Exclusive-Lufthansa to cut thousands of jobs in pursuit of efficiency

Core Viewpoint - Lufthansa is expected to announce several thousand job cuts as part of its commitment to efficiency, aiming to reassure investors during its first company-wide capital markets day in six years [1][2]. Group Performance and Financials - Lufthansa's shares rose 3.4% to their highest level in over three weeks following reports of the planned job cuts [1]. - The airline has faced criticism for its inability to cut costs and grow its core businesses, delaying its target of achieving an 8% operating profit margin by 2025 [2]. - The group issued two profit warnings in 2024 and has promised an ambitious turnaround program [2]. Operational Changes - The company plans to reduce its administrative staff by 20% in the coming years, although the exact number of redundancies is still being determined [3]. - Analysts noted that despite having fewer planes and less flying activity than in 2019, the airline business employs 7% more people [5]. Labor Relations and Challenges - Ongoing labor challenges, including a dispute over pensions and the possibility of a pilot strike, may overshadow the upcoming Capital Markets Day [4]. - Any redundancies will affect the entire group, not just the core airline [4]. Strategic Focus - Much of Lufthansa's turnaround hopes are tied to leveraging its new German operations, Discover and City Airlines, which have more flexible labor agreements compared to Lufthansa Classic [6].