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Lufthansa Economy Class Stable As Premium Dives

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Lufthansa said demand for economy class air tickets had been steadying over the past few months but premium travel continued its nose dive.

To cope with weak bookings, Lufthansa has so far this year cut the number of seats it offers at its passenger airlines by 2.6 percent, the German flagship carrier said in a presentation to be held at its Investors Day on Thursday.

It has retired 23 short- and long-haul planes and plans further capacity reductions this year. Lufthansa's total fleet comprises 545 aircraft, including cargo planes.

Airlines around the world are struggling to cope with a drop in demand for air travel amid the global economic crisis. The International Air Transport Association has forecast that the world's airlines are likely to lose USD$9 billion this year.

Lufthansa has reported a 4.4 percent decline in the number of passengers it carried in May, with a load factor that fell by 4.4 percentage points.

The company last week warned it would not be able to post an operating profit as planned this year without further cost cuts given difficult markets.

Around EUR300 million euros (USD$422 million) worth of cost cuts are already underway, by way of measures such as further capacity cuts, staff reductions and the phase-out of some older planes, the presentation showed.

(Reuters)

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