United Airlines now planning for bigger pilot layoffs

United Airlines warns of even deeper layoffs than previously discussed because of weakening demand due to the latest coronavirus spike
United Airlines warns of even deeper layoffs than previously discussed because of weakening demand due to the latest coronavirus spike (AFP Photo/JUSTIN SULLIVAN)
  • United Airlines warns of even deeper layoffs than previously discussed because of weakening demand due to the latest coronavirus spike

New York (AFP) – United Airlines is now planning for even deeper furloughs of pilots following the latest weakening of air travel demand due to the coronavirus, a company official said Thursday.

The big US carrier currently is planning for 3,900 pilots to be furloughed, up from 2,250 expected in early July before the latest spike in US coronavirus cases that has led to another deterioration in customer interest.

“Because COVID-19 cases continue, and demand improvement remains very slow, we may need to furlough more pilots in 2020, and in 2021, than originally planned,” Bryan Quigley, senior vice president for flight operations, said in a memo to staff.

Quigley said total revenues for the airline are down about 85 percent. The company expects to end the third quarter with a daily cash burn of $25 million per day.

“This is simply not sustainable for us,” Quigley said.

United has previously said it does not expect airline travel demand to get above 50 percent of pre-coronavirus levels until a vaccine is found and widely available. The company’s chief executive Scott Kirby said last week that he is planning for this outcome until late 2021.

Unions for airline workers are lobbying for additional funds from Congress to support jobs in the industry.

Quigley pointed to those efforts, adding that the “only other way to mitigate furloughs is through a negotiated agreement with our unions to reduce the costs until we see a return of demand to our business.”

Link: https://www.yahoo.com/news/united-airlines-now-planning-bigger-pilot-layoffs-182432597.html

Spirit Airlines Prepping to Furlough Up to 30% of Its Workforce

Spirit Airlines is prepping to furlough as much as 30% of its workforce due to the coronavirus pandemic and its economic impact on the airline industry.

Spirit Airlines (SAVE) – Get Report is prepping to furlough as much as 30% of its workforce in October, making it the first low-cost U.S. carrier to implement job cuts due to the coronavirus pandemic and its economic impact on the airline industry.

According to an internal memo seen by Reuters, the Miramar, Fla.-based carrier will be informing unions of its plans as early as this Friday.

“It’s now clear that the demand increase we saw in June was an outlier, and the downward trend will continue,” CEO Ted Christie said in the memo, adding that the airline’s expected daily cash burn of more than $100 million per month in the coming months “is not sustainable.”

“The health crisis, loss of demand, and corresponding economic impact caused by Covid-19 is unprecedented,” Christie said.

Spirit was among the U.S. airlines that received government bailout funds to keep workers employed through September amid the sharp downturn in air travel demand due to virus-related lockdowns and travel bans.

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However, the dramatic drop-off in flight demand amid travel restrictions to combat the spread of Covid-19 has left all airlines including Spirit operating at still-limited capacity.

With the stimulus package set to expire in September, several carriers including Spirit are now warning of furloughs, given that demand still has not recovered.

Indeed, American Airlines (AAL) – Get Report and United Airlines (UAL) – Get Report have warned that more than 60,000 jobs are potentially at risk, though others airlines including Southwest Airlines (LUV) – Get Report and JetBlue Airways (JBLU) – Get Report have so far said they can avoid furloughs.

Link: https://www.thestreet.com/investing/spirit-airlines-save-stock-furlough-workforce?puc=yahoo&cm_ven=YAHOO

United gives employees longer to decide on voluntary furloughs

United gives employees longer to decide on voluntary furloughs
FILE PHOTO: A United Airlines passenger jet takes off with New York City as a backdrop

(Reuters) – United Airlines on Wednesday extended a deadline for most employees to decide whether to take voluntary furlough deals to Aug. 10, as it waits to see if the U.S. Congress extends an airline bailout in the first week of August.

United announced the extension in a memo to employees seen by Reuters, adding that it was working with unions, which are lobbying U.S. lawmakers for an extension of the bailout that would prevent voluntary furloughs and delay impact on employees until early 2021.

United confirmed the memo and declined to comment further. Most employees had previously faced a Thursday deadline to decide whether to apply to leave.

“While nothing is certain, our union partners have built a strong campaign to advocate for an extension” of the payroll assistance program, the memo said. “We have worked closely with them to support those efforts.” But the letter added that United is “not counting on Congress passing an extension.”

Chicago-based United said last week more than 6,000 employees had opted for exit packages. But after sending 36,000 notices of potential furloughs this month, that relatively low take-up suggests United might have to furlough a significant number of workers.

On Monday, a majority of the U.S. House of Representatives signed a letter calling for a six-month extension of the $32 billion aviation industry payroll aid program, arguing it is crucial to keeping hundreds of thousands of aviation workers employed.

The payroll program is set to expire Sept. 30.

Congress awarded $25 billion in payroll assistance to U.S. passenger airlines in March, along with $4 billion for cargo carriers and $3 billion for airport contractors. Most bailout funds do not have to be paid back.

Between American Airlines and United, more than 60,000 frontline workers have received warnings that their jobs are on the line on Oct. 1.

Separately, American has extended a deadline for frontline workers to accept voluntary exit packages to Aug. 5 from July 31, according to a memo seen by Reuters.

Link: https://www.yahoo.com/news/united-gives-employees-longer-decide-010200188.html