Austrian Airlines Gets €450 Million Government Bailout

An Austrian Airlines Airbus A320 cabin

The Austrian government said Monday it is giving Austrian Airlines, a unit of the Lufthansa Group, a €450 million ($510 billion) bailout in order to protect Vienna Airport as a transit hub and safeguard “the bulk” of the carrier’s 7,000 jobs.

The deal includes €300 in loans by a consortium of Austrian banks.  Ninety percent of the loan will be guaranteed by the state.  In addition, the airline will receive €150 in grants, government ministers said at a news conference.

“For us the priority was saving Austrian jobs and in particular securing Vienna as a hub,” said Bundeskanzler Sebastian Kurz.

The deal calls for Lufthansa to provide a ten-year guarantee that Vienna Airport will grow in a manner proportionate to Lufthansa’s other hubs to ensure that the German flag carrier doesn’t favor hubs in Frankfurt, Munich, or Zürich.

The Austrian government is not taking a stake in the airline, unlike the deal between the German government and Lufthansa.

(Photo: Accura Media Group)