Last Update: at 18:26

Agreement with Austria is close

State aid to keep Lufthansa’s champion status

This week, Lufthansa and the government of Austria intend to agree on aid for Austrian Airlines. The aviation group is not only looking for state aid for reason of survival - but to keep its position.

Switzerland granted Swiss International Air Lines state aid at the end of April. In Germany the state aid package for Lufthansa has been approved by the most important bodies. The only thing missing is the shareholders’ approval. The group’s negotiations for the subsidiaries Austrian Airlines and Brussels Airlines however, are dragging on.

In Austria, the group hopes for an agreement on Thursday, as Lufthansa CEO Carsten Spohr said on Wednesday (June, 3) in a call with journalists. He had just undergone a corona test for a meeting with Austrian Federal Chancellor Sebastian Kurz in Vienna. The negotiations with the Belgian government, on the other hand, «are still at an earlier stage», Spohr said. He said an agreement about state aid for Brussels Airlines is not expected this week.

It is not only  about survival

The CEO of Lufthansa explained that the loans for the subsidiaries in Switzerland and potentially in Austria and Belgium will be discounted from the ones in the German aid package. The loan from the state-owned development bank KfW of up to three billion euros will be correspondingly smaller.

Spohr also made it clear that the «stabilization package» is not a mere measure for survival. The German government also wants Lufthansa to be able to defend its position as «global champion», he said.

Fighting declaration to new slot owners

With regard to the take-off and landing rights that Lufthansa must relinquish in Frankfurt and Munich as part of state aid due to EU requirements, Spohr was aggressive. One would treat the potential new slot owners in the same way as one always treats new competitors. Other airlines had already experienced this in the past, and it would happen again now, he said.

We’re on a break. Due to the Coronavirus pandemic we have decided to halt our English publication for a while and concentrate on our other ventures. But we’ll be back. Meanwhile you can find all our news, insights and more on our German site.