European airlines are posting better that expected profit guidance due to a healthy summer season but warn unions that changes and cuts still need to happen.
France-KLM said that it had begun to benefit from lower oil prices but it warned unions that the gains from improved demand over the summer would not remove the ‘overwhelming need’ for cost cuts to keep pace with rivals, reports Reuters.
Lufthansa also saw improved performance despite pilot strikes due to a strong demand for flights from passengers in Europe, upgrading its profit guidance.
It shows even the traditional carriers have benefitted from increased consumer confidence in Europe.
Ryanair and easyJet upgraded their full year profit guidance last month following a strong summer.
But analysts warn that despite the temporary ‘sweet spot’, ‘legacy airlines’ like KLM-France and Lufthansa are still battling to compete with low cost rivals against strong opposition from unions.
