The Covid-19 pandemic not only poses enormous challenges to all societies around the world but also reveals system-inherent weaknesses in German transport policy and the activities of large private companies. Apparently healthy global companies, which have gained profits of several billion euros in recent years, were already screaming for state aid when the economy began to struggle with the effects of the Covid-19 pandemic. The prime example is the Deutsche Lufthansa Group. Less than a year before the Covid-19 pandemic hit Europe, the Lufthansa Group’s Supervisory decided that 10 percent of the company’s share capital should be used for share buyback programmes. For this reason these liquid funds were missing for „bad times“. At the same time, the German government helped the company with state aid of over 9.2 billion Euros and now holds a 20.05 per cent stake in the Lufthansa Group. Instead of buying into the private ownership structure of Deutsche Lufthansa as a state, the German government should declare the transport industry to be a public service and thus provide a basic service, for example by purchasing seat contingents, both for the Lufthansa Group and for the end consumer and taxpayer, so that the overall economic welfare—despite the crisis situation—is stabilised and economic recovery can take place quickly after the crisis. The present paper analyses the case of the Lufthansa Group and evaluates regulatory solutions as to how the Covid-19 pandemic could have been managed in a sustainable and welfare-maximising manner. The present paper follows a theoretical-analytical research approach, with included model-theoretical solutions. In order to maintain services of general interest, the state must purchase transport services to the extent necessary to ensure that the transport companies reach the break-even point in times of crisis, thus ensuring the continuation of business operations while maintaining direct and indirect economic effects.

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Paper 1: Failure of German Transport Policy in the Case of Lufthansa: A Critical Economic Approach

  • Oliver Franck

摘要

The Covid-19 pandemic not only poses enormous challenges to all societies around the world but also reveals system-inherent weaknesses in German transport policy and the activities of large private companies. Apparently healthy global companies, which have gained profits of several billion euros in recent years, were already screaming for state aid when the economy began to struggle with the effects of the Covid-19 pandemic. The prime example is the Deutsche Lufthansa Group. Less than a year before the Covid-19 pandemic hit Europe, the Lufthansa Group’s Supervisory decided that 10 percent of the company’s share capital should be used for share buyback programmes. For this reason these liquid funds were missing for „bad times“. At the same time, the German government helped the company with state aid of over 9.2 billion Euros and now holds a 20.05 per cent stake in the Lufthansa Group. Instead of buying into the private ownership structure of Deutsche Lufthansa as a state, the German government should declare the transport industry to be a public service and thus provide a basic service, for example by purchasing seat contingents, both for the Lufthansa Group and for the end consumer and taxpayer, so that the overall economic welfare—despite the crisis situation—is stabilised and economic recovery can take place quickly after the crisis. The present paper analyses the case of the Lufthansa Group and evaluates regulatory solutions as to how the Covid-19 pandemic could have been managed in a sustainable and welfare-maximising manner. The present paper follows a theoretical-analytical research approach, with included model-theoretical solutions. In order to maintain services of general interest, the state must purchase transport services to the extent necessary to ensure that the transport companies reach the break-even point in times of crisis, thus ensuring the continuation of business operations while maintaining direct and indirect economic effects.