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Lufthansa was once a proud symbol of Germany Inc., standing for the quality and smooth functionality of Europe’s No. 1 economy. But that was before the last week, when a strike by the airline’s pilots stranded more than half a million passengers. As of Wednesday, 4,461 flights had been scratched over six days, with no end in sight to a dispute over wages for pilots. The Lufthansa pilots’ union, known as Cockpit, counts just a few thousand members, but they have the power to paralyse the airline as it grapples with myriad challenges, in particular the growing pains of its low-cost Eurowings affiliate. Lufthansa’s troubles have become Exhibit A in demonstrating how the changes of the 21st century are eating away at decades of cooperation between labor and management that allowed Germany to rebuild and grow after World War II. Those deals, which have given labour a say in management, have allowed Germany to avoid the crippling strikes and violence seen in Margaret Thatcher’s union-busting Britain, say, or over decades in France. But Lufthansa is also the latest example of how the fabled efficiency and competence of some major German companies have fallen into crisis. For Lufthansa, the fight is ostensibly over wages for its pilots, who earn about 30% above the global average, according to Gerd Pontius, of Prologis, the aviation consultant, where he advises more than 50 airlines. The highest-ranked captains easily earn E250,000 a year. While Lufthansa has tried to rebook passengers and keep them moving, impatience is mounting. “Competitors are getting more attractive,” Pontius said. “The strike really drives passengers into the arms of the competition.” Those are the kinds of costs not reflected in Lufthansa’s estimate that each day of the strike costs the airline from E10-15m. The damage over all to the German economy is unknown at this time. Carsten Spohr, the former pilot who is Lufthansa’s CE, knows he has to adapt that motto and squeeze costs.<br/>

Lufthansa offered to decouple pay talks with pilots from its demand for benefit concessions in a bid to restart contract talks following the sixth day of strikes in a week. Lufthansa is willing to increase pilots' wages 4.4% for 2016 through 2018 and grant a bonus retroactive to 2012, Harry Hohmeister, head of the company's network airlines, told cockpit crews Wednesday at a protest rally at Frankfurt airport. The airline will seek arbitration on those terms without tying them to previously sought changes in pensions and other perks. The union has demanded a 20% pay boost for the period from 2012, when the last contract expired, through 2017. Pilots gathered at the airport, Lufthansa's main hub, to mark the last day of a series of walkouts that has prompted 4,500 flight cancellations, sparked hostility from other employees and jeopardized the carrier's earnings targets. The works council representing ground crews, who reached a pay and pensions accord with Lufthansa a year ago, held a counter-demonstration nearby to demand that the pilots agree to arbitration. "This is not about pilot-bashing, but our people are angry, and rightfully so," said Ruediger Fell, a ground-crew works council leader in Frankfurt. "The raise demanded by our pilots is what our workers earn in a month, and the company will try to make up for that spending elsewhere." <br/>

United Continental may convert a $12.4b order for Airbus Group’s largest twin-engine jet to smaller long-range models. It’s also interested in a new Boeing 737 Max that’s still on the drawing board. Those are among the multibillion-dollar changes under consideration as a new management team reviews the Chicago-based carrier’s order portfolio and revamps its fleet strategy, CFO Andrew Levy said. The goal: to close a profit gap with Delta and American Airlines. United is weighing the conversion of Airbus A350-1000s as it looks to replace its fleet of 747 jumbo jets. The carrier could switch to a smaller version of the aircraft, or even the mid-sized A330. That would dent Airbus’s order book, since United is the second-largest customer for the -1000 variant, which took its first flight last week. The airline also is studying the so-called Max 10X, a stretch of Boeing’s largest 737, after deferring 61 of the company’s smallest jets this month. The support from a blue-chip airline customer may help the planemaker close the business case for the proposed new variant, intended to help catch up to sales of Airbus’s A321neo. “These fleet decision are big decisions, they affect your balance sheet for a long time,” said Levy. “These are big capital decisions that you have to live with for a really long time, so you need to make sure you get it right.” The A350-1000 has only garnered 195 total orders, according to Airbus’s website. Levy said United also is rethinking its share buybacks after announcing a $2b repurchase plan this summer that followed a $3b effort from a year earlier. The pace may need to slow because of significant increases in labour expenses from several new union contracts as well as rising fuel costs, he said.<br/>

Turkish Airlines, which has seen profits hit by a weak lira and tough market, plans to lease out eight of its Airbus A330-200 aircraft, aviation company Air Partner said, a move that will help it to reduce costs. The partly state-owned Turkish carrier has been hit by the steady decline of the lira, falling tourism, and stiff competition this year. Its Q3 net profit almost halved to 584m lira ($170m). Aircraft remarketing agent Cabot Aviation, a division of Air Partner, said the Airbus aircraft would be made available on a wet lease basis, which includes crew, maintenance and insurance, or over a longer period on dry lease. "These Turkish Airlines aircraft offer an operator the ability to quickly supplement capacity or test markets," Cabot's senior vice president Greg Cope said. Turkish Airlines could not immediately be reached for comment. Though its passenger numbers increased in the first ten months of 2016, partly due to transit traffic, its load factor fell. <br/>

Air NZ has released a hilarious holiday song for those of us in the Southern Hemisphere who have never seen a white Christmas. Irish singer Ronan Keating and rising star Julian Dennison of Hunt for the Wilderpeople fame have teamed up for the video, shared on the company's social media pages this morning. Summer Wonderland, the Kiwi take on Winter Wonderland is a cheeky ode to pavs, jandals and everything else that makes the holidays here special. The festive track has been changed to make sense Downunder, where "bros" are glistening rather than snow because, as Dennison says, "a lot of people get sweaty down here, it's really sunny". Stand-out lines include "dodging heaps of prickles with your nan" and "gone away is the greeny-brown bird, here to stay are the Jandals". The video ends with Dennison telling the Keating he probably needs to put on 70SPF sunblock.<br/>