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Global Industry News

Lufthansa launches new subsidiary amid union concerns

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Sumit Singh Editorial Lead | Simple Flying

On June 26, 2024, Lufthansa launched a new group airline, Lufthansa City Airlines. The official statements from the company emphasized that this move was intended to strengthen its long-haul hubs at Frankfurt Airport (FRA) and Munich Airport (MUC). However, the pilots' union Vereinigung Cockpit (VC) criticized the decision, alleging it was made to circumvent agreements with the union that included operational restrictions on Lufthansa CityLine.

The Lufthansa Group marked an important milestone as another airline with an independent air operator’s certificate (AOC) began operations. Named Lufthansa City Airlines, the group stated that the airline was established to ensure the strength of its long-haul network complemented by feeder services provided by the newest carrier.

The first rumors about this new airline emerged in early 2022. In March 2022, during a presentation of its 2021 results, Carsten Spohr, CEO of Lufthansa Group, mentioned plans to establish a second regional airline similar to Lufthansa CityLine. This new airline would offer employment opportunities for captains previously employed by Germanwings and shift capacity to airlines with lower costs.

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“Regional airlines will take over more short-haul routes; leisure-focused airlines [and] more touristic routes from Network Airlines,” Spohr remarked at the time.

In March 2023, Lufthansa Group announced that it would launch its newest airline called City Airlines in mid-2023. After some delays, on October 25, 2023, Lufthansa Group confirmed that after obtaining its AOC in June 2023, operations would begin during the upcoming summer.

Lufthansa City Airlines operates alongside Lufthansa CityLine to provide feeder services for its long-haul network. Jens Fehlinger, Managing Director of City Airlines and future CEO of Swiss International Air Lines (SWISS), commented on the positive prospects for sustainable job creation in Germany through this initiative.

According to Flightradar24 data, since beginning operations on June 26, flights have been exclusively operated from MUC to five German airports and Birmingham Airport (BHX) in the United Kingdom. Ch-aviation records show that Lufthansa City Airlines has taken delivery of four aircraft: three Airbus A319ceo and one A320neo.

Despite these developments, VC has expressed concerns regarding Carsten Spohr's comments about winding down Lufthansa CityLine due to existing agreements limiting aircraft size. VC claimed these comments were misleading and reiterated their willingness to adjust terms allowing continuity for Lufthansa CityLine.

“In this respect," VC stated "it is also extremely doubtful whether and to what extent the operation of the new company under the Lufthansa City Airlines brand will be permissible in view of existing collective bargaining agreements.”

Spohr had noted that Mitsubishi regional jets like CRJ900s were nearing end-of-service life following Mitsubishi's acquisition of Canadian Regional Jet program assets in June 2020 after Bombardier ceased production in December 2020.

Lufthansa Group’s statement from October 2023 indicated employees could negotiate conditions for switching from any group airline to Lufthansa City Airlines—particularly targeting personnel from Lufthansa CityLine—now takes on a different tone considering VC's perspective on the matter.

Organizations Included in this History
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Air France introduces free ultra-high-speed Wi-Fi across all aircraft starting in 2025

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Air France highlights new routes partnerships at IFTM Top Resa trade fair

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Sep 24, 2024

Michigan security guards vote against mandatory union dues

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