Originally Posted by
NA-Flyer
It seems that the issue is quite serious this time and starting to hurt LH revenues badly.
Indeed. Perhaps a good time for a moment of reflection on the current strategic path and whether a change is appropriate. @:-)
Originally Posted by
NA-Flyer
I feel sorry for these guys at LH top management. Every time they think that they fixed all LH problems then something comes up out of the blue that adds more burden to their existing problems and making it harder and harder to go back on track to compete against the ME3

Yes, horrible "out of the blue" problems:
--competition (we have never seen that before in the airline business...

)
--labor relations (hard to imagine that workers get a bad attitude when their pay and benefits are cut, and their colleagues are made redundant

)
--adverse cost base (centering operations in one of the most expensive places on the planet where the government does its best to penalize you for running your business, and then penalizes you more for trying to make a profit)
So what does LH do?
--1.) Try to cut costs in a structure that makes cost cutting almost impossible. This is not to say cost don't need to be managed, but LH operates from an inherently expensive place and needs to either accept that and adjust their strategy accordingly or start moving to other places.
--2.) antagonize their workforce in a sad attempt at 1.).
A smart, highly trained and highly productive workforce is one of the few real competitive advantages LH has, and they seem to be doing their best to dismantle that advantage.
--3.) whine about competition cutting prices "irrationally" and "unfair government subsidies, while ignoring their own gutting of their product value proposition (along several traditional marketing lines: product, pricing, positioning, and promotion). Instead of calling out more publicly and directly their own politicians who are making life for LH difficult, they are complaining about governments who are making life easy for their competition. Seems to me like the logic is a bit backwards.
So given their core challenges, LH seem to be responding by emphasizing their weaknesses and diluting their strengths. Brilliant plan! Good luck with that...
Originally Posted by
Lack
You'd think by now they could anticipate the unions throwing a fit with every new outsourcing attempt LH managament makes...
Yes, you'd think, but we are after all talking about the LH Vorstand.
