Lufthansa Weighs Bigger Eurowings Role as CEO Pushes Budget Plan

Deutsche Lufthansa AG said it may enlarge its Eurowings budget brand to incorporate more subsidiaries, risking an escalation of a dispute with employees already protesting the expansion of the business.

The carrier may fold Air Dolomiti and Brussels Airlines into Eurowings, while further shrinking Lufthansa’s main passenger airline, Chief Executive Officer Carsten Spohr said at a press conference in Frankfurt on Monday.

Spohr’s expansion of Lufthansa’s low-budget offerings has riled workers from pilots to cabin crew concerned that the move will chip away at benefits. Flight attendants have said they may strike over the course of three months from July 1, potentially hurting the airline in the busy summer travel season.

Eurowings was designed as an open platform and is able to accommodate other brands, Spohr said. Lufthansa’s pilots staged on-and off walkouts for about a year, and the action has cost the airline about 300 million euros ($335 million).

A new premium economy offering, to be installed on all of Lufthansa’s long-haul aircraft by September, is generating about 15 percent more revenue than planned, as prices are higher than estimated and pursers on board manage to sell unfilled seats before take off, Spohr said.

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