This archive report was first published on 18 May 2020.
As the Coronavirus pandemic continues to wreak havoc on the global economy, airlines are facing unprecedented challenges. In a bid to weather the crisis, major carriers are implementing drastic measures, including massive job cuts.
Emirates, one of the world's largest airlines, plans to decommission 40% of its Airbus fleets and lay off almost a third of its crew and pilots. The airline's President, Tim Clark, has warned that the industry will emerge 20-30% smaller after the pandemic.
Similarly, Air Canada is planning to lay off nearly 20,000 employees, or over half of its workforce. The airline believes that these cuts are necessary to rebuild after the crisis. According to a memo obtained by CBC, approximately 50 to 60 percent of the company's 38,000 employees will be laid off, effective June 7.
The job cuts come as airlines make massive losses due to the pandemic. Government restrictions on travel and people's skepticism about avoiding travel have severely impacted the industry. As a result, carriers like Air Canada are flying at just 5% of their pre-pandemic capacity, hoping to reach 25% as travel restrictions ease.
Emirates Chief Executive Sheikh Ahmed bin Saeed Al Maktoum has warned that the epidemic will have huge impacts on the financial performance of airlines, calling for aggressive cost management initiatives. In Emirates, the cost-cutting measures will involve letting go of 7,500 staff members, with the criteria for job cuts depending on age, performance, and sickness.
It may take up to 18 months for the airline industry to return to normal, according to Emirates CEO. However, the airline is opening up limited services starting on May 21.
