Lufthansa CEO: Austrian Air Buy: AUA Has Cost Problem
September 03 2009 - 6:38AM
Dow Jones News
German carrier Deutsche Lufthansa AG (LHA.XE) expects to turn
its new acquisition Austrian Airlines AG (AUA.VI) to profit soon,
but a firm target hasn't yet been set, Lufthansa's chief executive
said Thursday.
"We will get to work now to set a target for turning Austrian
Airlines to profitability as soon as possible," Lufthansa Chief
Executive Wolfgang Mayrhuber said, speaking to journalists in
Vienna following the final closing of the acquisition.
He added, however, that the jet fuel price and poor overall
economic conditions are uncontrollable factors that make it
difficult to plan a timetable for the turnaround.
Austrian Airlines was sold after suffering severe financial
difficulty resulting first from high jet fuel prices and later
dwindling passenger figures.
Mayrhuber said Austrian Airlines offers a good product in terms
of service and route network, but that "Austrian Air has a cost
problem."
The Austrian flagship carrier has already initiated stark
cost-cut measures, and Mayrhuber said the efforts will be pursued
further in the future, but Lufthansa hasn't brought a new and
tougher cost-cut program with it to Vienna.
It is a long-term investment, Mayrhuber said, adding that
Lufthansa's target is to keep Austrian Airlines' long-haul route
network intact.
-By Flemming E. Hansen, Dow Jones Newswires; +43 1 513 69 22 10;
flemming.hansen@dowjones.com