While presenting Lufthansa’s (LHAB) (LHA) quarterly results, Chief Financial Office Remco Steenbergen confirmed that the airline was “preparing for layoffs” and intended to “make comparable savings in staffing costs”.
Over the past 12 months, the airline has already cut 24,000 full-time jobs, as outlined in its latest financial update. The additional job cuts will reduce the airline’s total number of staff to 60,000 employees ‒ meaning that the air carrier will have cut 43% of its pre-pandemic workforce.
In October 2020, Lufthansa (LHAB) (LHA) warned that 30,000 jobs were under threat as it was scaling down its winter schedule to levels not seen since the 1970s as the demand for air travel collapsed due to the ongoing pandemic. Later, in December 2020, the airline announced that it expected larger job cuts resulting in massive redundancies of 50,000 employees.
During the first three months of 2021, Lufthansa’s (LHAB) (LHA) operating profit fell to €4 billion in comparison to €8.2 billion for the same period in 2020. While Germany’s flag carrier still burns up to €235 million per month, its quarterly net loss halved from €2.1 billion in Q1 2020 to more than €1 billion in Q1 2021.
Lufthansa (LHAB) (LHA) expects that a stricter cost-cutting strategy would help it to reduce the monthly cash burn to €200 million per month. The airline plans to operate around 40% of its pre-COVID capacity in Q2 2021.