“Mirror” report: Berlin plans to enter Lufthansa directly



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In its report, the magazine relied on information from negotiating circles. According to “Spiegel”, € 5.5 billion should flow to the affected Lufthansa in the form of silent participation from the German federal government. In return, the German government demands a guaranteed dividend of nine percent.

In addition, the state wants to get a direct 25.1 percent stake in Lufthansa, according to “Spiegel,” which should cost just under a billion. The state credit institution for reconstruction (KfW) should contribute another 3.5 billion euros. The government wanted to provide a guarantee for this, he said.

Lufthansa is silent.

A Lufthansa spokeswoman declined to comment on the report on demand. According to various media reports, negotiations on the aid package are still ongoing. The “mirror” report obviously refers only to the government side. However, an agreement must also be reached with Lufthansa on the terms of the support package.

Lufthansa aircraft

Reuters / Kai Pfaffenbach

Due to the coronavirus pandemic, flight operations at Lufthansa have almost completely stopped.

Financial support, which Austria, Belgium and Switzerland provide to Lufthansa subsidiaries, Austrian Airlines (AUA), Brussels Airlines and Swiss, must be accounted for for federal aid according to the “Spiegel”. There is a corresponding decision from Switzerland, the AUA has requested help.

In short: participation is not off the table

According to Federal Chancellor Sebastián Kurz (ÖVP), the participation of the Republic of Austria in Lufthansa in exchange for AUA state aid is not off the table. On Wednesday there was a meeting between the Chancellor, Deputy Chancellor Werner Kogler (Greens), Finance Minister Gernot Blümel (ÖVP) and Secretary of State Magnus Brunner (ÖVP) with Lufthansa CEO Carsten Spohr. State aid for Lufthansa’s subsidiary, AUA, is only available if the location is secure, Kurz said Wednesday night at ZIB2.

Austrian Airlines Headquarters

“It is and remains a German company, so there must be a return for state aid,” said the chancellor. “We need the center in Vienna,” Finance Minister Gernot Blümel (ÖVP) said on Thursday. He kept a low profile on possible Republic involvement in the German airline Lufthansa in exchange for AUA help. “We still cannot say what will come out of the negotiations.”

Transport and Environment Minister Leonore Gewessler (Greens) insisted that the AUA bailout must be linked to climate regulations. “In the end, the taxpayer and the weather should have some of that, and that’s where the talks start,” he said. In exchange for state aid, FPÖ leader Norbert Hofer demanded that the Republic participate in the company. “Regarding the ecological requirements put into play by the Greens,” Hofer warned “against ideological requirements.”

Pilots offer salary exemption

Meanwhile, Lufthansa pilots offered their employer a substantial exemption from wages as a contribution to the company’s restructuring. In mid-2022, pilots would be willing to lose up to 45 percent of their salary, its Association Cockpit Association (VC) said Thursday. Short-term employment benefits can also be reduced. Due to the drop in air traffic, the pilots also started working for the first time for a short time.

Closed shop in Vienna

The concessions would free Lufthansa of a total of € 350 million. In return, the corporate board must do everything possible to overcome the crisis together with the employees. Staff in the higher pay area want to take on their special responsibility, “even if it means painful cuts,” said VC chief Markus Wahl. “It is important to preserve jobs and agree on protection against dismissal.”

Unions want to work together

The UFO hostess union, with which Lufthansa has been in a violent dispute for the past two years, wants to put past conflicts aside in the face of the threat of crisis, as explained by UFO Managing Director Nicoley Baublies. “We would like to finally create the conditions together again,” said Baublies. UFO is ready for crisis talks on a pact to secure the future and jobs. But in exchange for worker concessions, there must be a promise of job security. The losses are likely to be only temporary.

Previously, Lufthansa had released a joint statement by Spohr with the top leaders of the Verdi and VC unions to the German government on the discussion of the state’s multi-billion dollar planned rescue package for Lufthansa. In it, employers and unions emphasized that together they want to ensure Lufthansa’s competitiveness and employment. As a group of Lufthansa / Eurowings airlines and its subsidiaries Swiss, Austrian Airlines and Brussels Airlines, the group must remain the world’s third largest airline.

Lufthansa Carsten Spohr CEO

Reuters / Andreas Gebert

Lufthansa boss Carsten Spohr rejects too much state influence

The discussion has been going on for weeks.

The discussion about state aid to Lufthansa that had been going on for weeks recently had become increasingly controversial in Germany. The CDU / CSU and SPD coalition parties disputed how strongly the state should intervene in the company in the future. Social Democrats demanded that state participation in Lufthansa, which was privatized in 1997, ensure that they have a say, for example, about employment.

Verdi Vice President Christine Behle confirmed: “State aid is when it protects everyone. That is why it is important to combine urgently needed government loans with obtaining jobs and conditions. Spohr rejected too much state influence compared to the weekly “Zeit”. On the back of his hand, Lufthansa threatened to go through insolvency proceedings instead of being overwhelmed by the state. This is a horrible scenario for unions because it makes it easier for a company to lay off its employees.

Ryanair threatens to shut down Lauda

Ryanair threatened to close its Austrian subsidiary Laudamotion in Vienna on Friday. Lauda planes would be replaced by Ryanair planes if the workforce was unwilling to cut wages and new employment contracts, the head of Irish low-cost airline Michael O’Leary said in an interview with Reuters. Talks between Lauda and the union are difficult. “We set a deadline for May 20,” said O’Leary. If the employees refused, Lauda’s base in Vienna would be closed. “If we close Lauda, ​​she will return as Ryanair: bigger and more aggressive than ever Lauda.” Ryanair joined the airline founded by Niki Lauda in 2018 and took over in January 2019.

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