Lufthansa Shuts Down CityLine Subsidiary Amid Fuel Crisis and Strikes

Lufthansa announced on Thursday the immediate closure of its regional subsidiary Lufthansa CityLine, withdrawing all 27 of the subsidiary's operational aircraft from scheduled service, citing sharply rising jet fuel prices and mounting costs from ongoing industrial action. The airline said kerosene prices had more than doubled compared to the period before the war in Iran, making CityLine's operations economically unviable. Chief Financial Officer Till Streichert described the decision as a "painful step," particularly for the subsidiary's employees, while framing it as part of a broader three-stage capacity reduction plan. The formal grounding of the 27 aircraft is set to take effect on Saturday, April 18, though in practice CityLine's flight operations ceased immediately, as no flights were scheduled for Thursday or Friday due to ongoing strikes. The announcement came just one day after Lufthansa marked its 100th anniversary on April 15, 2026, a celebration that was itself disrupted by striking pilots and cabin crew demonstrating outside the venue.

Three-stage plan reshapes the entire Lufthansa fleet The CityLine closure is the first of three steps Lufthansa outlined to reduce capacity and cut costs across the group. In the second phase, by the end of the summer flight schedule, Lufthansa will retire four older Airbus A340-600 long-haul jets and two Boeing 747-400s from the core Lufthansa brand's fleet. In the third phase, during the 2026/2027 winter schedule, short and medium-haul capacity will be reduced by a further five aircraft. At the same time, Lufthansa's holiday subsidiary Discover Airlines will expand more rapidly, receiving nine additional Airbus A350 long-haul jets. Streichert cited "sharply risen kerosene prices" and "geopolitical instability" as the primary drivers of the fleet restructuring, while stating that the end of CityLine had been "planned for a long time as part of our strategic further development." The group also announced plans to reduce administrative costs, targeting savings in recruitment, internal events, and external consulting, complementing an already announced plan to cut 4,000 administrative positions by 2030.

Lufthansa capacity reduction plan: CityLine aircraft (before: 27 aircraft in scheduled service, after: Permanently withdrawn from April 18, 2026); Long-haul fleet (core brand) (before: Includes 4 A340-600s and 2 Boeing 747-400s, after: Retired by end of summer 2026); Short/medium-haul (core brand) (before: Current capacity, after: Reduced by 5 aircraft from winter 2026/2027); Discover Airlines (before: Current A350 fleet, after: 9 additional A350s added)

Unions call the closure war against employees The closure drew sharp condemnation from the two unions involved in the ongoing dispute. The cabin crew union UFO interpreted the move as direct retaliation for the strikes, which had caused hundreds of flight cancellations at German airports throughout the week. „We are shattered and shocked by so much unscrupulousness. This is open war against their own people.” — Harry Jaeger via Reuters Andreas Pinheiro, president of the pilots' union Vereinigung Cockpit, confirmed that strikes at Lufthansa and CityLine would continue on Friday as planned. Lufthansa CEO Carsten Spohr had previously complained that the core brand was no longer generating a profit on some shorter routes, a claim unions viewed as a prelude to punitive action. Lufthansa stated it did not intend to negotiate a collective social plan with UFO, with discussions on a social plan for the approximately 500 pilots and 800 flight attendants to be held with operating partners instead. The announcement landed during what the group had intended to be a celebratory anniversary week, with five strike days called by UFO and Vereinigung Cockpit alternating throughout the period.

418 (million euros) — total cost of social conflicts to Lufthansa Group in 2023

Around 2,100 jobs at stake as transfer offers face resistance Approximately 2,100 CityLine employees are affected by the closure, according to the company. Lufthansa said it would seek opportunities for continued employment within the group, with positions offered at other subsidiaries including City Airlines, a lower-cost carrier established specifically to operate at reduced cost levels. However, many CityLine employees had already rejected previous transfer offers to City Airlines, according to reporting by Wirtschafts Woche. Streichert said the goal remained to offer CityLine crews "options for a professional perspective within the Lufthansa Group." A formal social plan must be concluded before the operation can be legally closed, and discussions with operating partners on that plan are yet to begin. Lufthansa specified it would not engage with UFO in those social plan negotiations, a position the union described as a further act of bad faith.

Lufthansa CityLine was founded in 1958 and specialized in regional connections to and from the Frankfurt and Munich hubs. The airline operated as a wholly owned subsidiary of the Lufthansa Group, which also includes Swiss, Austrian Airlines, Brussels Airlines, and Eurowings. Social conflicts cost the Lufthansa Group a total of 418 million euros in 2023, of which 53 million euros was attributed to CityLine alone. The group recorded a net profit of 1.67 billion euros in 2023, up from 791 million euros in 2022, but had flagged expectations of a declining operating result going forward due to normalizing demand and persistently high costs.