Breaking: British Airways set to cut up to 12,000 employees amid coronavirus restructuring
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
British Airways is set to cut as many as 12,000 employees in light of the coronavirus crisis and the ongoing effect it’s had on the aviation industry. That’s a quarter of the workforce.
On Tuesday, British Airways CEO Alex Cruz detailed in a letter to employees that the airline’s parent company International Airlines Group (IAG) would undergo a restructuring and redundancy program.
“We are taking every possible action to conserve cash, which will help us to weather the storm in the short-term,” Cruz wrote in the letter to employees. “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.”
Cruz noted the bleak outlook for the aviation industry in the near-term future, and that British Airways isn’t looking to the U.K. government for a bailout.
“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,” Cruz said. “ We have informed the Government and the Trade Unions of our proposals to consult over a number of changes, including possible reductions in headcount.”
The IAG layoffs and restructuring will mostly affect BA employees and could result “in the redundancy of up to 12,000 of them.”
The letter from Cruz to BA employees followed the release of IAG’s preliminary first-quarter results. In it, the company detailed that total revenue dropped by 13% to $5.7 billion compared to $6.6 billion in the year prior.
Since the start of the downturn in travel and subsequent lockdown period, British Airways had already announced that it had furloughed more than 22,000 employees.
According to IATA, full-year passenger traffic is expected to fall by 48%, while passenger revenues are expected to plummet by 55% compared to 2019.
British Airways is operating just a selection of flights. The airline’s home airport London Heathrow has shut down one of its runways and closed two terminals in light of the news that passenger traffic through the airport was expected to be 90% down for the month of April.
IAG will unveil its full first-quarter results on May 7.
British Airline Pilots Association (BALPA) has not commented on Tuesday’s announcement.
Featured photo by ADRIAN DENNIS/AFP/Getty Images.
Sign-up Successful!
Welcome to The Points Guy!
WELCOME OFFER: 80,000 Points
TPG'S BONUS VALUATION*: $1,650
CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners
*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.
- Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
- Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
- With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
- Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.
Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.