Airline announces new package of cuts
Alfred Ötsch has resigned as the ceo of Austrian Airlines as the carrier announced a new series of cuts.
Dr. Peter Malanik and Dr. Andreas Bierwirth, both chief operating officers of the airline, will take over his responsibilities.
Mr Ötsch, 55, took over in May, 2006. Austrian was taken over by the Lufthansa Group earlier this year.
In a statement Mr Ötsch said: "After three intensive years with Austrian Airlines, this step is designed to enable a new beginning at the company, including at the level of management.
"Having cooperated closely with my colleagues on the Board of Management and the Supervisory Board while introducing the necessary change of course towards partnership, I am glad that the privatisation has now moved into its final stages with Lufthansa, the best possible partner for the Austrian Airlines Group."
The new management said the airline expected a 15% fall in revenue this year.
This amounted to a loss of €225m, even when the falling fuel price was taken into account.
Dr Malanik said measures to save this sum would be implemented including a 5% cut in production which amounted to a 10% cut in capacity.
Three routes would be scrapped, including the long haul service to Mumbai. These would add up to €115m savings a year.
Austrian is also in talks with staff representatives over flexible working hours, cuts in holiday and leave time, a temporary salary waiver and time-limited suspension of pension fund contributions.
The airlines is also in talks with suppliers.
These measures could save €110m, Dr Malanik said.
Dr Bierworth said the medium term aim of Austrian was to improve its performance by €200m a year by 2012 when the current economic crisis should be over.
"Only then would we have an EBIT margin of approximately 6-7%, the level usual amongst European carriers and a solid foundation for future growth in the Group," he said.
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