Austrian Airlines has received a bailout from both the Austrian Federal Government and Lufthansa, but ecological requirements have been imposed.
The airline has received Euros 150 million in state aid to cover coronavirus-related losses; another Euros 150 million injection of equity capital by Lufthansa and finally euros 300 million as bank loans to be repaid by 2026
The airline says that the Euros 600 million coronavirus rescue package “is designed to support efforts to sustainably safeguard Vienna as an aviation hub in the long term, including its flight connections to Central and Eastern Europe and to long-haul destinations”. (About 120 of the 360 daily flights lead to Central and Eastern Europe).
The airline quotes the Austrian Economic Chambers as saying that the airline and its flight operations at Vienna have Euros 2.7 billion in domestic value creation, 17,500 jobs and EUR 1 billion in taxes and duties.”
In return for the financial assistance from the Republic of Austria, the airline has made “…binding commitments to the Vienna aviation hub linked to strict ecological requirements.”
The details of the ecological commitments are
- Austrian Airlines will shift passenger traffic to the railways on short-haul flights “in as much as an adequate infrastructure is available and direct accessibility to Vienna Airport is ensured based on a travel time of considerably less than three hours”. This commitment is similar to one made by Air France as a condition of its bailout. However, the objective is also to make sure that the airports in Austria’s provincial capitals continue to be connected to a Lufthansa flight hub.
- CO₂ emissions within Austria should be cut in half by 2030.
- Austrian Airlines has pledged to increase jet fuel efficiency by 1.5 percent annually and to reduce average CO₂ emissions per 100 passenger kilometres of the entire Austrian Airlines fleet from 9.55 kg to 8.5 kg by 2030.
- CO₂ emissions are to be reduced by 30 percent by the year 2030 from the comparable level of 2005.
Another significant part of the coronavirus rescue package comes from the close to 7,000 employees who will make “an accumulated crisis contribution of about EUR 300 million by taking salary cuts”.
The more than 1,000 business partners and suppliers of Austrian Airlines will also make a substantial contribution. Contract volume could be reduced by more than EUR 150 million, partially within the context of newly concluded agreements, in part also by means of renunciation.
The entire financing package is dependent on state aid for Lufthansa in Germany, the approval of all corporate bodies and the consent of the EU Commission.
“I am relieved and thankful that we have succeeded together in making Austrian Airlines ready for take-off again”, says Austrian Airlines CEO Alexis von Hoensbroech. “After almost three months on the ground, Austrian Airlines will lift off again and slowly ramp up its flight operations in accordance with international travel guidelines. We look forward to soon welcoming passengers on board our flights once again”, he adds.
