Maximizing Profit Sharing: Strategies for Success in the Aviation Industry

2024-03-07 16:33:00

Profit sharing

A profit margin of at least five percent is necessary in order to be prepared for future crises. In addition, long-haul aircraft are to be purchased for three billion euros (list price). The AUA management has decided to target a margin of 5.5 percent this year too.

“We will be paying out more than 30 million euros in bonuses to all employees in these weeks,” says Mann. “This is unique in the history of Austrian and we hope that we can repeat it in 2024.” The profit sharing is distributed based on the collective agreements of the on-board and ground staff.

One month’s salary

“With the 30 million euros, we will distribute up to one month’s salary to the employees, depending on which regulations the colleagues are subject to,” says AUA board member Francesco Sciortino. “Of course, this also affects the current collective bargaining negotiations because it is part of the remuneration.” He hopes that there will be no more strikes and that no flights will be disrupted. “We expect a willingness to negotiate and a concession from the union and the works council. But we are also ready to accommodate,” says Sciortino.

The AUA leadership only offered the on-board employees’ negotiators a base amount of 4.5 percent. “We can also imagine an increase if the term is increased. We are in the area of ​​Austrian inflation,” says Sciortino.

Dumping prices

Meanwhile, the union is calling for AUA on-board salaries to be increased to Lufthansa levels. And these premium salaries are around a third higher. “The union is demanding 40 percent, of which 30 percent goes to the salary increase and another ten percent to other aspects such as more vacation,” says the manager.

He calculates: If the AUA paid this 40 percent increase, then the AUA would make a loss. “This requirement makes it very challenging. It is higher than the entire annual result for 2023,” says Sciortino. “I can’t imagine that the union seriously believes that we can increase salaries by 40 percent.” Addendum: “We would like to sit down at the table and call on our colleagues from the works council and the union to come to realistic regions .”

Meanwhile, AUA manager Michael Trestl points to the special competitive situation in Vienna. “The revenue per passenger is lowest in Vienna and significantly higher in Frankfurt, Munich and Zurich,” says Trestl. “We are in direct competition with low-cost airlines that enter the market with dumping prices.” In Vienna, the share of low-cost airlines is around 25 percent.

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