Pilot strike grounds half of long-haul flights at Lufthansa

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FRANKFURT (Reuters) - Pilots at Lufthansa started their second strike this week on Thursday, grounding about half of scheduled long-haul flights at the German flagship carrier, in a drawn-out dispute over an early retirement scheme.

Pilots' union Vereinigung Cockpit (VC), representing about 5,400 Lufthansa pilots, is fighting to retain with no changes a scheme allowing pilots to retire at age 55 and still receive up to 60 percent of their pay before regular pension payments start at 65.

Lufthansa has said it would not accept a demand that new pilots, as well as those already with the company, should be able to retire at 55.

It offered VC mediation on Wednesday in hopes of resolving the dispute in time for the busy Christmas holiday season.

The Germany-wide strike, the tenth this year, started at 02:00 GMT on Thursday (9 p.m. EST on Wednesday) and is to last until 22:59 GMT (5.59 p.m. EST). It forced Lufthansa to cancel 37 long-haul flights and six cargo flights.

Domestic and European routes, as well as flights of Lufthansa's units like Germanwings, Austrian Airlines and SWISS are not affected.

Industrial action in Lufthansa's dispute with the pilots has already wiped 160 million euros ($200 million) off the airline's operating profit this year, not including this week's two walkouts.

Lufthansa's board on Wednesday approved plans to expand its low-cost operations as it battles to compete with budget carriers such as Ryanair  and easyJet  and Gulf operators including Emirates, Etihad and Qatar.

(Reporting by Maria Sheahan; Editing by Muralikumar Anantharaman)