On September 30, 1957, the company Austrian Airlines Österreichische Luftverkehrs Aktiengesellschaft was founded in the large meeting room of Creditanstalt bank in Vienna’s Schottengasse.
Austrian Airlines: The first flight
An Austrian Airlines aircraft took off for London on March 31, 1958 marking the airline’s very first flight. Austrian Airlines arose in line with proportional political representation from the red (Austrian Airways) and black (Air Austria) precursor organizations. The development of the company in the following years was characterized by political influence, financial problems and the consolidation of the domestic airline market.
On the occasion of the company’s 60th anniversary, Austrian Airlines (“AUA”) is presenting the book “Ein Lächeln fliegt um die Welt. Eine Zeitreise durch die Geschichte von Austrian Airlines“ (“A Smile Flies Around the World. A Journey Through the History of Austrian Airlines” – available in German) on the premises of what is now UniCredit Bank Austria. In particular, the book examines the political influences surrounding the founding of Austrian Airlines. An interesting detail: with the Austrian State Treaty of 1955, the Republic of Austria already regained sovereignty over its own airspace. This is why it required two years until it was able to establish its own airline, according to the author Peter Baumgartner.
“Austrian Airlines was often a political pawn from its founding until it was privatized 50 years later”. The political foundations for establishing the company were first laid in 1957 on the basis of the Air Transport Agreement signed by the Austrian People’s Party (ÖVP) and the Social Democratic Party of Austria (SPÖ). The airline’s very first flight – to London – took place on March 31, 1958.
In addition, financial problems arising from the very beginning resulted in economic turmoil, in light of the fact that Austrian Airlines quickly lacked sufficient capital. It first succeeded in generating a balance sheet profit in 1971 after implementing cost and staff reductions. For this reason, the current Austrian Airlines CEO Kay Kratky called his airline a “small-scale Austrian economic miracle” when speaking at the book presentation. According to CEO Kratky, there was already a dramatic situation “one second before twelve” during the restructuring phase after privatization when the “proverbial cuckoo did not knock on the door first, but was already flying around the company’s headquarters”.
Austrian Airlines: The decade of strategic partnerships
For Austrian Airlines, the 1990s comprised the decade of strategic partnerships. This encompassed the close cooperation with Swissair and the Qualiflyer Group airline alliance, as well as the merger with Tyrolean, Rheintalflug and Lauda Air. Similarly, the change to the Star Alliance after the turn of the millennium generated sales synergies. However, this advantage was overshadowed by terror attacks, SARS, avian flu and renewed financial problems. AUA was privatized after the financial crisis of 2008, with Lufthansa granted the right to acquire the airline.
The takeover was followed by a tough restructuring phase which proved to be successful. The changes were slowly reflected in the airline’s performance indicators. In 2013, Austrian Airlines announced positive operating results again for the first time since 2007. The improved financial situation served as the basis for purchasing a Boeing 777 along with good as new medium-haul aircraft. Parallel to the expansion and upgrading of the fleet, the route network was extended to include destinations such as Chicago, Shanghai and Los Angeles.
According to author Peter Baumgartner, there are two main factors explaining why Austrian Airlines still operates flights whereas other airlines are faltering. “First of all, the privatization and integration in the Lufthansa Group, and second the airline’s employees.” Austrian Airlines CEO Kay Kratky also emphasized this fact in the book. “AUA employees are fighters who manage to get through, even in the most difficult situations and under the greatest pressure”.
Austrian Airlines will make a profit in 2017 for the fifth straight year, and will also be able to boast a passenger record. “For the first time since the company was established, we will transport more than twelve million passengers in one year”, Kratky announced. Moreover, Austrian Airlines will continue to grow in 2018 and obtain its twelfth long-haul aircraft. An additional 150 employees will be hired in connection with the acquisition of another Boeing 777. “Even if Austrian Airlines has not yet reached its goal, it is still in climbing flight”, says a pleased Kay Kratky.
Austrian Airlines: The book:
Ein Lächeln fliegt um die Welt.
Eine Zeitreise durch die Geschichte von Austrian Airlines.
(A Smile Flies Around the World. A Journey Through the History of Austrian Airlines. In German.)
Author: Peter Baumgartner
Published by METROVERLAG
Price: EUR 29.90
Available in specialist stores and in the Austrian Airlines Jetshop: https://www.austrian.com/jetshop
SOURCE: Austrian Airlines Group