Lufthansa CEO Carsten Spohr seems to think the labor strikes besetting the German airline impact employees most of all and will soon be resolved. But days after the interview, I remain thoroughly confused about how he can come to such a conclusion.
Lufthansa CEO Thinks Strikes Will End Soon…Is He Serious?
I enjoy watching Quest Means Business on CNN and was happy to see Richard Quest interview Spohr last week. But much like One Mile At A Time, I walked away with a lot more questions than answers.
"I think our staff knows that strikes also are ruining their business model as individuals…in our industry, customers become unhappy. Customers choose other hubs."
Lufthansa CEO Carsten Spohr addresses recent cabin crew strikes. pic.twitter.com/Ja5EBNaRfd— Quest Means Business (@questCNN) March 21, 2024
Spohr explains the more frequent industrial action we’ve seen this year on the combination of inflation and full employment in Germany:
“We have a unique situation of high inflation of the last years and full employment, and that combination I think Germany hasn’t seen in a long, long time, that’s why we indeed see a frequency of strikes in Germany we haven’t seen in a long, long time.”
I don’t disagree that inflation plus low unemployment creates conditions that favor workers. But while he’s probably not wrong, if memory serves me there were fairly frequent strikes before the pandemic as well.
He’s confident the worst of the strikes are over:
“But when it comes to Lufthansa negotiations, I’m quite optimistic that we have seen the worst, and we are now coming to an end of this.”
I’m not sure how he comes to that conclusion… especially when the two sides do not appear to have made any progress. I would think that the lack of progress would cause more anger and stir more industrial action by the affected work groups.
Quest pressed this issue and to defend his assertion that the strikes will soon be over, Spohr seems to suggest that striking workers will bear the brunt of the cost of these strikes:
“Lufthansa being a group, we introduced a few years ago that every internal strike is allocated as cost to the labor group which goes on strike, so that has a discipline element attached to it, which in my view makes people understand that internal strikes eventually come to their own disadvantage.”
It is this assertion that has not been clarified and I am hoping someone can clarify it in the comments section below. Is he perhaps talking about profit sharing…that profit sharing is somehow allocated to each labor group and such industrial action diminishes profit and therefore ultimately diminishes profit sharing?
Or does he mean that the Lufthansa Group will just put more resources into Austrian, Brussels, or SWISS if this continues…or perhaps continue to form new subsidiaries that slowly erode wage gains over time by creating new divisions in which employees are paid less for essentially the same work?
Spohr adds that employees will come to their senses when they realize that their actions are hurting customers:
“I think our staff knows that strikes also are ruining their business model as individuals…in our industry, customers become unhappy, customers choose other hubs.”
Wait, what? Spohr is a former Lufthansa pilot…he knows the games. This isn’t the United States or the United Kingdom. Workers hold a much more powerful position and their concern is themselves…they’ll bring down the ship before they keep working for wages.
Ben covered this and I was hoping I was also just missing something and the comments would clue us in…but I’m still quite unsure as to what is going on. It seems to me–as is always the case–Lufthnsa is going to have to give more and it workers may have to take a little less.
But most importantly for our purposes, the strikes will continue until real progress is made…employees are not going to suddenly wake up and say, “Well, you know I guess these strikes don’t work after all so we’ll just keep working and hope we get a raise.” That’s not how German labor works.
CONCLUSION
I’m truly curious about what Spohr means in some of the statements he made in his CNN interview with Richard Quest. The notion that the strikes are almost over…or that they hurt the individual work groups most of all…strikes me as the sort of hollow threat only fuels resentment.
Well , Lufthansa staff have always treated me well , and the company is very reliable , so …
You can’t fool Germans with inflation, they won’t stand for an inflation-fueled pay cut
@harry … Merkel fooled them with the middle-east migrants .
How so?
Brussels resolved their labor issues at the 11th hour last night. I certainly think he can shift resources elsewhere in the LH group.
The management are out of touch with both staff and customers. Lufthansa does have amazing network coverage, but everything else about it is decidedly mediocre. A reputation for reliability is difficult to build, easy to lose, and even more challenging to regain- Spohr’s cavalier attitude suggests that he just doesn’t fully appreciate the key strength of the airline he manages.
Lufthansa’s change in management can’t come fast enough.
@PM … +1 .
..two recent Biz class flights on LH (4 segments) and 3 of them cancelled with a day’s notice so for biz travel I’d have to leave LH out. I enjoy a good drink on my flights and their alcohol offerings are far superior to what United has , food slightly better, but that can’t compensate for being unreliable. Add the messy FRA airport and overall LH staff attitude and then I’d rather stick with United (in my case). In the German press Spohr is known as a cost-cutter. Except for LH 1st class seems unclear where LH is leading in terms of quality. My german relatives prefer AA/BA via LHR to come to U.S. by now….Also no idea what he means by ” “Lufthansa being a group, we introduced a few years ago that every internal strike is allocated as cost to the labor group ..” since pay and benefits are agreed in the contract (“Tarifvertrag”” between LH and the unions only (like in U.S).
@Norbert speaking of drinks (and going slightly off topic), I can never get over the lack of espresso on their short haul planes. Alitalia used to offer it 15+ years ago on the Super 80, and even Air Dolomiti, a LH subsidiary, serves it onboard Embraers, but Lufthansa can’t be bothered to install machines on A320s. I was thus ‘forced’ to have 100ml of Bombay Sapphire during my last LH flight – departing at 10:45.
Agreed @PM – though LH’s regular coffee is decent. Coffee drinks of all kinds are vital for me, so I have yet to try Austrian which seems to have amazing coffee and food. Might be the last option to be swayed towards a LH group carrier however no Austrian flights ex SFO (my home base)…
“IMAPCT”
Come on man…
Quote: “I’m truly curious about what Spohr means in some of the statements he made in his CNN interview with Richard Quest. The notion that the strikes are almost over…”
An agreement with ground staff was just annouced yesterday while cabin union stated that a solution is insight and that they won’t strike for the time being. That is what he meant.