Virgin Atlantic plans to cut more jobs as chief says the airline is still struggling to survive.
However, on Friday the airline announced that it plans to cut more than 1,000 jobs. As it has successfully utilized its £1.2 billion probate sector rescue deal.
“Anyone operating in aviation and tourism around the world is still fighting for survival.” Mr. Shai Weiss, chief executive said as he urged the UK and US to work together to reopen the transatlantic market for passenger flights.
However, the airline will cut 1,150 jobs across all its business. These job cuts are other than the previous 3,150 job cuts that the airline announced in May.
“Further reducing the number of people we employ is heartbreaking but essential,” Mr. Weiss said. Adding that he did not expect to make further significant cuts.
Survival in the Crisis
The airline has never seen a crisis like this before however, it is the biggest crisis since its creation in 1984.
The airline has long-traded on a glamorous image including stylish lounges and bars in its premium cabins. And brands itself as a disrupter shaking up a tired industry.
Due to limited long haul flights, the airline is facing a collapse in international travel this year. As there are very few passengers that we’re able to fly the transatlantic market. This contributes 70 percent of Virgin Atlantic’s network and is down due to immigration restrictions.
Mr. Weiss called for “rapid and immediate action” from the UK government to introduce testing on arrival and departure to allow an expansion of safe international travel.
The Unite union said the latest round of job losses was “another serious blow to the UK’s aviation industry”.
The Pandemic Effect
Aviation has been one of the worst-hit sectors during the pandemic. The demand for international flights was down by 92 percent as compared with the previous year in July.
However, airlines are expecting that demand will not return to pre-pandemic levels until 2024. And as long-haul routes are the main support for the airline is at a halt due to the immigration and quarantine regulations and restrictions.
To survive in this crisis airlines are cutting down routes, jobs, and other costs in response. Virgin Atlantic is temporarily not operating from its original home of Gatwick airport. And has sent its fuel-inefficient jumbo jets to the scrapheap.
Mr. Weiss said it was “almost impossible” to predict the future and would not speculate on when the airline could next need cash if the international aviation market remains closed for longer than its forecasts.
“If travel between the UK and US does not open up for an extended period of time, it is not just Virgin Atlantic that is in difficulty, it is everybody else,” he added.