‘Lufthansa is back’ says airline. But after IT failure and ongoing strikes, what’s the full picture?
The beginning of 2023 has been turbulent for Germany’s Lufthansa Group.
In February, it was hit by a catastrophic IT failure that caused widespread flight cancellations across the six airlines it owns. Construction work damaged telecoms cables in Frankfurt which led to the collapse of the company’s network.
Just days after, ongoing strike action at airports across Germany led to thousands more flights being cancelled.
As it continues to recover from staff shortages since the pandemic, Lufthansa has reportedly cut more than 30,000 flights from its schedule this summer according to German business newspaper WirtshaftsWoche.
So, with the lingering effects of COVID-19 still affecting passengers, can the German flag carrier avoid further chaos in 2023?
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A ‘financial turnaround’ in 2022
Lufthansa claims it achieved a “financial turnaround” last year after almost going bankrupt two years ago.
In 2022, 102 million passengers flew with the airline - more than twice as many as the previous year. Strong demand for air travel meant that the company’s revenue doubled to nearly €33 billion.
It intends to grow again in 2023 with boss Carsten Spohr recently stating that “Lufthansa is back”.
“In just one year, we have achieved an unprecedented financial turnaround. With an operating profit of 1.5 billion euros, the Lufthansa Group has achieved a much better result than expected,” he added.
The figures, however, are still falling short of what they were pre-pandemic and increased profits will be of little comfort to passengers worrying about further disruption to their holiday plans this summer.
Will more Lufthansa flights be cancelled this summer?
During the COVID-19 pandemic, staff cuts and other savings tactics were rapidly activated to cope with the crisis.
Spohr said back in 2020 that the airline had around 27,000 too many full-time employees. After taking a €9 billion pandemic bailout from the German government, it carried out mass redundancies. At least 10,000 people were laid off between 2020 and 2022.
But the return of air travel was quick and, like many airlines, Lufthansa wasn’t prepared - leading to staffing issues. In the summer of last year, it had to cancel thousands of flights causing massive disruption for passengers.
It is still struggling with the lingering impacts of staff shortages which are affecting the entire industry. To prevent further chaos and last-minute cancellations in 2023, Lufthansa has reportedly cut at least 34,000 flights from its summer schedule.
Theoretically, this will allow passengers more time to make alternative arrangements and avoid last-minute disruption to their travel plans.
Spohr told a press conference in early March that the possibility of further cancellations this summer would depend on airports, not airlines. He warned that there was a risk that capacity could be limited due to high demand.
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Can Lufthansa solve its staffing issues?
Lufthansa is trying to fix its staffing problem. Near the end of last year, it launched a massive recruitment drive with the German flag carrier looking to bring on 20,000 new employees by the end of 2023.
It advertised more than 45 different positions from pilots and flight attendants to IT specialists and lawyers.
But staffing issues are still causing the airline problems and are sometimes outside of its control.
Recent strikes led to the cancellation of more than 1,000 flights as ground crew at several airports including Frankfurt, Munich and Hamburg walked out over pay and working conditions.
Though the problem is with airport employers rather than Lufthansa itself, it illustrates the landscape those in the aviation industry are currently facing.
Members of the Ver.di union are requesting a 10.5 per cent increase in their wages and they say it will be hard to find new staff if the pay isn’t attractive to them.
"There is still a catastrophic labour shortage among ground handling workers - travellers felt this clearly last summer,” says Ver.di’s deputy chair Christine Behle.
“To change this situation, an attractive wage increase must take place for them. And aviation security employees are entitled to an increase in the surcharges in the collective wage agreements."
The union has also said that many experienced workers are thinking about whether they should quit or retire early.