Collective bargaining dispute with pilots: Lufthansa is pushing ahead with the establishment of a new airline

And again complete states disappear from the flight schedules of Deutsche Lufthansa.

In the corona pandemic, this was because countries created high hurdles for passengers – if they still wanted to travel at all.

During its war of aggression against Ukraine, Russia has now banned planes from 36 countries, including all EU countries, from entering Russian airspace in response to sanctions.

After stopping 47 Ukraine connections per week, the Lufthansa Group had to suspend a further 38 per week to Russia.

Moscow and Saint Petersburg as well as Minsk in Belarus can no longer be reached directly from the EU.

Timo Kotowski

Editor in Business.

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In addition to the major military conflict, there is a smaller collective bargaining dispute within the group.

Talks between the Lufthansa management and the pilots' union Vereinigung Cockpit (VC) ended without consensus - after days in seclusion.

As confirmed by group circles, Lufthansa is now pushing ahead with the establishment of a new operating unit

It should fly more cheaply - not for the second brand Eurowings, but for the core brand Lufthansa on domestic German and intra-European routes from the hubs in Frankfurt and Munich.

According to group ideas, pilots who previously worked for the Germanwings unit, which ceased operations in the corona pandemic, should be offered a perspective there.

Otherwise, Germanwings pilots are threatened with termination on April 1st.

Two readings of one plan

The readings of this plan could hardly be more different between the company and the union.

Marcel Gröls, chairman of collective bargaining policy at VC, warns of a "further fragmentation of the collective bargaining landscape" in the group.

The trade union complained that the move was “short-sighted” and “uncreative”.

In the Lufthansa headquarters you feel misunderstood.

The establishment of the new unit is about "measures to protect people from unemployment," it says.

One cannot understand that such a step is taken as a threat.

Lufthansa sees itself being driven to conversion by market developments.

Personnel costs – including those in the cockpits – would have to fall in order to remain competitive on intra-European routes.

We are talking about savings of up to 25 percent.

Lufthansa pilots are among the best paid in the industry.

Conditions like those for Ryanair staff, including rougher handling, should not exist, but comparisons with Easyjet are already being used for the second brand Eurowings.

Otherwise there is a risk that the Lufthansa core brand will have to increasingly focus on the more lucrative long-haul flights.

On the trade union side, there has been resentment since December at the latest.

At that time, Lufthansa had terminated a perspective agreement that stipulated the operation of at least 325 aircraft under the core brand in return for cost reductions.

The VC saw a "peace agreement" wiped out and countered by terminating the collective wage agreement.

Theoretically, strikes are possible next summer.

Union misses "overall strategy"

On Tuesday, VC representative Gröls reiterated the criticism that the union lacked an "overall strategy" for the group.

The strategy of founding new platforms and closing them again has so far not brought the desired success.

A good two weeks ago, the group announced the establishment of a Eurowings Europe based in Malta – as a replacement for the unit of the same name in Vienna.

According to Eurowings, the change brings benefits to crews at Eurowings bases such as Prague or Stockholm.

They would no longer be subject to double taxation, but would only have to pay taxes in their country of assignment.

This was received with suspicion on the employee side.

The same distrust prevails with regard to Germanwings employees.

Although they have not been in action since the company closed, they are still employed in the group.

Some switched to Eurowings, 80 more are to find a place with Lufthansa in Munich, for the rest - a three-digit number - Lufthansa had announced perspectives in a "new flight operation to be established".

Lufthansa: Operating license for new unit within one year

The group management now wants to implement this after the end of the meeting with the VC.

The new unit is to be set up in the vicinity of the subsidiary Lufthansa Cityline, which also operates feeder flights over short distances, and will have its own operating license after a year at the latest.

The remuneration should be based on the previous conditions at Germanwings.

That would mean two things: Previous Germanwings crews would not have to fear any major cuts, but more pilots would be deployed on aircraft with the Lufthansa logo on different terms than the permanent staff - to the displeasure of VC.

The flight attendants' union UFO also agrees with the criticism.

One is now worried about the crew jobs at Lufthansa Cityline, said the UFO chairman Daniel Kassa Mbuambi to the plans for the new operating unit.

"Such a new platform poses a massive threat, as it has already been announced that production is to be carried out at much lower costs." Ufo fears that the core Lufthansa brand will be split into long-haul and short-haul operations.

The plans should be an issue on Thursday when CEO Carsten Spohr presents the business figures.

Added to this are the consequences of the conflict in Russia, which is leading to higher kerosene costs.

However, tighter capacities are also likely to drive up the freight rates that Lufthansa Cargo demands from customers.

Lufthansa is still working on plans for flights to China, Japan and South Korea, for which the direct route via Siberia is blocked.

Alternative routes – possibly with stopovers – are sought.

Instead of starting east, the route in the other direction around the globe - via Alaska - is also being examined, as was the case in the Cold War.