Germany’s top airline Lufthansa said yesterday that it plans to shed 3,500 administrative jobs over the next few years as part of a radical cost-cutting program.
The unprecedented steep cuts were intended to reduce administrative costs by a quarter, the airline said in a statement.
Cuts in staff costs overall would amount to about one third of the savings under the cost--cutting scheme announced at the beginning of the year, the company added.
The German giant is undergoing an overhaul in the wake of fierce competition from budget airlines and said in February that it aims to save 1.5 billion euros (US$2 billion) by 2014.
“We can only safeguard jobs for the long term and create new openings if we reorganize the administrative functions and accept job losses now,” Lufthansa chief executive Christoph Franz said in a written statement.
On Wednesday, the group said it suffered a net loss in the first quarter of the year as the soaring price of jet fuel more than offset a rise in passenger numbers.
The company posted a net loss of 397 million euros in the first three months of the year, more than the 336 million euros expected by analysts polled by Dow Jones Newswires.
Although the net loss was about 22 percent lower than the previous year, Lufthansa’s operating loss of 381 million euros was about twice as much as last year.
First quarter sales reached 6.6 billion euros — 5.6 percent higher in a year-on-year comparison — but this “could not offset additional costs, in particular for fuel,” Lufthansa said.
The airline confirmed this year’s forecast for stronger sales and an operating profit of about 500 million euros.