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October 7, 2009    

Aer Lingus to axe almost 700 jobs

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by Kay Murchie

Irish airline Aer Lingus, which like many others is struggling amid the global recession, has today announced plans to reduce headcount by 676 in a bid to save €97 million (£90 million) over the next two years.

Furthermore, the airline is also calling on staff earning more than €35,000 (£32,400) a year to take a pay cut in an effort to save the airline from collapse.

The company has already axed 100 staff and has today refused to rule out compulsory redundancies and further job losses in the future.

The airline, like many others is struggling to stay afloat during the global economic downturn which has led to a slump in demand. Many airlines have been forced out of business as fewer people are travelling by air. Furthermore, higher fuel costs has had a devastating impact on the industry.

Christopher Mueller, Chief Executive Officer at Aer Lingus, said: “The outlook in each of our current core markets is poor and, in line with the macroeconomic outlook, we do not expect any near-term recovery.

“Against this backdrop, Aer Lingus cannot continue with an operating base, which is structurally uncompetitive when compared to that of its closest peers,” he added.

The news comes just a day after British Airways (BA) announced it is continuing to slash costs by wielding the axe on 1,700 cabin crew members and a two-year pay freeze.

The airline admitted during the summer it was fighting to survive and has since been looking at ways to cut costs.

As devastation sweeps across the industry, it was announced last month that Japan Airlines had asked the Government for public funds to strengthen its capital base and save it from collapse.

The news came just a week after the loss-making carrier announced plans to cut its operating schedule and reduce headcount by almost 7,000.

In the same week, it was announced that Russian airline Aeroflot would reduce headcount by 13% - around 2,000 jobs in the next six months.

The airline, which is 51% government owned, said profits had dived amid higher fuel prices and losses at its cargo operations, which declared bankruptcy in June.

In a further blow to the industry, the International Air Transport Association recently raised its forecast for losses across the whole industry to £6.9 billion ($11 billion).

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1 Comment »

  1. I see three options. The first one, Aer Lingus manage its reorganization. The second one is that Aer Lingus will be save by another established airline (I don’t think so) and the third one is that Ryanair take control of Aer Lingus. Then he’ll transpose Ryanair’s model to Aer Lingus. Then this is the end of Aer Lingus’ worker union and descends work condition.

    Comment by claire — October 9, 2009 @ 2:24 pm

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