Lufthansa CEO says flagship airline to weigh on earnings

Deutsche Lufthansa AG CEO Carsten Spohr said the company’s flagship airline has continued to weigh on earnings as Europe’s largest carrier grapples with high personnel costs, aircraft delays, and growing competition from the Middle East and Asia. “We’ll likely report strong traffic figures, but unfortunately the gap between the positive developments of the whole group and those of Lufthansa Airlines and City Airlines has widened,” Spohr said at a press briefing in Frankfurt on Monday, referring to third-quarter figures. Lufthansa is set to report the numbers on Oct. 29. The airline already revised its full-year outlook in July, saying at the time that breaking even at its namesake German unit will be “increasingly challenging” this year. In the first half, the Lufthansa Airlines subsidiary had an adjusted operating loss of E427m, compared with an profit of E149m a year earlier. The unit generates over 40% of the group’s annual revenues. “We need to get Lufthansa Airlines back on track,” Spohr said, adding that the target for the 100th anniversary in 2026 is for Lufthansa Airlines to be “a sign of strength, not our problem child.” In response to the slower business, Lufthansa has initiated a savings plan as stiff competition drives down fares and corporate travel hasn’t rebounded fully from the pandemic. Lufthansa is also eliminating its direct daily flight from Frankfurt to Beijing because the airline is deploying fuel-guzzling, older aircraft on that service that are making that route unprofitable. <br/>