THE AUSTRIAN Airlines (AUA) group has managed to slash its operating losses for 1994 and aims to be in profit this year as it presses ahead with its restructuring.
Group operating losses were held to Sch207 million ($21 million) for 1994, compared with Sch726 million a year ago. The aim is to achieve "a positive result" in 1995 say the joint presidents Herbert Bammer and Mario Rehulka, who first launched the radical restructuring towards the end of 1993,
After calling up cash from depreciation reserves, they point out that the group already showed a modest Sch9 million net profit for 1994, turning around a Sch498 million loss.
The airline cut another 400 jobs in 1994, bringing down employment costs by 6.5% and increasing productivity by more than 11%. This year the plan is for a further 20% increase in productivity and a "dramatic" cut in unit costs,. As part of the cost drive, accounting functions were sent to India in April.
Joint sales and marketing offices with Swissair and SAS within the European Quality Alliance also helped to save costs, and further expansion of international co-operative agreements are coming into effect this year. Washington flights are now to be served jointly with Swissair and its US partner Delta Airlines, while deals with Air China and Malaysia Airlines are also coming into force.
Source: Flight International
