Reporting a “drastic” fall in earnings and bracing for, potentially, a full year of losses, Austrian Airlines management look at low-cost carriers as one of the culprits of its voes, but promise to defend their Vienna hub stronghold from “flooding” no-frills airlines.
“Mr. O’Leary is wrong if he thinks that he can overtake us here in Vienna,” Alexis von Hoensbroech, the CEO of Austrian Airlines asserted during a press conference in Vienna (Austria) on November 11, 2019.
Hoensbroech was supported by the company’s CCO Andreas Otto, who assured that Austrian Airlines are not to give up their position in the hub. “Let me get this straight: We will not retreat a single millimeter on the Viennese market,” said Otto.
The strong rhetoric of Austrian Airlines management comes as the company is reporting its Q3 financial results, revealing, in its own words, a “drastic” fall in earnings. In the first nine months of 2019, Austrian Airlines’ earnings fell by 85% to $103 million (EUR 93 million) compared to the corresponding period in 2018.
Unable to “rule out the possibility” of the entire 2019 financial year falling into reds, the airline points out to competition from low-cost airlines and jet fuel prices as the main headwinds for the airline during this “economically difficult period”.
The Austrian carrier now plans to close all its decentralized bases to focus on ts hub in Vienna International Airport (VIEA), the parent company Lufthansa (LHAB) (LHA) group announced earlier on November 11. Austrian Airlines will also modernize the fleet, with plans to phase out De Havilland Canada Dash 8 Q400 turboprops, replacing them with the Airbus A320 family aircraft. Currently, Austrian has 6 Q400 aircraft in its fleet.