British Airways Prepares To Slash Up To 12,000 Jobs As Aviation Outlook Worsens

International Consolidated Airlines Group, or IAG, is preparing to cut up to 12,000 jobs at its subsidiary, British Airways, or BA, in response to the collapse in business caused by the coronavirus pandemic.

IAG said it needs to implement a "restructuring and redundancy program" until demand for air travel returns to levels seen in 2019 – which it admits may take several years.

"The proposals remain subject to consultation [with unions], but it is likely that they will affect most of British Airways' employees and may result in the redundancy of up to 12,000 of them," IAG stated.

BA employs about 42,000 people in total, including 4,500 pilots and 16,000 cabin crew.

BA chief executive Alex Cruz wrote to staff: "Yesterday, British Airways flew just a handful of aircraft out of Heathrow [Airport]. On a normal day we would fly more than 300. What we are facing as an airline, like so many other businesses up and down the country, is that there is no ‘normal’ any longer. In the last few weeks, the outlook for the aviation industry has worsened further and we must take action now. We are a strong, well-managed business that has faced… and overcome, many crises in our hundred-year history. We must overcome this crisis ourselves, too. There is no government bailout standing by for BA and we cannot expect the taxpayer to offset salaries indefinitely... We will see some airlines go out of business."

Cruz added: “We do not know when countries will reopen their borders or when the lockdowns will lift, and so we have to reimagine and reshape our airline and create a new future for our people, our customers and the destinations we serve… Any money we borrow now will only be short-term and will not address the longer-term challenges we will face."

IAG, which also owns Spain’s Iberia Airlines and Ireland’s Aer Lingus, posted operating losses of €535 million ($580 million) during the first quarter of the year - most of which were connected to BA’s activities.

The first quarter’s results also included $1.4 billion in fuel and currency hedging write-offs

Given that virtually all of its airplanes are grounded, IAG expects a second quarter loss that will be “significantly worse” than the first quarter.

IAG reportedly has cash and undrawn credit lines totaling 9.5 billion euros ($10.3 billion)

BA has already put 22,600 people on the U.K. government’s furlough program.

In response to the warning, the British Airline Pilots' Association, or BALPA, trade union, vowed to fight for every job.

Brian Strutton, BALPA’s general secretary, stated: "BA pilots and all staff are devastated by the announcement of up to 12,000 possible job losses in British Airways. This has come as a bolt out of the blue from an airline that said it was wealthy enough to weather the COVID storm and declined any government support. BALPA does not accept that a case has been made for these job losses and we will be fighting to save every single one."

Others also reacted to the planned job cuts.

Kevin Maguire, the Daily Mirror’s associate editor, tweeted: “Government needs to stop British Airways’ owner IAG making up to 12,000 workers redundant. Buy a stake, pass a law… finance, do something. BA can be hugely profitable again after the coronavirus emergency.”

British television personality Piers Morgan tweeted: “If the [government] is bailing out Victoria Beckham's loss-making vanity fashion company with taxpayer money, it should bail out our flagship airline.”