Lufthansa plans to restart service to tourist destinations in Europe. The German airline has been hard hit by the coronavirus pandemic and is in talks with the government over a potential bailout.
Lufthansa on Sunday confirmed that it will resume flights to 20 destinations in mid-June as it tries to rebound from the coronavirus pandemic effects. The destinations include vacations hotpots Mallorca, Crete, Rhodes, Faro, Venice, Ibiza and Malaga, a Lufthansa spokeswoman said, with further destinations to be announced at the end of the week. Al flights will depart from the German airline’s main hub in Frankfurt.
The airline has also announced plans to have flights to destinations including Los Angeels, Trornto and Mumbai. The airline is in “advanced” talks with the German government over a potential €9 billion ($9.8 billion) bailout. The deal would include the German government taking a 20% stake in the airline group, which includes Austrian Airlines, Swiss International, Brussels Airlines and Eurowings, and two seats on the group’s supervisory board. According to Bild am Sonntag, a German tabloid, the loan will have to be repaid by 2023. The airline added that if the deal proceeds, the government would receive two seats on the supervisory board, but it would only exercise its full voting rights in exceptional circumstances, such as to protect the firm against a takeover.
The statement noted that some €3 billion of the cash injection would come from the KfW state bank, with the remainder from the government’s economic stabilisation fund, which was set up to deliver aid to businesses affected by the pandemic. A so-called convertible bond from the fund is to be added to this share, which can be exchanged for another 5% plus one share. Reuters cited sources involved in the negotiations said the stabilisation fund had not yet put forward a final offer but was expected to do so on Thursday.
Members of Chancellor Angela Merkel’s center-right CDU party want to give Lufthansa financial protection without influencing managerial decisions, while the left-leaning Green and Left parties are not fans of forking over cash and not having a say. Rival airlines such as the Franco-Dutch group Air France-KLM and US carriers American Airlines, United Airlines and Delta Air Lines have also sought state aid.