Through the Covid-19 pandemic airlines are stuck in the worst economic crisis of all times. As travel restrictions are rather intensified than eased, airlines nowadays intensively concentrate on minimal cash drain and cost savings to survive this worldwide depression.
As the initially anticipated duration of the massive capacity reductions and the timing of the restart phase turned out to be “wishful thinking”, fast changes and short notice measures cannot meet the necessary cost reductions over this long period of time. Instead, structural changes and sustainable adjustments are needed.
As Lufthansa Group CEO Carsten Spohr expects that after the crisis a new market situation with a concentration of airline groups in each region of the world will be the new reality, also European airline groups need to strengthen their competitive situation. Many international carriers are (partially) owned by national governments and are strongly subsidized during these times. Moreover, as their business is located outside of the EU these airline groups can follow leaner, more competitive organizational structures under their national law instead of EASA.
Therefore, the grouping named Airlines for Europe (A4E), which advocates on behalf of its members to help shape EU aviation policy, is currently driving a change in aviation law for continuing airworthiness organizations (CAMO) to foster a competitive situation for and the possibility of enormous cost savings in European airline groups.
Read the full article here
To learn more and discuss how your organization could benefit from Lufthansa Consulting’s expertise on Crisis Recovery, please get in touch at ALcrisis-solutions@LHConsulting.com
If you are working for an airline, airport, ground handler, OEM, MRO or an aviation authority, we invite you to follow our article series on shaping flexible organizations.
Other articles in the series “Shaping flexible organizations”
The new normal customer: New decision criteria determine how airlines can adapt their revenue management, sales and distribution
A customer experience perspective on how to deal with COVID-19-induced uncertainties
Flexible rightsizing of airline staff in times of uncertainty
Shaping flexible organizations: an organizational perspective
Stronger together: airline partnerships as a means of surviving COVID-19 and thriving thereafter
Shaping flexible organizations: how to deal with COVID-19-induced uncertainties