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The Lufthansa Group is preparing to announce sweeping job cuts across its European operations as part of a massive cost-cutting and centralization strategy, according to a Reuters report that was released ahead of the company’s first capital markets day in six years (it’s scheduled for Monday, September 29th).
The restructuring aims to reduce administrative staff by around 20% over the next two years. This will affect thousands of employees across Lufthansa’s airline portfolio, which includes SWISS, Austrian Airlines, Brussels Airlines, Eurowings, Discover Airlines, and ITA Airways. As part of its long-term strategy, the Lufthansa Group plans to centralize core functions in Frankfurt. This includes network planning, commercial management, sales, loyalty programs, finance, technology, and airport hub operations, while allowing individual airlines to retain control of their customer-facing products (such as cabin design and onboard service). The move will streamline operations but also lead to significant job redundancies across multiple countries, including Germany, Austria, Switzerland, Belgium, and Italy.
While Lufthansa has pledged to preserve the distinct identities of its airlines, centralization will reduce the need for duplicate roles across brands. The company has faced persistent criticism for inefficiency, with Lufthansa’s flagship airline operating fewer flights and a smaller fleet than in 2019 and employing 7% more staff.
The job reductions come at a time when Lufthansa is grappling with growing employee costs and mounting competitive pressure from rivals such as Air France-KLM and International Airlines Group (IAG) (which owns British Airways and Iberia). Despite the growth of its low-cost subsidiaries like Eurowings and leisure-focused Discover Airlines, Lufthansa’s core brand continues to be described internally as a “problem child” as it struggles with bloated operations and rigid labor contracts.
Efforts to modernize employee contracts with more flexible work rules have faced strong resistance from unions. Lufthansa recently encountered coordinated strikes by flight attendants and ground workers in April, costing the company an estimated €350 million ($372 million) in a single month. In addition, pilots are currently threatening further strike action over pensions, which creates further uncertainty as the company prepares for a turbulent restructuring period.
CEO Carsten Spohr, who has led the Lufthansa Group since 2014, faces growing scrutiny from employees, passengers, and shareholders. Spohr has previously attempted to cut costs by outsourcing flights to cheaper subsidiaries (such as Lufthansa City Airlines). However, these measures have not delivered the desired efficiency gains. The upcoming capital markets day will be a critical moment for Spohr to reassure investors and justify his leadership as the airline group struggles to rebuild confidence across its workforce and customer base.
The September 29th announcement is expected to outline a comprehensive roadmap for restructuring, with a strong focus on:
- Centralizing operations to eliminate inefficiencies.
- Reducing administrative overhead across the airline group.
- Investing in modernization, including new aircraft and passenger experience upgrades.
- Positioning the Lufthansa Group for long-term competitiveness against European rivals.
Lufthansa’s ambitious overhaul comes at a pivotal moment. While the group seeks to regain financial strength and operational focus, the human cost of the restructuring is expected to be significant, with thousands of employees facing uncertainty about their future. The cuts will mark one of the largest workforce reductions in Lufthansa’s history. This symbolizes the airline group’s determination to reset its structure and strategy ahead of its 100th anniversary in 2026.
Anthony’s Take: Running an airline is not easy and a group this size even more challenging. The industry continues to shift and restructuring in a thoughtful way will keep the airline group from bankruptcy. It’s awful that thousands of jobs will be lost, but hopefully the Lufthansa Group will come out stronger and more profitable.
(Image Credits: Lufthansa.)
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