BERLIN, July 29, 2008 (AFP) - Passengers felt the impact Tuesday as German flag carrier Lufthansa cancelled 70 flights on the second day of an open-ended strike, while Berlin warned of the potential economic blow of the walkout.

The start of the strike by ground personnel Monday caused few disruptions in the heavy summer travel season but by Tuesday, travellers scrambled to find alternatives to reach their destinations.

Service on Germany's top airline was cancelled on 70 domestic and European routes, a Lufthansa spokesman said, but said they represented just 'three percent of all flights' scheduled by the carrier.

Most of the cities affected had more than one connection per day, the spokesman said, and long-haul flights were operating normally.

'Customers are kindly requested to check on their flight status prior to their trip,' read a message on the company's website.

The German government's chief tourism official, Ernst Hinsken, said prolonged industrial action could strike a blow to Europe's biggest economy, which is already feeling the effects of the strong euro, high fuel prices and the global credit crunch.

'Strikes such as those at Lufthansa could pose a serious risk to the German economy,' he told the daily Passauer Neue Presse.

Hinsken said the country's trade unions could have no interest in hobbling Lufthansa with walkouts that would cost it millions of euros.

'I am asking them to see reason,' he said.

Service sector union Verdi has estimated that the strike would cost Lufthansa five million euros (7.9 million dollars) a day.

Verdi wants a 9.8 percent pay hike over a year for around 50,000 workers, while Lufthansa has offered 6.7 percent over 21 months.

The union dismissed Lufthansa's call for an immediate return to the negotiating table.

'Those are just hollow words,' Verdi spokesman Harald Reutter said. 'Human resources chief (Stefan) Lauer has not been in touch with us with a better offer. We are striking for a better deal and not for an invitation to coffee.'

Verdi said it was doing what it could to avoid inconveniencing travellers while it ratcheted up the pressure on Lufthansa.

'The goal of the strike is not to hinder passengers but to increase the cost to the company,' Verdi's chief negotiator Erhard Ott said Monday, noting that ordering catering from other firms or docking planes in other hangars was 'very pricey'.

He added that Lufthansa had already seen a decline in reservations in recent weeks as wary passengers booked with other carriers.

Reutter noted that the striking maintenance staff also serviced planes from other airlines and said that US and Canadian carriers were sending their own mechanics on transatlantic flights and would likely bill Lufthansa.

As the biggest aircraft maintenance service provider in Germany, Lufthansa would find it difficult to find replacements to fill in, industry experts said.