Aer Lingus is not ruling out compulsory job cuts and closing its bases at Cork and Shannon aiports as it continues to grapple with Government travel restrictions.
The news comes as it emerged that the Irish airline lost €316 million during the first six months of the year as Covid-19 travel bans hit Europe and the US.
Sean Doyle, Aer Lingus chief executive told staff on Friday that jobs would be cut on a “compulsory basis if necessary” but stressed that redundancies would be voluntary if possbile.
The airline has already signalled that it could have to cut up to 500 jobs while Mr Doyle confirmed this week that it was in talks with unions.
He told workers there was no immediate sign on any meaningful restart of flights from Cork and Shannon airports.
“As such we are reviewing the scale of our flying programme from these airports and the ongoing viability of our regional bases there,” Mr Doyle warned.
He told staff that the company had been unable to make progress with unions representing cabin crew and ground staff.
At the same time, he noted that the Government had failed to act on the recommendations of its own Aviation Recovery Task Force, which include a call to ease travel restrictions.
“Essentially there has been a failure in Ireland amongst a number of key stakeholders to understand or appreciate the scale and depth of this crisis in the aviation sector,” Mr Doyle told workers.
Aer Lingus issued a statement confirming Mr Doyle’s remarks to staff on job cuts and operations and Cork and Shannon airports.
Figures published earlier on Friday show the carrier’s revenues slumped by almost two thirds to €377 million during the first half of the year from €968 million during the same period last year, according to its owner, International Consolidate Airlines Group (IAG).
Aer Lingus’s operations lost €189 million, while an exceptional loss of €189 million brought the total deficit for the first half to €316 million. The airline’s profit for the same period last year was €78 million.
Passenger revenues earned by the Irish airline tumbled 60 per cent to €315 million during the first half from €936 million in the in opening six months of 2019.
However, cargo revenues more than doubled to €60 million in the period from €26 million during the comparable six months of 2019.
The airline flew deliveries of personal protective equipment from China to the Republic during the most severe weeks of the coronavirus lockdown.
IAG, which also owns British Airways and Spanish airlines, Iberia and Veuling, plans to raise up to €2.75 billion, subject to shareholders’ approval at a meeting in September, group chief executive Willie Walsh confirmed.
IAG lost €4.2 billion during the first half. That included once-off losses of €2.1 billion.The airline group made a €1 billion profit in the first six months of 2019.
“All IAG airlines made substantial losses,” Mr Walsh said. He added that passenger numbers collapsed by 98.4 per cent as a result of government travel restrictions in the second quarter of the year.
“We have seen evidence that demand recovers when government restrictions are lifted,” Mr Walsh noted.
He said IAG believed it would be 2023 at least before passenger demand recovered to 2019 levels.
The carrier last month confirmed that it could seek up to 500 redundancies, more than one in 10 of its 4,500 workers.
Also on Friday, IAG announced that independent director, Javier Ferrán, will succeed Antonio Vázquez in January 2021.
Mr Vázquez will have served nine years in the chair in January, the maximum recommended by corporate governance codes.