Qatar Airways Plans ‘Substantial’ Job Cuts In Response To Coronavirus Shutdown

Qatar Airways said it plans to cut a “significant” number of jobs as the coronavirus pandemic has virtually shut down air travel.

The state-owned flag carrier of Qatar warned back in March that it was burning through its cash reserves.

"The global outlook for our industry looks grim and many airlines are closing or significantly reducing operations," Chief Executive Akbar Al Baker wrote in a memo to employees. “We have to face a new reality, where many borders are closed, rendering many of our destinations closed and aircraft grounded as a result, with no foreseeable outlook for immediate, positive change. The truth is, we simply cannot sustain the current numbers and we need to make a substantial number of jobs redundant -- inclusive of cabin crew."

Al Baker did not indicate the precise number of jobs that will be cut.

Doha-based Qatar Airways Group, which includes the airline, had 46,684 employees as of March 2019.

But the notice from Al Baker assured that employees who are laid off will receive their contractual dues and any overtime owed to them. Those workers who cannot immediately return to their native countries will be given housing and a living allowance until such a return is possible.

Al Baker also said the carrier hoped to rehire staff after the pandemic passes and global aviation is restored.

"The unparalleled impact on our industry has caused significant challenges for all airlines and we must act decisively to protect the future of our business," an airline spokesman said. "As a result, Qatar Airways can confirm that the airline will make a number of roles redundant due to the impact of Covid-19. Any job loss is regrettable, and we will be working closely with all affected employees to offer our full support during this difficult time."

Qatar Airways has a fleet of more than 230 aircraft most of which are based in Doha's Hamad International Airport. Its main regional competitors are Abu Dhabi-based Etihad Airways and Dubai-based Emirates, both of which are state-owned and facing similar problems.

Since the pandemic, Qatar Airways has been focused on repatriation flights to bring its stranded nationals home as well as on cargo transportation. Indeed, over the past month Hamad International Airport and Qatar Airways established a new record for cargo transport.

During the month of April, the airline moved more than 100,000 tons of medical aid and other supplies and equipment to parts of the world hit hardest by COVID-19.

The airline’s freight unit, Qatar Airways Cargo, hit a new record for making cargo flights.

Even before the pandemic, Qatar Airways faced other struggles that hurt its business. In 2017, four Arab countries, the United Arab Emirates, Saudi Arabia, Bahrain, and Egypt, all cut off diplomatic relations with Qatar over a political dispute and boycotted the country, thereby blocking the airline from certain key routes. That boycott remains in place.

Back in March of this year Qatar Airways warned it would need state aid to survive.

“We will surely go to our government eventually,” Al Baker said at the time.

Interestingly, in February of this year, Qatar Airways increased its stake in IAG – the owner of British Airways -- from 21.4% to 25.1%.