It is hoped that the removal of 700-800 full time employees within the company will release some €80m a year, therefore contributing generously to the carrier’s aim to preserve funds. Additionally, the savings will allow the carrier to concentrate on new products and innovative solutions by having a more cost competitive structure, the airline said.
Of the 4,600 people that Lufthansa Cargo employees, many of the cuts will take place through early retirements, the carrier said, and up to 500 of the redundancies will be in Germany. Further details on the exact format of the cost-cutting measures are to be divulged in the coming months.
Achieving competitive costs is very important to Lufthansa cargo at a time when financial figures are on the decline. Last year, the Lufthansa Logistics division, which includes Jettainer and Aerologic alongside Lufthansa Cargo, recorded just €3m Earnings Before Interest and Tax (EBIT), down from €123m in 2014. In the first quarter of this year, the cargo division recorded an EBIT loss of €19m compared with a €52m profit in 2015, as overcapacity and weak demand took effect.
According to Lufthansa Cargo, therefore, the Cargo Evolution masterplan offers many positive benefits, alongside the regrettable job losses. The airline said: "These job cuts will be as socially acceptable as possible. Working with our co-determination partners, we will prepare the implementation of these cost measures over the coming months and provide our company with a new, leaner organisational structure which is based on our customers’ needs.
"C40 will help us to achieve competitive unit costs. At the same time, we want to make it significantly easier to deal with Lufthansa Cargo by making processes more efficient at customer touch points. Lufthansa Cargo’s global network reach and capacity offer will not change as a result of C40."
