Lufthansa confirms huge Airbus, Boeing order

Airline says deal represents largest single private sector investment in history of German industry and will safeguard 13,000 jobs

Lufthansa unveiled a $19 billion order for 59 wide-body jets yesterday, split between Airbus and Boeing, to replace its ageing fleet as it fights to win customers from fast-growing Middle East and low-cost rivals.

The deal will see Lufthansa launch a new and larger version of Boeing’s 777 long-range aircraft and expands on a sweeping fleet renewal by Europe’s largest airline by revenues after it signed up for 100 Airbus short-haul aircraft in March.

Lufthansa said the order for 34 Boeing 777-9X and 25 Airbus A350-900 jets, which the supervisory board had approved on Wednesday, would help it cut fuel consumption and shrink unit costs by about 20 per cent compared with old aircraft models.

The carrier said it had also taken out options on another 30 of each type of aircraft.

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Lufthansa is in the middle of its most aggressive corporate restructuring campaign in two decades, which includes 3,500 job cuts, and is investing in modern aircraft to cut its fuel bill and catch up with rivals, particularly on routes between Europe and Asia.

Outgoing chief executive Christoph Franz warned against any let-up in restructuring efforts needed to pay for the new aircraft and better cabins, and said management was committed to continuing with cost cuts even after his departure.

“Without the successful implementation of [savings programme] Score we will not earn the necessary funds to order these planes,” Mr Franz, who is stepping down next May to join Swiss drug-maker Roche, told a news conference in defence of cost cuts that have faced opposition from labour representatives.

According to Lufthansa, the group’s latest order represents the largest single private-sector investment in the history of German industry, and will safeguard about 13,000 jobs at Lufthansa alone. “Any company investing billions of euros has to believe in the economic viability of its business. And we do,” Mr Franz said. – (Reuters)