Airlines body IATA demands unions quit picketing

* IATA head calls strikes “nonsense”

* BA CEO says “business as usual” at airline

* Labour issues seen as threat to European profits

By Maria Sheahan

BERLIN, June 7 (BestGrowthStock) – The global airline body slammed
unions for walking off the job at a time when carriers are are
struggling to turn a profit, dealing with a toxic mixture of
ballooning costs, airspace closures and a weak economic
environment.

“Pilots and crew must come down to earth. Strikes at this
time are short-sighted nonsense,” International Air Transport
Association (IATA) Chief Executive Giovanni Bisignani said in
his opening address at the body’s annual meeting on Monday.

IATA said earlier on Monday it now expects the world’s
airlines to post a $2.5 billion profit this year, an improvement
of more than $5 billion from its March forecast. [ID:LDE6560L6]

But airlines in Europe will report a combined $2.8 billion
loss this year, hit by fallout from a volcanic ash cloud that
swept across Europe in April and shut airspace across large
parts of the continent as well as labour strikes, it said.

“Labour needs to stop picketing and cooperate,” IATA’s
Bisignani said.

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Thousands of travellers have been stranded around the world
this year as cabin crew and pilots walked off the job to push
for higher wages or more job security.

British Airways (BAY.L: ) cabin crew on Saturday started a
five-day strike — their latest in a series of walkouts since
March — in a long-running dispute that has so far cost the
London-based airline about 120 million pounds ($173.2 million).
[ID:nLDE653210]

German flagship carrier Lufthansa (LHAG.DE: ) lost almost 50
million euros ($59.7 million) when its pilots went on strike in
February and took its union to court to stop the walkout.

Lufthansa Chief Executive Wolfgang Mayrhuber told Reuters on
Sunday talks with the pilots were progressing but gave no
indication of how close the parties were to an agreement.

BA CEO Willie Walsh, taunted by union leaders for going to
Berlin for the meeting and not staying in London to negotiate,
roundly criticized the Unite union that represents cabin staff.

“They failed in their efforts to ground BA and they will fail
in any future efforts to do so,” Walsh told Reuters on the
sidelines of a Oneworld airline alliance presentation, of which
BA is a member.

Walsh said there was no point at which there would be an
unacceptable trade-off between the savings from the cuts and the
cost of the strikes, the cuts had to be implemented to preserve
the airline’s future.

U.S. airlines have also been struggling to cut labour costs.

American Airlines owner AMR Corp (AMR.N: ) has long maintained
that its labour costs are above industry average partly because
it restructured outside of bankruptcy, while some rivals have
used Chapter 11 protection to slash costs in recent years.

U.S. airlines have also been struggling to cut labour costs.

American Airlines owner AMR Corp (AMR.N: ) has long maintained
that its labour costs were above industry average partly because
it restructured without declaring bankruptcy, while some rivals
were able to slash costs under Chapter 11 protection.

American Airlines Chief Executive Gerard Arpey told
reporters on the sidelines of the IATA meeting his company had a
a staff cost disadvantage of $600 million a year compared to
other major airlines.
($1=.6929 Pound)
($1=.8375 Euro)

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(Reporting by Maria Sheahan, Ben Berkowitz and Adrian Murdoch;
editing by Karen Foster)

Airlines body IATA demands unions quit picketing