Indonesia’s Lion Air Group will put around 8,000 staff — or about 25-35% of its 23,000 employees — on furlough, as its operations have taken a severe hit amid the coronavirus pandemic.
A 31 July statement from the low-cost carrier group says furlough will be effective immediately “until further notice”. It did not state which divisions or roles will be furloughed.
The group, comprising Lion Air, full-service unit Batik Air and regional carrier Wings Air, states that the move was taken to “maintain a sustainable business, streamline company operations, reduce costs and restructure the company”.
It notes that operations have been significantly impacted by the coronavirus pandemic, and that recovery prospects remain uncertain.
The group is operating at only 10-15% pre-pandemic capacity, or about 1,400 flights a day, it adds.
Indonesia is experiencing its worst-ever outbreak, with more than 37,000 new infections reported on 31 July. The country extended domestic travel restrictions through early August, in an attempt to limit the spread of the coronavirus.
Until now, Lion Air Group has largely remained coy about the pandemic’s impact. Compatriot Indonesia AirAsia has suspended all flights until 6 August, while flag carrier Garuda Indonesia has cut capacity across its domestic network. Both carriers were also deep in the red financially, as travel restrictions heavily impacted passenger revenue.
Cirium fleets data indicates that Lion Air has an in-service fleet of 70 Boeing 737s, with another 69 jets in storage. Batik Air has 45 in-service aircraft, most of them Airbus A320s, with 24 in storage. Wings Air has 53 ATR 42 and 72s in service, with 13 stored.