“The scale of this challenge requires substantial change so we are in a competitive and resilient position, not just to address the immediate Covid-19 pandemic, but also to withstand any longer-term reductions in customer demand, economic shocks or other events that could affect us. However challenging this is, the longer we delay difficult decisions, the fewer options will be open to us.”
He concluded: “This has been a difficult message to write and one I never thought I would need to send. I know how tight-knit the BA family is, and how concerned you will be, not just for yourself but for your colleagues, too. We must act decisively now to ensure that British Airways has a strong future.”
The redundancies comes a day after the airline industry warned of immeasurable damage if ministers press ahead with plans to quarantine travellers for 14 days after they arrive at British airports.
It is feared that harsh new measures to confine passengers at home or a hotel for a fortnight will wreck international travel and hammer consumer confidence at a time when many carriers are already close to collapse.
https://www.telegraph.co.uk/business/2020/04/28/british-airways-lays-12000-staff/
.
The letter from Alex Cruz:
PREPARING FOR A DIFFERENT FUTURE
April 28, 2020
Letter to colleagues from Alex Cruz, Chairman and CEO at British Airways
Yesterday, British Airways flew just a handful of aircraft out of Heathrow. On a normal day we would fly more than 300. What we are facing as an airline, like so many other businesses up and down the country, is that there is no ‘normal’ any longer.
The global aviation body, IATA, has said that the industry has never seen a downturn this deep before, and that full year industry passenger revenues could plummet 55% compared to 2019, while traffic falls 48%. Many airlines have grounded all of their planes. Sadly, we will see some airlines go out of business with the resulting job losses.
Our very limited flying schedule means that revenues are not coming into our business. We are taking every possible action to conserve cash, which will help us to weather the storm in the short-term. We are working closely with partners and suppliers to discuss repayment terms; we are re-negotiating contracts where possible; and we are considering all the options for our current and future aircraft fleet. All of these actions alone are not enough.
In the last few weeks, the outlook for the aviation industry has worsened further and we must take action now. We are a strong, well-managed business that has faced into, and overcome, many crises in our hundred-year history. We must overcome this crisis ourselves, too.
There is no Government bailout standing by for BA and we cannot expect the taxpayer to offset salaries indefinitely. Any money we borrow now will only be short-term and will not address the longer-term challenges we will face.
We do not know when countries will reopen their borders or when the lockdowns will lift, and so we have to reimagine and reshape our airline and create a new future for our people, our customers and the destinations we serve. We have informed the Government and the Trade Unions of our proposals to consult over a number of changes, including possible reductions in headcount. We will begin a period of consultation, during which we will work with the Trade Unions to protect as many jobs as possible. Your views matter and we will listen to all practical proposals.
The scale of this challenge requires substantial change so we are in a competitive and resilient position, not just to address the immediate Covid-19 pandemic, but also to withstand any longer-term reductions in customer demand, economic shocks or other events that could affect us. However challenging this is, the longer we delay difficult decisions, the fewer options will be open to us.
I want to pay tribute to the thousands of British Airways colleagues who are playing a vital role in the global response to the Covid-19 crisis. Whether you are supporting our repatriation flights or the transport of essential cargo; or one of the hundreds of colleagues volunteering with organisations such as the NHS, you have my sincere respect and thanks.
This has been a difficult message to write and one I never thought I would need to send. I know how tight-knit the BA family is, and how concerned you will be, not just for yourself but for your colleagues, too. We must act decisively now to ensure that British Airways has a strong future and continues connecting Britain with the world, and the world with Britain.
Thank you.
Alex
https://mediacentre.britishairways.com/pressrelease/details/86/News-1/12272?ref=Home
.
British Airways will make up to 12,000 workers redundant as owners IAG say it will take airline years to recover from coronavirus crisis
Madrid-based IAG says portion of BA’s 45,000 staff now face redundancy
British Airways has grounded most of its flights, except a handful from Heathrow
‘We are taking every possible action to conserve cash’ – BA CEO Alex Cruz
By LUKE MAY – FOR MAILONLINE
28 April 2020
Thousands of British Airways workers look set to lose their jobs as its owners IAG announce redundancies on Tuesday afternoon.
Airline companies have been struggling to run as the coronavirus lockdown grounds planes around the world. BA had already started struggling after it furloughed more than half of its 45,000 workers.
In a statement, IAG said: ‘In light of the impact of Covid-19 on current operations and the expectation that the recovery of passenger demand to 2019 levels will take several years, British Airways is formally notifying its trade unions about a proposed restructuring and redundancy programme.
‘The proposals remain subject to consultation but it is likely that they will affect most of British Airways’ employees and may result in the redundancy of up to 12,000 of them.
‘As previously announced, British Airways has availed itself of the UK’s Covid-19 job retention scheme and furloughed 22,626 employees in April.’
Passenger numbers are expected to halve compared to 2019, with the likes of Flybe already going into administration before full lockdown measures were in place in Britain.
In a statement, BA chief executive Alex Cruz said: ‘Our very limited flying schedule means that revenues are not coming into our business. We are taking every possible action to conserve cash, which will help us to weather the storm in the short-term.’
Mr Cruz added the company was working with partners and supplies to re-negotiate contracts and and ‘discuss repayment terms’.
‘All of these actions alone are not enough,’ he told workers.
His letter continued: ‘There is no Government bailout standing by for BA and we cannot expect the taxpayer to offset salaries indefinitely. Any money we borrow now will only be short-term and will not address the longer-term challenges we will face.
‘We do not know when countries will reopen their borders or when the lockdowns will lift, and so we have to reimagine and reshape our airline and create a new future for our people, our customers and the destinations we serve.
‘We have informed the Government and the Trade Unions of our proposals to consult over a number of changes, including possible reductions in headcount.’
According to analysis by US-based Dollar Flight Club, we can expect lower airfare prices in the short term, before prices rise dramatically by 2025.
Through to 2021, the flight deals service found there would be a 35 per cent decrease in prices on average, as airlines desperately attempt to draw customers back in.
But over the next four years, prices would then rise by over a quarter above pre-crisis levels as demand outstrips a significantly reduced supply.
The data indicates more severe drops and subsequent price hikes than were experienced either during 9/11 or from the financial crash.
‘Passengers in smaller or short-haul markets can expect significant cuts in scheduled air service as airlines downsize operations,’ read the report.
‘This will make it significantly more expensive and harder for these passengers to travel. In these markets, we can expect train and bus travel to see significant growth.’
The club found that over the next year, customers could get a roundtrip from Los Angeles to London for $329, or a roundtrip from New York to Amsterdam for $278.
News that thousands of people will lose their jobs comes weeks after the airline company’s Spanish owners axed a controversial £300million payout to shareholders earlier this month.
Madrid-based International Airlines Group proposed a dividend of around 17p per share in February, when the ravages of the killer virus on society and the global economy were already apparent.
But chief financial officer Stephen Gunning said the cash would instead be used to keep the company going through the virus crisis.
One former manager in BA’s finance team told MailOnline earlier in April: ‘Don’t blame the virus. This company has been mismanaged for years. IAG have simply sucked the life out of it’.
….and there is more about other airlines ….
https://www.dailymail.co.uk/news/article-8266013/British-Airways-make-12-000-workers-redundant-says-owners-IAG.html
.
