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Budget airline Ryanair is drawing up plans to cut up to 3,000 jobs and close bases in Europe as the airline addresses the massive business downturn caused by the coronavirus outbreak.
Accusing European governments of unfairly bailing out major competitors, the low-budget airline announced on Friday a restructuring program that includes unpaid vacation plans and pay cuts of up to 20%.
In a company statement sent to Euronews, the airline says the plans will be “subject to consultation” and “may result in the loss of up to 3,000 jobs primarily for pilots and cabin crew … and the closure of several bases airplanes across Europe until traffic recovers. ” Office staff would also be affected, the company added.
Ryanair blames “expected significant decline” in air traffic this year, and “distorted” competition for what it says is 30 billion euros in “targeted doping of state aid for flag carriers” in Europe.
Michael O’Leary, CEO of Ryanair, whose 50% pay cut will now run until March 2021, according to the company, highlighted to the French and German governments.
“We are sorry for these job cuts. We are sorry for these pay cuts, but they are what well-run airlines like Ryanair and others will have to do to survive and compete against companies like Lufthansa and Air France that receive tens of billions of states help from their national governments, “he said.
“The French government, for example, in the last month announced a rule that it will reimburse airport taxes, but only for French Airlines. It is grossly unfair. It violates state aid rules and violates competition rules.”
Anticipated ‘job loss tsunami’
Ryanair says it intends to challenge “illegal and discriminatory” state aid in European courts, which it claims is a violation of EU rules. The company adds that it will operate less than one percent of its flights from April to June, and that it expects passenger numbers to not return to 2019 levels until mid-2022 at the earliest.
Following the budget airline’s announcement on Friday, Brian Strutton, Secretary General of the British Airline Pilots Association, said he expected a “job loss tsunami” to hit the aviation industry.
“I hope that all airlines are making similar announcements now and we will see an industry in crisis,” he said.
Earlier this week, British Airways said it may have to cut up to 12,000 jobs from its 42,000 workforce.
BA’s parent company IAG, which also owns Iberia and Vueling, explained the announcement saying it would take several years to return to previous passenger levels.
The Unite union has accused the airline of acting too soon, defending government-backed schemes as long as they are industry-wide.
Oliver Richardson, the union’s National Aviation Officer, told Sky News that Ryanair and IAG were trying to “eliminate competition and dominate the market.”
