European airlines seek help to overcome 'worst crisis'

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European airlines seek help to overcome 'worst crisis'

BRUSSELS, Belgium (AP) =97 European airlines appealed Monday for governments=
=20
to help carriers survive the loss of business from the Iraq war, which the=
=20
industry blamed for compounding the "worst crisis in its history." The=20
Association of European Airlines said its 30 member airlines reported a=20
12.3% drop in international passengers from March 17 to March 23, the week=
=20
when the U.S.-led invasion of Iraq began. It said the war was compounding=20
losses from the prevailing economic downturn and the impact of the Sept.=20
11, 2001, terror attacks. "Our industry is facing the worst crisis in its=20
history," said Ulrich Schulte-Strathaus, secretary general of the=20
Association of European Airlines. Schulte-Strathaus appealed for European=20
governments specifically to help cover the cost of extra security measures=
=20
and higher insurance premiums. European Union nations on Friday agreed to=20
loosen competition rules that normally oblige airlines to surrender the=20
slots for their least-used routes to rival airlines. Airlines argued the=20
practice was unfairly punishing airlines that wanted to halt some routes=20
during the war, but didn't want to end the routes permanently.

However EU transport ministers rejected any wider bailout of the industry,=
=20
for now. The Association of European Airlines estimates the Iraq war could=
=20
add $2.5 billion to its members' losses. Meanwhile Monday, Lufthansa said=20
it is in talks to reduce hours for 13,500 flight attendants as the German=20
airline seeks to cut costs. Lufthansa and employee representatives are=20
looking at ways to cut personnel costs under German labor law or the=20
airline's contract, spokeswoman Christine Ritz said.
"We are checking every possibility for overcoming the (war) crisis," she=20
said. Lufthansa has already cut costs and passenger capacity since the=20
Sept. 11, 2001 attacks made passenger demand fall. The airline credits=20
those moves for a 717 million euro ($760 million) profit last year, but=20
warns that the crisis in the airline industry is far from over. Lufthansa=20
could use German law, which permits cuts in worker hours when there is 10%=
=20
less work for at least 30% of workers. The government then pays=20
compensation to the workers. Alternatively, a crisis clause in the=20
airline's collective contract allows cutting the work week from 37.5 hours=
=20
to 36 hours without compensation.


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