An Austrian Airlines (AUA) manager has claimed the struggling company “had lots of bad luck” in the past few months as he warns it will fail to meet previously set goals this year.
AUA co-chief Andreas Bierwirth said today (Fri) the loss-making carrier “will not make our initial target” of making a profit this year. He said being in the black for the first time in years was “possible” in 2011. Asked by the WirtschaftsBlatt newspaper whether reports that AUA could sustain a loss of around 100 million Euros this year were true, he branded the figure as “far from reality.” AUA suffered a loss of 64.7 million Euros last year.
The company was taken over by Germany’s Lufthansa Group in what was widely regarded as an important measure to avoid its bankruptcy. The Austrian government coalition of Social Democrats (SPÖ) and the People’s Party (ÖVP) angered the parliamentary opposition by subsidising AUA with 500 million Euros shortly before the acquisition was sealed. Lufthansa snatched AUA after Austrian-Arabian businessman Mohammed Bin Issa Al Jaber backed out of a takeover. The entrepreneur, AUA bosses and representatives of the Republic of Austria were engaged in intense negotiations for months before he eventually decided not to buy a majority stake in the debt-stricken aviation company.
“We’ve also had a lot of bad luck,” Bierwirth said about AUA’s performance in the first half of this year. Referring to offering connections to destinations in North Africa where civil wars broke out in several countries, he said that “one of the most important pillars of our business activities vanished.” The AUA board manager explained the company acquired two planes to operate between Austria and the region shortly before the riots kicked off. Speaking to the WirtschaftsBlatt, Bierwirth said AUA saw itself forced to restructure its schedules owing to a 50 per cent decline in passenger figures for flights to North Africa.
The tsunami disaster in Japan caused similar passenger figure declines, according to the aviation businessman. “We sold just 45 per cent of tickets for these connections for some time instead of 90 per cent, but I am optimistic about reaching rates we achieved last year from this month,” he said about AUA’s operations between Vienna International Airport (VIA or VIE) and Narita International Airport (NRT) near Tokyo, the capital of Japan. Bierwirth revealed the link to Japan was one of the few direct, long-distance connections AUA has been making a profit with.
The AUA co-chief stressed today that further layoffs were not planned. AUA has around 6,000 employees.
The airline’s works council expressed outrage last month when it emerged that AUA’s executive board decided to pay bonuses of around three million Euros to 150 managers of the company. The panel promised to abstain from paying any bonuses next year if the Vienna-based company failed to get back in the black this year.
AUA, which counted 2.1 million passengers in the first quarter of 2011, is headed by Bierwirth and Peter Malanik. Lufthansa wanted to appoint experienced businessman Thierry Antinori as head of the board as of 1 April of this year. However, the Frenchman announced he had decided not to take on the job just a few days before he was due to take over.