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October 13, 2009

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Lufthansa to meet target on cost cuts

DEUTSCHE Lufthansa is on course to meet its cost-cutting targets, the chief executive of the German flagship carrier said yesterday.
"We are on track in all areas," Lufthansa Chief Executive Wolfgang Mayrhuber told journalists at a news conference for the relaunch of its on-board broadband Internet service FlyNet.
To safeguard profitability in the downturn, Lufthansa has said it plans to cut 1 billion euros (US$1.47 billion) of annual costs by 2011. It will cut several hundred jobs at its passenger airline business and said it could defer some aircraft orders.
Lufthansa has forecast a full-year operating loss for its cargo business and has said it could also post a loss in its passenger airline if it cannot cut costs fast enough.
Lufthansa will introduce on-board Internet access again on its long-haul flights from next year, allowing passengers to send SMS messages, transfer data via smartphones and use the Internet via laptops.
The airline's first attempt more than six years ago failed to take off properly as Lufthansa's partner at the time, Boeing, withdrew the service. Lufthansa now cooperates with Panasonic.
"On long-haul routes we offer business travellers a range of communications options on par with powerful hotspots or upmarket hotels," Mayrhuber said.
Lufthansa plans to start the service on 50 aircraft next year and the remainder of its fleet in the following one to two years, it said. On-board broadband will so far only be introduced on Lufthansa planes and not other airlines it owns.
Lufthansa shares rose 1.4 percent to 11.965 euros in early morning trade yesterday in Frankfurt, in line with the German blue-chip DAX index.


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