Austria’s biggest aviation company will not be back in the black by the end of the year, managers have confirmed.
Austrian Airlines (AUA) – co-chiefs Peter Malanik and Andreas Bierwirth said today (Thurs) – achieved a profit in the third quarter but suffered a loss so far this year nevertheless. They explained that AUA’s loss in the first nine months of 2011 was 31.5 million Euros despite an operative profit of 31.6 million Euros between July and September. AUA will increase its capacities less strongly than planned this winter as a consequence, they added.
“We will not achieve our target – to achieve an operating profit – for the whole year,” Malanik announced today. The AUA manager – who will be joined at the executive board by outgoing Star Alliance boss Jaan Albrecht next week – stressed that AUA bucked the international trend in the third quarter of the current year. The global aviation industry still feels the effects of the revolutionary movements, riots and conflicts in North Africa and the Arab region. Ticket sales for destinations in Japan have not achieved pre-nuclear crisis figures either. The Asian island country was hit by a quake and a tsunami in March. Detonations at a nuclear plant were one of the consequences of the natural disaster in which tens of thousands of people lost their lives.
Bierwirth said AUA planned to retain its position as one of the most popular carriers for destinations in Eastern Europe (EE) via Vienna International Airport (VIA or VIE). Nearly 51 per cent of all flights at VIA are AUA connections. Overall, 2.1 million passengers were recorded at the aerodrome last month, up by 7.7 per cent compared to September 2010. The number of people on services to EE shot up by 19.7 per cent at the same time.
Albrecht recently said: “I cannot imagine Vienna (VIA) without AUA. We will defend the location and expand it together. Our competitors should know that.” The experienced aviation businessman signed a four-year contract with AUA. His assignment came half a year after ex-Lufthansa official Thierry Antinori decided not to join the AUA board just days before he was set to become the airline’s third co-executive manager. Antinori controversially became Executive Vice President Passenger Sales Worldwide at Dubai-based carrier Emirates, one of AUA’s fiercest rivals in offering services between VIA and destinations in the Arab world.
AUA was taken over by German company Lufthansa after several potential investors pulled out from pouring money into the ailing airline in 2009. The Viennese carrier has orchestrated a strict cost-cutting regime ever since. Hundreds of staff have been laid off. Labour unionists are up in arms as AUA intends to continue sacking employees in the coming months.
Lufthansa said today it expected a three-per-cent activity increase itself in 2012. The carrier initially hoped for a rise of nine per cent compared to 2011. The firm’s officials announced decreasing bookings were heralding the developments, adding that cargo operations could be affected by the global economy’s expected cooling off as well. Lufthansa’s operative profit dropped by six per cent to 578 million Euros from the first three months of 2010 to the same period of the current year. The carrier’s turnover rose by 10 per cent to 22.1 billion Euros.
Lufthansa is currently looking for a buyer for its loss-making affiliate British Midlands (bmi). Germanwings, another Lufthansa affiliate, was in the red in the first three quarters of this year too as figures presented today show. Its Basel-based subsidiary company Swiss keeps growing at the same time.
Lufthansa has been headed by Christoph Franz since January. The German followed Austrian Wolfgang Mayrhuber. The carrier has 117,000 employees. It is the European aviation industry’s biggest player.
Meanwhile, one of Lufthansa’s biggest competitors said it would stop giving out bonus cards to German lawmakers. Air Berlin confirmed reports by German daily Frankfurter Rundschau earlier this month. The paper disclosed that the low-cost carrier – which cooperates with Austria’s leading budget airline FlyNiki – started sending the cards to members of the federal Reichstag parliament in Berlin unrequested in 2008. The company headed by ex-Deutsche Bahn (DB) boss Hartmut Mehdorn decided to pull the plug after critics complained about a lack of transparency. The bonus cards helped the politicians to more leg room and other upgrades, according to the Handelsblatt – advantages other Air Berlin customers had to collect air miles for.