Germany’s flag carrier airline, Lufthansa, has reported that it has cut its losses in the first quarter of 2022. However, the airline also warned that the rising costs in aviation would be passed on to customers.
On Thursday, Lufthansa revealed that it had managed to bring its net losses down in the first quarter of 2022, from around one billion euros in the last quarter of 2021, to around 584 million euros.
In the first quarter of 2022, Lufthansa has seen passenger numbers more than quadruple to around 13 million, up from three million in 2021 when the coronavirus pandemic caused major restrictions to air travel. Demand has risen particularly among leisure travellers, with Lufthansa CEO Carsten Spohr saying that “new bookings are increasing from week to week.” Lufthansa is confident that more people are expected to fly from German airports with the airline this summer for their holidays than ever before.
Recovery for business travel has been decidedly slower, with Lufthansa expecting traffic to reach around 70 percent of pre-coronavirus capacity this year. However, the airline’s cargo division experienced a “record result” in the first quarter of 2022, because of heightened demand for freight amid ongoing problems with global supply chains. This resulted in an operating profit of 495 million euros, up from the 315 million euros recorded in the first quarter of 2021.
All in all, Lufthansa expects to return to “around 75 percent” of its pre-coronavirus capacity by the end of the year.
The coronavirus pandemic took a considerable toll on the Lufthansa group, which includes Eurowings, Austrian Airlines, SWISS and Brussels Airlines, which was only saved from bankruptcy by a government bailout. In a bid to save money, Lufthansa got rid of a significant number of jobs during the pandemic, with 30.000 positions cut since 2020. Lufthansa said late last year that it still had plans to cut a further 3.000 jobs.
Lufthansa’s chief financial officer, Remco Steenbergen, has stated that he expects the airline group’s financial situation to “further improve in the coming quarters.” However, Steenbergen did warn that customers will face higher ticket prices due to rising operating costs, as the surge in the price of kerosene (as a result of the Russian invasion of Ukraine) could have an unpredictable effect on the end of year result.