Lufthansa offers ‘return flight guarantee’ to allay stranding fears

Lufthansa is introducing a “homecoming guarantee” for any German resident it flies abroad, the air carrier’s CEO said in an interview published Sunday. 

On Wednesday, German Foreign Minister Heiko Maas had announced that Germany would not carry out repatriation flights this summer, as it did at the beginning of the coronavirus outbreak earlier this year when travel restrictions left thousands of people stranded abroad. 

Many are concerned about booking summer vacations abroad, afraid that a coronavirus outbreak in their destination country could prevent them from returning home. 

“We are aware of this (concern), which is why we are introducing a homecoming guarantee. Whoever wants to return to Germany, we will bring back,” Lufthansa Chief Executive Carsten Spohr told the Frankfurter Allgemeine Sonntagszeitung. 

“Be it because they are not allowed to enter the country due to an elevated temperature at their destination, or because they have to be quarantined there, or because of a virus outbreak in the host country — in all these cases there will be a guaranteed return flight,” he said. 

Read more: Berlin’s new airport is finally set to open, its future is up in the air

Bailout looms large

The company is hoping that private plan travel will have a quick return to pre-coronavirus levels.

“We’re expecting a high demand from private travelers by autumn at the latest,” Spohr said. 

Germany’s flagship airline is in the middle of a comprehensive restructuring, including the loss of 10,000 jobs, as it considers how to pay back a €9 billion ($10.2 billion) bailout from the German government, prompted by deep losses recorded as a result of the coronavirus crisis. 

Spohr said the company aims to pay back everything by 2023. 

“It has to be our goal that the taxpayer gets his money back as quickly as possible,” he said.

• Coronavirus: Where the state wants control over airlines

  Aid yes, interference no!

  Germany is throwing Lufthansa a €9 billion ($9.6 billion) lifeline. The government bailout will give the state a 20% stake in the airline, which could rise to 25% plus one share in the event of a hostile takeover bid as Berlin says it seeks to protect thousands of jobs. Economy Minister Peter Altmaier insists there will be no meddling with corporate decisions.

• Coronavirus: Where the state wants control over airlines

  Smartwings seeks smart deal

  The Czech Republic is seeking more control over flight group Smartwings, the parent company of Czech Airlines. Industry Minister Karel Havlicek said the government could even take over the group completely, but executives replied that no one had expressed any such desire for that to happen as they preferred a state-guaranteed credit line to see the company through the coronavirus crisis.

• Coronavirus: Where the state wants control over airlines

  TAP-ping into more state funds?

  Portugal’s flag carrier TAP has asked for a state-backed loan to secure the survival of the company. Employees want more state control through direct financing, with Prime Minister Antonio Costa raising the possibility of nationalizing the carrier. TAP is already 50% owned by the state with a 45% stake held by Brazilian-US entrepreneur David Neeleman. TAP employees hold the remaining 5% in shares.

• Coronavirus: Where the state wants control over airlines

  Survival without aid? No(r)way!

  Indirect state aid has come to the rescue of Norwegian, Norway’s budget carrier that has completed a painful restructuring process and secured a credit guarantee from the government. Major lessor AerCap now holds a 15.9% stake after converting lease obligations into shares. BOC Aviation holds a vital 12.67% stake in Norwegian — and BOC is ultimately controlled by the state-owned Bank of China.

• Coronavirus: Where the state wants control over airlines

  Singapore Airlines now Singa-poor?

  Earlier this month, Singapore Airlines announced its first-ever annual loss in its 48-year history after grounding most of its fleet due to the pandemic-caused lockdowns. The carrier is already majority-owned by the government investment and holding company Temasek, which holds well over 50% of voting stock. The government has always stressed its non-involvement in the management of the airline.

• Coronavirus: Where the state wants control over airlines

  The worst in the pack?

  Of the government-owned airlines, the Gulf carriers Emirates, Etihad and Qatar have often raised eyebrows among rivals in many parts of the world. The latter have said the airlines in question aren’t really playing fair, saying their business model is to crowd out competing airlines at any (state) cost. Before the pandemic, the three carriers had grown disproportionately for years.

• Coronavirus: Where the state wants control over airlines

  State control a common ingredient

  Aeroflot Group, which includes Russian flag carrier Aeroflot, Rossiya and Pobeda, is another case in point. It is 51.2% state-owned. But you don’t really have to look far to find more airlines in this category. Right now, there are roughly 150 state-owned carriers around the globe, according to Wikipedia. It’s not the rule, though, as there’s an impressive total of about 5,000 airlines globally.

  Author: Hardy Graupner

kp/mm (AFP, Reuters)

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