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LUFTHANSA IMPLEMENTS COST-CUTTING MEASURES; SERVICE SUSPENSION SLATED FOR CHARLOTTE AND PHILADELPHIA

 LUFTHANSA IMPLEMENTS COST-CUTTING MEASURES;
 SERVICE SUSPENSION SLATED FOR CHARLOTTE AND PHILADELPHIA
 NEW YORK, July 29 /PRNewswire/ -- In a move aimed at streamlining and consolidating its operations in the USA, Lufthansa German Airlines will suspend service to Charlotte, N.C., and Philadelphia effective Oct. 25, 1992. The two East Coast cities are among the 20 North American Gateways served by the German national flag carrier.
 A number of factors contributed to the airline's decision. Among them were the recent fare wars; the sluggish economy and recession; lower than projected revenues; and the lack of a feeder network to deliver passengers to these gateways.
 "Although we are disappointed to have to announce these suspensions," said Leo-Ferdinand Henckel, Lufthansa's vice president for corporate affairs, "they are necessary to ensure continued high quality and service for all our customers in the American marketplace. We remain committed to providing product and service excellence on the North Atlantic."
 Launched on Aug. 1, 1990, amid delays by the U.S. Department of Transportation in approving traffic rights, Lufthansa's thrice weekly Charlotte services met initially with high start-up costs, coupled with weaker than anticipated revenues. According to Uwe Hinrichs, Lufthansa's vice president for the southern region, "We still believe in the strong economy of the Carolinas and their future development. We have many loyal clients here, and we intend to stay in the Carolinas and continue to help this region build strong international ties."
 In Philadelphia, Lufthansa's second oldest American gateway, both a passenger and cargo sales presence will be maintained. The carrier has served the city since 1965, with daily summer service beginning in 1967.
 Lufthansa has instituted several cost-cutting measures to bolster its economic results. Earlier this year, the company announced a hiring freeze and implemented an early retirement plan. Twenty-three underutilized or unsold aircraft have been taken out of service and parked in Arizona until the market improves, while deliveries of some new planes have been delayed or postponed. In the area of executive management, restructuring is taking place and the sakes and marketing functions have been realigned to better reflect the needs and requirements of the customer-driven, service-oriented industry.
 While Lufthansa carried a record number of over 25 million passengers in 1991 -- a 12.1 percent increase over the previous year -- record losses of over $500 million have been posted for 1991 and the first quarter of 1992.
 -0- 7/29/92
 /CONTACT: Charles Croce of Lufthansa, 212-745-0874/ CO: Lufthansa German Airlines ST: New York, Pennsylvania, North Carolina IN: AIR SU:


PS-SM -- NY105 -- 4754 07/29/92 16:14 EDT
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Publication:PR Newswire
Date:Jul 29, 1992
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