Domestic Flights

Throughout its 21-year presence at JFK International Airport, Austrian Airlines had handled five aircraft types--the Airbus A-310, the Airbus A-330, the Airbus A-340, the Boeing 767, and the Boeing 777; had assumed four strategies--its initial, independent operation; the Delta Air Lines code share agreement; the tri-carrier Atlantic Excellence station; and the Star Alliance integration; had operated from four JFK terminals--Terminal One, Terminal Two, Terminal Three, and the International Arrivals Building; had been handled by three companies--Delta Air Lines, Lufthansa-German Airlines, and Swissport USA; and had used two computer systems.

Because the talents and abilities of many of the staff had been channeled to produce creative and innovative accomplishments during the last chapter of its existence, JFK had notched up several strengths and successes, some of which had enabled it to play an increasingly nucleic role within North America.  These achievements can be subdivided as follows:

1. The textbooks and courses had subsequently been used to duplicate this success at Austrian Airlines’ other North American stations.

2. The Centralized Load Control (CLC) Department, entailing the preparation of loading instruction/reports and load sheets for the four North American stations of Chicago, New York, Toronto, and Washington, had been highly successful and had once involved four aircraft types: the Boeing 767, the Airbus A-330, the Airbus A-340, and the Boeing 777.

3. Omar himself had often traveled to other stations in order to restructure their Baggage Services Departments.

4. The Ticket Sales-Reservations counter, under the direction of Sidonie Shields, had consistently collected significant amounts of annual revenue in ticket sales, excess baggage, and other fees.

5. The visible presence of Austrian Airlines, in red uniforms, to the passenger, whether worn by Austrian Airlines or Swissport staff.

6. The special flights, such as those carrying the Rabbi Twersky group, the American Music Abroad group, the IMTX group, the Vienna Boys’ Choir, the Vienna Philharmonic Orchestra, and Life Ball, the latter with its high-profile celebrities, colorful characters, and predeparture parties.

7. The special events, including “The Year in Review,” the Pennsylvania ski trips, the summer pool parties, the birthdays, the Thanksgiving dinners, and the Secret Santas at Christmas.

8. And, finally, the daily briefings, the family atmosphere, the jokes, the laughs, the raps, and the human connection which had continually emphasized the life forces behind it all.

Michael Steinbuegl, who assumed command as JFK Station Manager in September of 2005, had cultivated the environment and orchestrated the steps which had allowed every one of these strengths and accomplishments to have been made.

Two Decades of Elasticity

Austrian Airlines, hitherto among the smallest European airlines, had to assume a considerable degree of necessary “elasticity” during its 21 years at JFK, ebbing and flowing in the ever-changing turbulence of prevailing market conditions, seeking financial benefit, synergistic strength, market niche, alliance realignment, and ultimate change of ownership.  Defying Darwinian philosophy, whose “survival of the fittest” prediction is often translated as “survival of the largest,” Austrian Airlines had, despite numerous, necessary redirections, proven the contrary, perhaps prompting a rewording of the philosophy to read, “survival of the smallest”--to which should be added, “as a global player.”

Toward this end, the latest strategy had enabled the carrier to survive.  For station JFK and its staff, however, it had not.

When Austrian Airlines had turned the page of its winter 2008-2009 timetable on March 29, JFK had fielded its first Boeing 777-200ER operation, the carrier’s largest capacity equipment and the fifth basic type to have served New York after the A-310, the A-330, the A-340, and the 767.

The aircraft, having originally been acquired by Lauda Air, had been configured for 49 business and 258 economy class passenger, although two later examples, which had featured higher gross weights and modified passenger arrangements, had accommodated 260 economy class passengers in ten-abreast, three-four-three, configurations.

During the six-month period between April and September of 2009, the single flight had carried 34 percent more arriving and departing passengers, along with significantly increased complements of cargo and mail, than the comparable year-earlier period, when the 767 had been deployed.

The four 777 registrations had included the following:

1. OE-LPA

2. OE-LPB

3. OE-LPC

4. OE-LPD

14. Lufthansa Acquisition

2009 had been a pivotal year for Austrian Airlines.   Because of the global economic downturn, escalating fuel prices, eroding yields, and strong competition within Western Europe from low cost carriers, its financial viability and therefore continued existence as a company had been threatened, despite previously unsuccessful attempts to stem its losses by selling its A-330 and A-340 fleet, reducing its long-range route system, and implementing several restructuring plans.  Its savior, in the form of an agreement with Lufthansa-German Airlines to assume its debt and acquire the majority of its shares, had enabled it to continue operating.

