It was a shocking development: a pilot's strike called at Lufthansa (DLAKY ), the German airline that long has steered clear of worker unrest. In the middle of the turmoil: one of Europe's most effective business leaders, Chief Executive Jurgen Weber.
Weber, 59, already had star status for avoiding the huge losses that have plagued other European carriers. But the strike tested his ability to keep the legacy of his tough-love restructuring intact. Before the two sides agreed on May 22 to go into arbitration, the strike had grounded hundreds of Lufthansa flights for two and a half days and cost the carrier more than $50 million.
Weber will have to work hard to recover from that blow to maintain Lufthansa's recent sterling record: In 2000, for the fourth year in a row, Deutsche Lufthansa put in the best operating performance of any European airline. But that's not enough for Weber, who piloted the carrier through a difficult overhaul in the 1990s and subsequent privatization. His new plan to keep the carrier flying high, code-named D-Check, harks back to Weber's days as aircraft maintenance chief. In airline lingo, D-Check refers to the most comprehensive inspection an aircraft undergoes. Weber, an engineer with a blunt approach, is about to give all of Lufthansa a D-Check.
The pilots don't want Weber's D-Check to unveil new ways for management to squeeze costs at their expense. But it's hard to argue with the chief executive's results. The biggest carrier in Europe, with $14 billion in revenue, Lufthansa posted a 9% rise in profits last year, to $620 million. Operating profit surged 44%, to $940 million, despite a 65% increase in fuel costs. The D-Check plan aims to wring nearly $1 billion a year more in savings starting in 2003. "There's a very thin line between dazzling success and failure in the airline business," says Weber, who travels about 300 days a year and often visits the cockpit. If he can keep Lufthansa soaring, his passengers and shareholders will thank him.