gum

An agree and a tiny amendment: The Y+ class is allocated in the former square area of Y class thus reducing the sum of Y and Y+ seats altogether.

Therefore the upgrading in comfort of Y+ is accompanied by a loss in overall capacity. That said Lufty can slash some super saver fares.

But it's not as simple as it looks

TRAVELSIG

Even the CEO may want to cringe at this headline of the Wall Street Journal today and perhaps think about a touch more of a PR response from management:

Lufthansa Offers Cots as Pilots Strike Looms

http://online.wsj.com/articles/lufth...oms-1409924988

Perhaps also it would be nice to hear from Management rather than a board member?

"The timing in particular is unacceptable," said Lufthansa board member Kay Kratky of the Friday evening strikes, which will hit commuters, holiday and business travelers.

Generally CEOs don't get involved in PR- in a case like this it would seem though as if damage control really needs to be accelerated.

NA-Flyer

It seems that the issue is quite serious this time and starting to hurt LH revenues badly.

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

Lack

You'd think by now they could anticipate the unions throwing a fit with every new outsourcing attempt LH managament makes...

seat 1a

"Think" is the key word there.

N1003U

Indeed. Perhaps a good time for a moment of reflection on the current strategic path and whether a change is appropriate. @:-)

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...

Yes, you'd think, but we are after all talking about the LH Vorstand.

GBM.flights

Ch-aviation with a piece with a funky title: "Austrian to be reborn as a budget long haul carrier?"

an in other news LH group Aug results should be published tomorrow.

verve

Saw an announcement today on linked-in that LH consulting plans to offer its services in the future also no non-tourism clients. Wondering what success stories they will use to pitch and what capabilities they claim to have.

Joking aside - has anybody ever heared of LH consulting?

Rambuster

More trouble in Vienna:
http://diepresse.com/home/wirtschaft...llektivvertrag

TRAVELSIG

Interesting. What will this mean for the future of Austrian?

oliver2002

The OS/VO construct will remain, the unions point was that former govt owned companies cannot be restructured like that.

ex-koelner

I did, when I used to work for an airport corporation. But never worked with them on a project, so can't comment whether the strategies they propose to their external clients are as smart as the advise that LH's management board gets

TRAVELSIG

A Financial Times article of 08AUGUST which was an interview published with Mr. Spohr under the headline "Lufthansa likely to expand long-haul low-cost ops - CEO in FT" seems to indicate that the advisory firm currently assisting Lufthansa is McKinsey if I understand the story correctly.

YuropFlyer

Swissair, McKinsey, Hunter, Austrian/Brussels

I would sell LH stock if I had some ..

Rambuster

But the €200m cost saving seem to have evaporated with this ruling?
Worst case is that the former staff cost need to be repaid.