Caribbean Airlines plans to shed 25% of its staff or 450 employees and store aircraft as it pursues a restructuring strategy in the wake of the devastating coronavirus crisis.
The airline, headquartered in Port of Spain, Trinidad and Tobago, says on 21 June that it “will need to adjust its operations to cater for a reduced scale of demand after the opening of the borders”.
”Put simply, passenger demand in the short to medium term is not going to recover sufficiently to support the existing company structure,” the airline says.
“As a consequence, Caribbean Airlines is required to take further steps to ensure it has a sustainable business model for 2021 and beyond. These steps include major cost reductions in all areas of the airline’s operations, specifically its human resource complement, its fleet and other assets, and its route network.”
According to Cirium fleets data, the airline currently has six ATR 72-600 turboprops in operation, as well as seven Boeing 737-800 aircraft. It has five Boeing 73 Max on order. The carrier does not say how many aircraft it will take out of its operating fleet as part of the restructuring strategy.
The news comes on the same day that Caribbean reported first quarter 2021 results. The carrier posted a TT$172.7 million ($25.7 million) loss for the period, and a 75% decline in revenue, compared to the same three months in 2020.
“The losses follow a similar downturn in 2020, which saw an operating loss of TT$738 million compared to operating profits for 2018 and 2019,” the airline says. “Since the beginning of the Covid-19 pandemic and the suspension of operations at its base in Trinidad and Tobago, the airline has seen passenger numbers plummet, and flight numbers reduced to less than 10% of normal operations.”
That said, Caribbean says it was able to reduce expenses by 52% compared to the same period in 2020. The airline was kept afloat during the global pandemic by a government guaranteed loan and a cash infusion totalling $100 million.