The returned desire to travel after the Corona crisis is driving Lufthansa a lot. While the number of business trips is recovering more slowly, private customers are booking more flights with the Group’s airlines. The demand meets a limited supply on the market – and Lufthansa can therefore enforce higher ticket prices, as announced on Wednesday when the first quarterly report was presented.
After a significantly reduced operating loss of 273 million euros (previous year: minus 577 million) in the traditionally weak first quarter, the Management Board therefore sees the group on course to significantly increase its profit in day-to-day business this year as planned. How strong should also depend on further strikes – at the airports, but also at Lufthansa itself.
Sales increased by around 40 percent to 7.0 billion euros in the first three months compared to the same period of the previous year. The number of passengers was 64 percent higher than at the beginning of 2022, when the Corona variant Omikron was still hindering passenger traffic.
High prices and high demand
The Lufthansa leadership bases its optimism on the strong booking situation for the summer and the increased ticket prices. CEO Carsten Spohr is still expecting an adjusted operating profit this year well above the 1.5 billion euros of 2022. In the previous year, the MDax group was clearly in the black after two bitter years of losses and the rescue by the state in the Corona crisis numbers returned.
While Lufthansa owed its profit in 2022 primarily to a record result from its freight division Lufthansa Cargo, in 2023 the passenger airlines should also bring in significant profits again. In addition to the significantly higher number of passengers, the increased ticket prices should also contribute to this. In the first quarter, the average revenue per ticket was already 19 percent higher than in the same period before the corona pandemic in 2019. In the second quarter, it could even be up to 25 percent more expensive than in the corresponding pre-crisis period, it said.
Not at pre-pandemic levels yet
This is not only due to increased costs, such as for personnel and fuel. Airlines in Europe are still offering fewer flights than before the pandemic, also because the aircraft manufacturers Airbus and Boeing cannot keep up with the delivery of new jets. With the passenger airlines Lufthansa, Swiss, Austrian, Brussels and Eurowings, Lufthansa was only at 75 percent of flight capacity in the first quarter compared to 2019. In the current second quarter it should be 82 percent, for the year as a whole the Executive Board still has 85 to 90 percent considered.
In addition, there is still a lack of staff, especially at the airports. Lufthansa had therefore already canceled thousands of flights in its summer flight schedule in February so as not to overwhelm the entire system and avoid chaos like in the summer of 2022. The company expects further strikes, including among its own people. The danger is particularly high for the flying staff of Eurowings and the pilots of the core brand Lufthansa, whose collective agreement expires at the end of June.
Statement Lufthansa Q1/2023 Interim report Lufthansa Q1/2023
