Categories
Transport

Airline Announces Major Cuts to Staff as Demand Dwindles

The second-largest airline in Canada announced Tuesday over half of its employees would be leaving the company as the coronavirus outbreak continues to cause a decline in demand.

According to The Associated Press, WestJet CEO Ed Sims revealed around 6,900 of the 14,000 employees at the airline have either retired early, resigned or were laid off. The carrier announced 90 percent of departing workers did so voluntarily.

Sims said the decision was made to cut costs and stabilize the airline as it temporarily suspended all international flights for 30 days and dramatically cut back on domestic service.

“It is through these WestJetters’ sacrifices that we can preserve a core of people who will remain employed to prepare for the moment when the situation stabilizes, and we can look to rise again,” Sims said in a statement.

WestJet asked employees last week to decide how they wanted to help the carrier survive the economic hardships caused by the coronavirus, including unpaid leave of absence, early retirement, voluntary resignation, reduced workweek or reduced pay.

Sims went on to say the airline’s executive team took a 50 percent pay cut and vice presidents and directors took a 25 percent pay cut. The carrier continues to work with the federal government about possible support.

Canadian airline Air Canada also announced its pilot union said up to 600 of its members will go on unpaid leave in the coming months due to the pandemic, while U.S. carriers are drafting plans to temporarily stop flying entirely.

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Categories
Cruises

Sabre implements pay cuts other cost cutting moves coronavirus

In response to the Covid-19 coronavirus outbreak, Sabre has announced cost-cutting measures to the tune of $200 million, including temporary compensation reductions for its salaried U.S. workforce and a 25% reduction for president and CEO Sean Menke.

According to tax documents, Menke’s base salary as of April 2019 was $975,000.

Sabre did not specify the amount of reductions other employees would see. It will also “work with international employees on a country-by-country basis,” the company said in a statement.

Additionally, the cash retainer for members of Sabre’s board of directors will be reduced. Its 401(k) match program will be suspended for participating U.S. employees. Globally, the company is offering voluntary unpaid time off, severance and early retirement. The company is also reducing vendor costs, third-party contracting and “other discretionary spending.”

“This is an unprecedented time,” Menke said in a statement. “The global travel industry is facing challenges beyond what has been experienced before. We believe Sabre is well positioned to navigate this challenging environment. We are fortunate that significant aspects of our cost structure are variable and are taking steps to help align our other costs with the current demand environment.

Sabre also expects a decline in Sabre Travel Network incentive expenses in proportion to the global travel decline Covid-19 is causing, and a reduction in its $250 million technology hosting costs.

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Categories
Transport

Delta Air Lines Cuts Service By 70 Percent, Grounds Planes

Delta Air Lines announced Wednesday the carrier would be forced to cut more flights and park at least half of its fleet of airplanes due to the drop in demand caused by the coronavirus outbreak.

According to The Atlanta Journal-Constitution, Delta CEO Ed Bastian revealed the airline would cut passenger capacity by 70 percent across its system—including an 80-percent reduction on international service—until the demand for the routes begins to rebound.

Bastian said revenue is expected to drop by nearly $2 billion in March when compared to 2019 and the financial forecast for April is even worse. As a result, 10,000 employees will take unpaid leave, the carrier is deferring new aircraft deliveries and executives are working on $4 billion in new credit.

On Wednesday, Bastian and CEOs from the top airlines in the United States took part in a conference call with President Donald Trump to talk about the possibility of receiving federal aid. The White House is considering around $50 billion in secured loans for U.S. carriers.

Delta isn’t the only airline feeling the burden of the coronavirus outbreak, as United Airlines announced Tuesday it would reduce its number of flights scheduled for next month by a total of 60 percent, including a 42-percent drop across the U.S. and Canada and an 85-percent decrease in international flights.

American Airlines also revealed it would cut 75 percent of its international capacity through May 6 to combat the loss of revenue from decreased customer demand.

Despite the severe impact of the coronavirus on the aviation industry, several of the country’s top airlines have started offering flight deals for passengers to book for travel after bans and restrictions are lifted.

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