Etihad Cancels Aircraft Orders, Lays Off Pilots
Jeff Edwards January 14, 2019
Bloomberg reports that beleaguered Gulf carrier Etihad will deepen austerity measures by laying off at least 50 pilots by the end of the month and cancelling an order for ten new Airbus A320neo aircraft. The moves follow the state-controlled airline’s decision to trim its route map following mounting financial pressure and persistent takeover rumors.
An internal memo reveals that struggling Gulf carrier Etihad will eliminate 50 pilot positions and cancel a commitment to purchase ten new Airbus A320neo aircraft. The deep cost-cutting measures come after a series of earlier layoff announcements and a major route consolidation last year.
The Gulf carrier has faced growing financial pressure following a long-term decline in demand for premium long-haul air travel, in part due to tough economic conditions in the Gulf region. A series of disastrous investments in “partner” airlines, including Alitalia, Jet Airways and Air Berlin further strained the carrier’s bottom line.
In January of 2018, Etihad allegedly asked flight crews to request voluntary unpaid leave in an attempt to achieve cost savings soon after the airline grounded its entire fleet of underused Airbus A330 cargo planes.
Now, Etihad’s letter to employees, obtained by Bloomberg, indicates that the belt tightening at the long-haul carrier is continuing in full force. In the memo, reportedly signed by Vice President for Flight Operations Sulaiman Yaqoobi, the airline says the sudden pilot reductions are part of an effort to trim operating costs by at least 10 percent during a period of “extremely challenging” economic conditions. Yaqoobi told workers the layoffs were a “small reduction” in the airline’s overall number of flight crew members.
While the carrier has confirmed that canceling its large Airbus order is a part of plans to dramatically cut expenses, Bloomberg’s Layan Odeh notes that, so far, standing orders and commitments to purchase hundreds of Airbus A350 aircraft and Boeing-made 737 and 787 planes have not been axed by the airline. The carrier is known to have one of the highest number of new planes on order of any airline industry-wide.
Meanwhile, the airline has been the subject of persistent rumors of an impending takeover. In the past year, rival Emirates, long-haul competitor Lufthansa and even British Airways-parent company IAG have all been placed in the position of having to go on record to deny plans to gain control of Etihad.
[Image: pixabay]
Etihad do not operate or have any orders for the Boeing 737.
in Australia Etihad have been advertising some of the cheapest fares to Europe of any full service carrier. Scoot on the other hand advertised last week, AUD$309 one way to Berlin & Athens from various Australian ports. That's around USD$222 for 10,000 miles of flying. No food or bags but they don't cost much extra. Many seats at those prices ? Who knows & you have to stop in Singapore, as connections might not be good, but at those prices who cares + can upgrade to Scoot Biz for not much more.