DAVID LEARMOUNT / LONDON
European airlines have continued to slash jobs and services following the collapse in traffic following the events of 11 September. Most affected are those highly exposed on the North Atlantic routes, such as Aer Lingus, but Iberia - only 4% of whose traffic is North American - is trimming anyway for what it predicts will be "a deep crisis, but not very long".
On 10 October, Irish minister for public enterprise Mary O'Rourke told parliament Aer Lingus was losing I£2 million ($2.3 million) a day. "Without action the company will run out of cash early next year, she said. "The chairman believes there is a need for a reduction of 2,500 people in the 6,500 workforce. That means taking action to ensure that we will have an airline, fundamentally restructured, which will have a basis from which to grow when markets improve."
Aer Lingus, which normally gets 60% of its profits from transatlantic routes, has appealed to the government to meet the cost of redundancies.
In addition to reductions already announced other key developments have been:
Alitalia is discontinuing or reducing services on 34 routes. The cancellations include 19 to European (mainly regional) destinations, 11 domestic services, and flights from Milan to Beijing and Hong Kong; Milan to Los Angeles; and from Rome to Rio de Janeiro. It also intends to cut the workforce by 2,500 as soon as possible. Decisions on the fleet modernisation plan have been postponed while the carrier pushes for a L750 billion ($350 million) government injection, the final tranche of a sum cleared by the European Commission in 1997. Austrian Airlines is reducing the workforce by 800. The board and middle management of Austrian, Lauda Air and Tyrolean Airways are taking voluntary pay cuts of 15%. British Airways has opened talks with its five main unions about saving £37 million ($53 million) through withholding a week's bonus payment and incremental (seniority) increases. Meanwhile, it says that the planned merger of its two regional subsidiaries British Airways Regional and CityFlyer Express will result in a combined workforce reduction of 200, creating Europe's second largest regional airline. Greek Government consultants are urging the workforces of near-bankrupt Olympic Airways and Axon Airlines to start negotiations for a total restructuring, and they are pressing Athens Spata airport to cut landing fees by 20%. SAS is reducing its workforce by 800-1,100, and is cutting overall capacity by 12% with the biggest cuts on intercontinental routes. Fleet cuts total 16 aircraft, with three widebodies, 10 narrowbodies and three commuter aircraft grounded. Routes cut include Copenhagen to: Delhi; London Stansted; Barcelona; Tel Aviv; and St Petersburg.Source: Flight International
