Vienna - Troubled carrier Austrian Airlines AG announced Thursday it would take drastic cost-saving measures by downsizing its 8,000-strong staff by 1,000 until the middle of 2010. The flag carrier is currently waiting for the European Commission to green-light its takeover by German airline Deutsche Lufthansa AG. On Wednesday the Commission said it needed to undertake further study of the proposed takeover.
So far, the company has started implementing an austerity package worth 225 million euros (317 million dollars), but its management said in a statement additional measures to improve the business result by some 200 million euros were needed in the next three years.
"The goal is to achieve a considerable reduction of personnel costs through structural improvements and higher productivity," chief executives Andreas Bierwirth and Peter Malanik said.
They indicated that the intention was to avoid firings, relying instead on not replacing retired staff and through mutual agreements on contract terminations.
Owing to high fuel prices and the economic downturn, Austrian Airlines lost 429.5 million euros in 2008 and ended the year with some 1 billion euros of debts.
Austria's state holding agreed in December to sell its 42-per-cent stake in the flag carrier to Lufthansa for 366,000 euros.
