Reportedly, up to 35% of leadership positions are to disappear over the next few months. This was confirmed by a Lufthansa Cargo spokesperson who said that the intention was to create a new, leaner and more efficient organisational structure. The spokesperson said the consolidation in staff would serve to “speed up internal decision-making processes,” making the business “faster and more straightforward," which is intended to benefit the customer.
The cuts will also contribute to a more competitive cost structure, with annual reductions of €80m anticipated as a result of C40 and its 700 attributed job cuts, announced a few months ago.
In an effort to achieve the leaner structure, as of 1 January 2017, the carrier will establish a total of eight regional management units that report directly to the Board Member Products & Sales in its global sales operation. “The local Lufthansa Cargo sales and handling managers will slot in directly below these regional management units in the organisation structure in the future,” the spokesperson went on to say. “These positions will be filled, where necessary, in the coming weeks so that we can be fully effective from the start of the New Year.”
The reasoning behind C40 and the cost-cutting was reinforced in August following Lufthansa Cargo’s fifth consecutive quarterly operating loss. These results were not altogether surprising in light on the continued incidence of overcapacity in the air cargo industry, which has seen many carriers record dwindling profits.
The German airline group’s logistics business, which includes Lufthansa Cargo, ULD specialist Jettainer and its other investments, also recorded a 16.4% year-on-year decline in second-quarter revenues to €496m, but it is hoped these poor results stand to improve as the new organisational structure is rolled out. Only time will tell if this is true.