On August 28, the European Commission had officially approved the proposed acquisition of the Austrian Airlines Group by Lufthansa-German Airlines, comprised of the 500 million euro restructuring assistance from the state holding company and the merger between the two carriers, thus paving the way toward Austrian Airlines’ integration into the Lufthansa Group by September.  In order to achieve the required antitrust immunity, Lufthansa had agreed to relinquish key flight slots and reduce the number of services between Vienna and Brussels, Cologne, Frankfurt, Munich, and Stuttgart.  For Austrian Airlines, which would become one of Lufthansa’s many independent, European hub carriers, it had signaled financial survival; an improved economic foundation; cost synergies, such as joint fuel and aircraft purchasing; and access to Lufthansa’s extensive international sales and route network.  Austrian Airlines’ own niche within this system had entailed the establishment of Vienna as a high-performance hub for traffic feed to its dense Central and Eastern European route system.

As a result of this ownership change, numerous, fundamental North American changes had occurred.

In Toronto and Washington, for example, agreements had been reached wherein Lufthansa had assumed the ground operations handling at these stations.

In New York, more than half of its Whitestone, North American headquarters, employees had been laid off and the location, for almost a quarter of a century its “fortress” located on the fifth floor of Octagon Plaza, had been closed, with the remaining staff relocating to Lufthansa’s East Meadow, Long Island, facility, and integrating with its staff.

At JFK, Austrian Airlines Cargo had relocated to the Lufthansa facility on November 1, and 16 days later Swissport had passed the ground-handling torch to Lufthansa-German Airlines.

Michael Steinbuegl, Manager of that station for four years, had been promoted to Key Account Manager, North America, but four Ticket Sales-Reservation positions had been rendered redundant when Lufthansa had assumed those functions, reducing the Austrian Airlines’ staff to just three members, all of whom had received limited, six-month contracts which had expired on May 15, 2010.  They had subsequently been integrated into the Lufthansa operation and schedule.

The last Austrian Airlines “red presence,” whether having been created by purely Austrian Airlines or Swissport staff, had occurred on November 15, and the first floor office in Terminal One, hitherto “home” for both the Austrian Airlines and Swissport Management, Passenger Service, Centralized Load Control, Ticket Sales-Reservations, and Baggage Services/Lost and Found Departments, had been relinquished for three desks in the Lufthansa facility, two of which had been Duty Manager stations located on the main level and one of which had been the Key Account Manager position located on the lower level in the Station Operations office.

All things seem to come fully cycle.  The event, effectively ending 21 years of autonomous Austrian Airlines presence, had marked the carrier’s return to its 1938 integration with Lufthansa and its 2000 ground-handling arrangement at JFK.

Changing market conditions had necessitated modified strategies at JFK.  Seeking to align itself with a US domestic carrier in order to obtain vital “feed” to its transatlantic flights it had been unable to achieve on its own, Austrian Airlines had concluded a marketing agreement with Delta Air Lines in 1994, in which it would place its two-letter “OS” code on Delta-operated flights, while Delta itself would reciprocally place its two-letter “DL” code on Austrian’s services.  Two Delta flight attendants, in their own uniforms, had initially also served in the cabins of Austrian’s A-310s to and from Vienna.

Although the concept had slowly reaped financial benefit, the aircraft had ultimately achieved high load factors, carrying both Austrian and Delta passengers from some two dozen US cities through New York to Vienna, often with beyond-travel.

In order to reduce ground-handling costs and attain synergistic, inter-carrier benefits, Austrian Airlines had relocated its operations to Delta Terminal 1A (later redesignated Terminal 2) on July 1, 1994, retaining only nine of its original 21 staff members.  Delta Air Lines, the newly-designated ground-handling carrier, had performed arrivals, lost-and-found, passenger check-in, departure gate, ramp, and baggage room functions, while Austrian itself had continued to act within the ticketing, load control, administration, supervision, and management capacities.

Also in 1994, Austrian had taken delivery of the first of two long-range, quad-engined A-340-200s configured for 36 business class and 227 economy class passengers.  The two aircraft, which would periodically serve New York throughout the next decade, appeared with the following registrations:

1. OE-LAG

2. OE-LAH

From February 1997 to February 1998, Austrian also relocated its check-in counters and operational office to Delta Terminal 3, but otherwise operated within the same marketing framework.

1997 also marked the first time that the transatlantic route to New York had sufficiently matured to support a second departure on selected days during the summer timetable, with the aircraft arriving at 2045 and redeparting at 2205.  Usually operated by aircraft OE-LAC, an A-310 with a reduced-capacity business, but higher-capacity economy class section, the late flight had fostered better connections with the midday bank of departures from Vienna.

