The Lauda managing directors David O'Brien and Andreas Gruber were informative, but determined, on Thursday in virtual company meetings with the German employees. The pressure is great and a closure of the bases on October 31, 2020 is in the room.
Tonight will be decisive for the Lauda bases in Stuttgart and Düsseldorf, because a final negotiation date has been set with the Verdi union. CEO David O'Brien stated in a virtual employee meeting that a deal must be achieved. The German Lauda employees should then receive the collective agreement and give their approval by Tuesday.
In Vienna, all employees of these flying personnel who refused to give their consent were dismissed. In Düsseldorf and Stuttgart, the announcement of the management is even sharper, because either everyone at the respective base agrees or it will be closed on October 31, 2020. Until then, there will only be flights from Stuttgart and Düsseldorf on Friday, Saturday, Sunday and Monday. Managing director Andreas Gruber told the employees that this was related to the current low demand in the market. However, according to co-boss David O'Brien, the aim is to fly again seven days a week.
The manager put the redundancies at the headquarters in Schwechat at around 30 percent of the previous ground staff. You no longer need numerous positions due to the new orientation as a wetlease operator. They primarily want to fly for the Ryanair Group, but also for other carriers, added Andreas Gruber.
David O'Brien repeatedly emphasized that there is no job guarantee even if the new collective agreement is approved in Germany. The situation around the COVID-19 pandemic would be absolutely unpredictable. According to experts, the level of the previous year could be reached again in 2023 at the earliest. In this context, Gruber also referred to other, much smaller events that have completely changed the market. The Lauda managing director recalled the ash cloud or 9/11, but said that there had never been a standstill as long as now due to COVID-19 in aviation history. The market after Corona would be completely different and all airlines have to adapt to this.
When asked about the social criteria according to which Lauda would issue dismissals in Germany, O'Brien said that when the respective base closes, the entire workforce has to leave. Due to the current market situation, no job guarantees can be given. The fleet should level off at 30 aircraft. All planned additional machines have been canceled and the leasing contracts for the existing fleet are to be renegotiated in order to be able to achieve possible cost reductions. In any case, there should be no possibility for the staff to switch to Vienna or Palma in the event of a closure from Düsseldorf and / or Stuttgart, because they would already be "overstaffed" there.
David O'Brien also reproached Lauda employees that the Airbus A320s are more expensive to operate than the Boeing 737-800s operated by Malta Air, Buzz, Ryanair and Ryanair UK. In addition, the seating capacity is lower. When asked why they did not get the A320neo, the manager pointed out that, in his opinion, Niki Lauda was forced to lease “overpriced” aircraft from Lufthansa as part of the purchase of the Niki assets. This almost broke Lauda's financial back in its first year of operation. The current fleet would be considerably cheaper. “If there are good offers for the A320neo, then we'll take them. Unfortunately, they don't exist, ”said the Lauda managing director during the virtual company meeting. The contracts for the existing fleet should run for another four to five years.
The reason why Andreas Gruber did not fly Düsseldorf-Vienna was quite remarkable. Reference was made here to the example of Vienna-Stuttgart, where the Lufthansa Group allegedly caused uneconomical prices in order to get rid of the competition. However, the manager did not mention that it was the Ryanair Group that offered tickets for 9,99 euros, sometimes even for five euros, with extremely high availability.
As in Vienna, the German Lauda employees are now called on to put pressure on the Verdi union to get it to agree to the collective agreement. The objection that numerous pilots are organized in the cockpit association, O'Brien dismissed and said that now is not the time for discussions about responsibilities. Either an agreement will be reached with Verdi tonight and the employees in Düsseldorf and / or Stuttgart accept it or it will be closed on October 31, 2020 and the German employees are unemployed. By the way, according to HR manager Robert Wall, there should be no severance payments.
In the mistaken belief that the cost of living in Germany would be higher than in Austria, an employee also wanted to know why the planned salaries in Germany are not higher than those in the neighboring country. David O'Brien said the pay at the bases is not based on the local cost of living. In this context it should be noted that the cost of living in Austria is in some cases drastically higher than in Germany, based on independent statistics. Apparently the questioner was wrongly informed.
Provided the bases in Stuttgart and / or Düsseldorf remain open, the carrier wants to fly daily for Ryanair again as soon as possible. The management did not make any concrete statements about the medium-term planning in the network and referred to the unclear situation due to COVID-19. However, numerous routes would be examined. According to David O'Brien, five Airbus A2021s will be stationed in Palma de Mallorca in 320. Lauda would currently only be saved from collapse due to loans granted by the parent company. The Lauda managing director warned, however: "The loans also have to be paid back."
The further development in Düsseldorf and Stuttgart will be decided by Tuesday according to the latest information.