal is not healthy for the industry, not healthy for our environment,” the Telegraph reported Spohr as saying.
Spohr thinks his airline rivals will also be forced to increase their prices, as the Covid-related economic issues, will not allow airlines to maintain pre-pandemic prices.
He told the Telegraph: “I think we see more disciplined players now because everybody took on debt. Lufthansa in the end probably has a $10bn bill of this whole Covid-19 crisis.”
After suffering major losses as a result of the global travel restrictions which led to the German state offering financial aid, the German airline has undergone a significant market recovery in the second quarter of 2021, with passenger and booking numbers recovering strongly.
Lufthansa’s finance boss Remco Steenberg commented this summer: “In our financial management, our focus remains on strengthening our balance sheet. The second quarter was another step in the right direction.
“However, there is no way around making the Lufthansa Group profitable again as quickly as possible and implementing further cost reductions.”
The company’s operating loss based on the earnings before interest and taxes (Ebit) has increase from -€1.7bn in 2020 to -€952m this year.