DEUTSCHE LUFTHANSA has pulled back further from plans to lift capacity and expand its passenger fleet to safeguard profits threatened by soaring fuel prices.
The German carrier says it offered only 0.5 per cent more seats this year instead of 1 per cent, having already shrunk its growth plans several times in recent months. Lufthansa yesterday reported consensus-beating quarterly profit.
Investors hoped that limits to capacity would help boost margins and raise prices.
European airlines have been struggling in recent years with sky-high fuel prices, lower spending on air travel in Europe and fierce competition from low-cost carriers.
Lufthansa’s fuel costs were up 22 per cent in the first six months because oil prices rose and the euro weakened against the dollar.
The carrier plans to reduce capacity by 2.5 per cent for the winter 2012-2013 timetable and will offer 4.5 per cent less capacity at its cargo business this year. It had planned for a 2 per cent cut.
Results are a day ahead of comparable earnings figures from International Airlines Group, formed by the merger of British Airways and Iberia. – (Reuters)
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