Operating a modern, fuel-efficient fleet over an expanding route system and carrying almost 1.5 million passengers in 1986, Austrian once again contemplated intercontinental service, now both to New York in the west and to Tokyo in the east, and toward this end it had converted its previous order for two medium-range Airbus Industrie A-310-200s to the long-range A-310-300 version on June 25, 1986.  Austrian had signed the original memorandum of understanding for the A-310-200s as far back as April 18, 1979, a date which was to prove a full decade before the service would actually get off the ground.  Three factors could be cited as to why the time may have been ripe for a relaunching of this service:

1. In the 15-year interval since the last intercontinental service had been terminated, the home market had considerably grown, a fact demonstrated by the prevailing increases in nonstop US-Vienna service, provided by Pan Am, Royal Jordanian, and Tarom from New York, and by American from Chicago.

2. Its route structure in general equally offered excellent connections to West European, North African, and Middle Eastern destinations.

3. The A-310 had thus enabled long, thin routes such as Lyon-New York with Air France, Frankfurt-Newark with Lufthansa, Istanbul-New York with THY, and New York-Stockholm with Pan Am to have been served.

The decision to reinstate intercontinental service, scheduled for the spring of 1989, had officially been made two years earlier, on June 25, 1987, and would be operated by two Pratt and Whitney-powered A-310-300s which would serve the Vienna-New York and Vienna-Moscow-Tokyo routes, the latter in cooperation with Aeroflot and ANA All-Nippon Airways.  These services had been predicted to have depended upon the connecting passenger for profitability.  On the New York route, for example, a 66-percent, break-even load factor had been needed during the first year of operation, primarily comprised of US-originating, Austria-originating, and connecting passengers.  Both routes had relied on the lucrative, high-yield, frequent business traveler who had been unable to take advantage of the lower, restricted fares.  Austrian Airlines would offer a first class cabin on its A-310-300s for the first time in its history.

The first aircraft, registered OE-LAA “New York,” had been delivered on December 22, 1988, and the second, OE-LAB “Tokyo,” had followed in January.  The aircraft had constituted the airline’s first widebody, twin-aisle type.

Austrian had returned to the transatlantic US market on Easter Sunday, March 26, 1989, when two smoke puffs had signaled the touchdown of the red-white-red liveried widebody twin-jet, configured for 12 first class, 37 business class, and 123 economy class passengers, at JFK amid warm spring weather.  After a brief turn-around, the aircraft, operating as Flight OS 502 and piloted by Captain Braeuer and First Officer Kutzenberger, had been tug-maneuvered away from the gate at 1900 with 121 passengers, who would be served by nine cabin attendants, and took off into the deep purple dusk at a take off weight of 153,603 kilos, 40,300 of which had been fuel required for the Atlantic crossing.  The flight had been 18 years in the making.

Airport, reservations, sales, and marketing staff had subsequently gathered in the Icelandair Saga Lounge used by its business class passengers for a celebratory drink and a group photograph.

The Tokyo route had been opened in the summer and the A-310, to become Austrian’s intercontinental widebody, had served it for more than a decade, operating to multiple US, African, and Far Eastern destinations with four aircraft in a final two-class seat configuration registered as follows:

1. OE-LAA

2. OE-LAB

3. OE-LAC

4. OE-LAD

By the summer of 1989, Austrian Airlines had served 54 cities in 36 countries in the United States, Western Europe, Eastern Europe, North Africa, the Middle East, and Japan with a total route length of 100,358 unduplicated kilometers. These services had been operated by 26 aircraft comprised of the Fokker F.50, the McDonnell-Douglas MD-81/82/83/87, and the Airbus A-310-300 whose average age had then been four years and had been describable as follows:

1. Airbus A-310-300: A long-range, medium-capacity, wide-body, twin-aisle, twin-engine jet airliner--Austrian Airlines’ intercontinental jet.  Austrian Airlines had dubbed it an “intercontinental European.”

2. McDonnell-Douglas MD-81: A medium-range, medium-capacity, narrow-body, single-aisle, twin-engine jet airliner--Austrian Airline’s European, North African, and Middle Eastern workhorse.  Austrian Airlines had described it as a “universal medium-haul airliner and the mainstay of its fleet.”

3. McDonnell-Douglas MD-82: The carrier had ordered the variant “for special-duty scheduled and charter services.”

4. McDonnell-Douglas MD-87: The short-fuselaged, lower-capacity version had been “tailor-made to its needs in capacity and range.”

5. Fokker F.50: A short- and regional-range, low-capacity, narrow-body, single-aisle, twin-engine turboprop airliner operated by Austrian Airline’s Austrian Air Services subsidiary on domestic and select long, thin international routes.  Austrian Airlines had considered it “a propjet specialist in city-hopping.”

In addition to Austrian Air Services, Austrian Airlines owned 80 percent of Austrian Air Transport (AAT), which operated worldwide charter and inclusive tour (IT) flights with both Austrian Airlines and Austrian Air Services aircraft, having carried 506,000 passengers in 1988.  It also maintained a close marketing agreement with Tyrolean Airways which operated services from Innsbruck with 37-passenger de Havilland of Canada DHC-8-100s and 50-passenger DHC-7-100s.

