German airline Lufthansa says it has cancelled about half of its flights after pilots went on strike in an ongoing dispute over retirement benefits.

The airline, Germany's largest, said Monday that 1,350 of its 2,800 flights scheduled through the strike's end Tuesday at midnight have been cancelled, affecting 150,000 passengers. The strike was primarily focused on Lufthansa's inner-Europe flights on Monday but was to be extended to long-haul flights Tuesday.

Lufthansa says the other airlines in its group — Germanwings, Swiss, Austrian Airlines, Brussels Airlines and Air Dolomiti — are not affected.

The strike follows failed talks with the Vereinigung Cockpit union, which is demanding Lufthansa keep paying a transition payment for those wanting to retire early. The airline wants to cut those payments, citing increasingly tough competition.