Lufthansa posts worst loss in history amid warnings of prolonged air travel slump
Lufthansa has posted the worst loss in its history in the second quarter as the German airline warned that it did not expect air travel to return to pre-pandemic levels until 2024.
As a result of coronavirus, the state-backed airline flew 96 per cent fewer passengers between April and June, leading revenue for the period to decline 80 per cent to €1.9bn.
It posted an operating loss of €1.7bn, around €300m lower than analysts had expected, and said it expected to record another loss in the second half.
Chief executive Carsten Spohr said: “We are experiencing a caesura in global air traffic. We do not expect demand to return to pre-crisis levels before 2024. Especially for long-haul routes there will be no quick recovery”.
Lufthansa said that over 8,000 employees had already left the business as part of a wholesale restructuring which will see 22,000 roles axed.
The airline said those who had left their roles so far were mainly from its catering business and non-German businesses, which include Swiss, Austrian Airlines and Brussels Airlines.
Last month it announced that 1,000 administrative staff would leave the company as it seeks to find ways to pay back a mammoth €9bn bailout from German authorities.
As part of the terms of the bailout deal, which was struck in June after months of wrangling, the German state will take a 20 per cent stake in the airline.
More than 98 per cent of Lufthansa’s stakeholders voted to back the rescue package at an extraordinary general meeting at the end of June.
With lockdown restrictions slowly being lifted around the world, the carrier said that it had begun to increase its flying programme in July.
Last month, it was offering around 20 percent of the previous year’s level of flights, with load factors of over 70 percent in European short-haul traffic.
In the third quarter, capacity offered is planned to increase to an average of around 40 percent of the prior year capacity on short- and medium-haul routes and to around 20 percent on long-haul routes, it said.