3,000 Jobs To Go At Low-Cost Carrier Ryanair

Low-cost airline Ryanair has announced that it will be cutting 3,000 jobs as it struggles to survive the impact of the coronavirus pandemic, i reports. These cuts were revealed in a trading statement issued on Friday. The airline employs about 20,000 staff.

Outlining The Financial Fall-Out

In the document, Ryanair explained how the pandemic has impacted both its first quarter results and how it expects the on-going grounding of flights to impact its future economic outlook.

“Due to Continent wide EU Government flight restrictions, Ryanair expects to operate less than 1% of its scheduled flying program in Apr, May & June 2020. Q1 traffic of less than 150,000 passengers will be 99.5% behind the Q1 budget of 42.4m passengers. While some return to flight services is expected in the second (July-Sept) quarter, Ryanair expects to carry no more than 50% of its original traffic target of 44.6m in Q2,” it advised.

Reviewing Growth In Order To Survive

Explaining its position upon the outbreak of the pandemic, the carrier revealed that it had “entered this unprecedented Covid-19 crisis with almost €4 ($4.3)bn in cash”. In this document, Ryanair outlined its plans to survive the crisis.

It will be, it says, reviewing its plans for growth as well as aircraft orders in order to preserve cash. “We are in active negotiations with both Boeing, and Laudamotion’s A320 lessors to cut the number of planned aircraft deliveries over the next 24 months…to more accurately reflect a slower and more distorted EU air travel market in a post Covid-19 world.”

Large-Scale Job Cuts To Come This Summer

However, a significant part of Ryanair’s contingency plans appear to be centered on large-scale job cuts.

“The Ryanair Airlines will shortly notify their trade unions about its restructuring and job loss program, which will commence from July 2020. These plans will be subject to consultation but will affect all Ryanair Airlines, and may result in the loss of up to 3,000 mainly pilot and cabin crew jobs, unpaid leave, and pay cuts of up to 20%, and the closure of a number of aircraft bases across Europe until traffic recovers,” it said.

“Job cuts and pay cuts will also be extended to Head Office and Back Office teams. Group CEO Michael O’Leary, whose pay was cut by 50% for April and May, has now agreed to extend this 50% pay cut for the remainder of the financial year to March 2021,” it added.

The Future Outlook

As an aside to this latter move, O’Leary told the BBC that customers who wanted cash refunds for canceled flights would receive them, but that, due to the level of staffing cuts, it may take as long as six months to issue them. According to the outlet, the carrier has 25 million refunds to process. O’Leary also admitted that further deeper job cuts were possible.

However, looking towards its eventual recovery, Ryanair also added that its return to operations could be hampered by its competition with many state-run European airlines, who, the airline purports, benefit unfairly from aid from their respective governments.

Ryanair added that, while it could not give a steer on its outlook for the end of this financial year, it was doing its best to manage its cash resources in order to ride out the pandemic and return to normal operations.