1. Austrian Airlines’ Origins

Austrian Airline’s genesis can be traced back to March 20, 1918, at which time the Austrian Postal Administration had inaugurated daily scheduled mail service from Vienna to Kiew with intermediate stops in Krakow, Lwow, and Proskurow, a route whose average stage length had been 250 kilometers.  When space had permitted, passengers had also been carried.  The highly successful, punctual service was later extended from Proskurow to Odessa and from Vienna to Budapest.  However, a flight prohibition, implemented at the end of World War I, had resulted in its termination.

When the ban had finally been lifted, Austria subsequently reentered the civil aviation market by founding the Oesterreichische Luftverkehrs AG (OELAG) on May 12, 1923 with an initial one million Crown investment financed by Junkers, a German aircraft manufacturer (49 percent), and various Austrian shareholders (51 percent).  Commencing scheduled service from Munich to Vienna some two days later, it had utilized a Junkers F.13, a single-engined, low-wing monoplane which had featured an enclosed cockpit and passenger cabin and had rested on a tail wheel.  OELAG eventually operated several versions of this rugged, but (then) modern design, and increasing demand had soon necessitated larger aircraft, the first of which had been a higher-capacity, tri-engined Junkers G.24 delivered in 1927 and the second of which had been the more advanced G.31, delivered the following year.  Perhaps the ultimate design had been the Junkers Ju.52/3m, a tri-engined, 18-passenger airliner with a gross weight of 24,000 pounds and a cruise speed in excess of 150 mph, which had joined the fleet in 1936.  Most major East and West European flag carriers had also operated the type at this time.

By the following year, OELAG’s route system had radiated to Athens, Belgrade, Berlin, London, Paris, Prague, Rome, and Zurich, in addition to incorporating several Austrian domestic destinations, with much of the service daily.  It eventually became the fourth largest European carrier after Lufthansa, KLM, and Air France, with 975,840 weekly seat-kilometers.  Coincident with OELAG’s growth had been the completion of five Austrian airports--namely, Graz, Innsbruck, Klagenfurt, Salzburg, and Vienna.

When Austria had been absorbed into the Third Reich in 1938, OELAG had been incorporated into Deutsche Luft Hansa (DLH).  Nevertheless, it had flown 120,000 passengers 7.5 million kilometers without fatality during its reign.

2. Initial Growth

When World War II had ended, Austria, now independent, had signed the Peace Treaty with all four occupying powers in 1955, and had once again sought to enter the civil aviation field by forming a flag carrier.  Two such national airlines were actually proposed: Air Austria, formed by the Austrian People’s Party and capitalized by KLM and later Fred Olsen, a Norwegian charter company, and Austrian Airways, formed by the Austrian Socialist Party and financially supported by SAS.  Neither ever flew and the two were eventually combined on September 30, 1957 to form an integrated company with an initial AUS 60 million investment which adopted, Phoenix-like, its pre-war name of Oesterreichische Luftverkehrs AG, but whose English equivalent of “Austrian Airlines” had now been used.  The airline had thus been born.

Ownership had encompassed Austrian private investors, at 42 percent; public enterprises, at 28 percent; SAS, at 15 percent; and Fred Olsen, at 15 percent.  Austrian inaugurated scheduled service on March 31, 1958 after a 20-year suspension with four leased Vickers V.779 Viscounts, a medium-capacity, four-engined turboprop airliner designed in Great Britain and initially deployed over the Vienna-Zurich-London route.  Austrian had finally returned to the sky.

Growth proceeded rapidly and, in 1960, it took delivery of the first of four larger-capacity, stretched Vickers V.837 Viscounts, which it inaugurated into service on May 23, and the following year it received the Vickers V.845 Viscount for slightly lower-capacity routes.  Both British turboprops provided reliable, economical service, the V.837 not being retired until 1971.  The Douglas DC-3, the best-selling civil airliner of all time, had also been acquired at this time and had enabled Austrian to inaugurate domestic services on May 1, 1963, a route which would later be served by Austrian Air Services.  This aircraft was replaced by the more advanced, larger-capacity, turboprop-powered Hawker Siddeley HS.748-2 in 1966, another British design.

Austrian Airlines entered the jet age on February 20, 1963 when it inaugurated the first of five Sud-Aviation SE.210-VIR Caravelle twin-jets into service and set the stage for its eventual strategy of operating short- to medium-range, low- to medium-capacity, t-tailed twin-jets on a predominantly European (and later North African and Middle Eastern) route structure.  Designed in France, the Caravelle was quiet, cruised above the weather, and reduced flying times between European capitals, and had, in fact, been the first design to permit economical, short-range, pure-jet service.