Following its issue of a profit warning last week, Lufthansa has announced a turnaround plan for its low-cost Eurowings subsidiary, citing poor margins at the airline compared with its competitors. Eurowings’ revenue is forecast to fall sharply in this year’s second quarter.
Eurowings will be given be a clear focus on short-haul, point-to-point operations and will be standardised with a fleet of A320 aircrft. It will also be simplified with a reduction to one air operators’ certificate, located in Germany.
Lufthansa hopes that these changes will enable Eurowings to cut costs, measured in available seat kilometres, by 15% by 2022.
There will be no integration between Brussels Airlines and Eurowings. A separate turnaround plan is expected for the Belgian-based carrier in the third quarter of the year.