'Weakened' Finnair to negotiate 500 job cuts
Friday June 13, 2008 Finnair announced yesterday that it will begin negotiations with personnel regarding cuts in production that it anticipates will affect approximately 500 employees through layoffs and terminations, an adjustment in the number of temporary staff and reducing workers to part-time status.
It said the "exact nature of the cuts will become apparent during the negotiations." Senior VP-Human Resources Anssi Komulainen said, "To ensure the company's growth strategy, we need additional cuts of at least €50 million ($77.5 million) per year and we have begun discussions with our personnel to map out savings targets" (ATWOnline, June 12).
The airline admitted that "demand has decreased and this decrease has accelerated at such a rate in the past weeks that together with the price development of fuel, Finnair's result-making capability has significantly weakened" (ATWOnline, May 23).
by Kurt Hofmann
US Airways unveils initiatives to tackle 'unprecedented times'
Friday June 13, 2008 US Airways yesterday unveiled a range of initiatives designed to negotiate what Chairman and CEO Doug Parker called "this new and challenging environment," including introduction of a $15 charge for the first piece of checked baggage, aircraft returns and up to 1,700 job cuts.
Similar to its domestic rivals, US is facing a fiscal crunch as a result of soaring fuel costs. It said its 2008 fuel expense will increase by $1.9 billion from the previous year to 39% of the mainline and regional total. It lost $236 million in the first quarter.
"Our industry is profoundly challenged by the dramatic increase in fuel prices and we must write a new playbook for running a profitable airline," Parker said. "We are taking every action to operate a strong and competitive airline, while ensuring that our customers have continued access to competitively priced air travel."
The carrier will return 10 mainline aircraft through next year, cancel leases on two A330-200s scheduled to arrive in the 2009 second quarter and is "planning to reduce additional aircraft in 2009 and 2010." Returned aircraft will comprise six 737-300s this year and four A320s in the 2009 first half.
Fourth-quarter mainline domestic capacity will be cut 6%-8% year-over-year, above the originally planned 2%-4%. Total fourth-quarter mainline capacity will be down 4%-6%, with full-year capacity now projected to be 1%-3% below 2007. Significant reductions will come at its Las Vegas base, where it will end its night operation and reduce daily departures to 81 by Sept. 3 from a high of 141 one year before.
US said its payroll trim will comprise approximately 300 pilots, 400 flight attendants, 800 airport and ground employees and 200 office and management staff. It expects front-line cuts to be accomplished through attrition, and said that "any necessary furloughs following the summer travel season will be offset as much as possible by voluntary leaves of absence as permitted by the respective labor contracts."
It also will close its lounges at Baltimore and Raleigh-Durham in addition to three arrivals lounges in Europe and three domestic cargo stations.
To generate more revenue, US has joined American Airlines and United Airlines in charging for the first checked bag. The fee will apply to tickets purchased from July 9 on domestic flights and those to Canada, Latin America and the Caribbean, with certain exceptions. It will end another traditional amenity on Aug. 1 when it begins charging $2 for nonalcoholic beverages in domestic economy cabins. New fee structures also will be applied to non-Internet ticket purchases, award redemptions and other services.
"The actions we are announcing today, coupled with our strong relative cash position and no material debt payments until 2014, will help US Airways persevere through these unprecedented times for our industry," Parker said.
by Brian Straus
Friday June 13, 2008 Finnair announced yesterday that it will begin negotiations with personnel regarding cuts in production that it anticipates will affect approximately 500 employees through layoffs and terminations, an adjustment in the number of temporary staff and reducing workers to part-time status.
It said the "exact nature of the cuts will become apparent during the negotiations." Senior VP-Human Resources Anssi Komulainen said, "To ensure the company's growth strategy, we need additional cuts of at least €50 million ($77.5 million) per year and we have begun discussions with our personnel to map out savings targets" (ATWOnline, June 12).
The airline admitted that "demand has decreased and this decrease has accelerated at such a rate in the past weeks that together with the price development of fuel, Finnair's result-making capability has significantly weakened" (ATWOnline, May 23).
by Kurt Hofmann
US Airways unveils initiatives to tackle 'unprecedented times'
Friday June 13, 2008 US Airways yesterday unveiled a range of initiatives designed to negotiate what Chairman and CEO Doug Parker called "this new and challenging environment," including introduction of a $15 charge for the first piece of checked baggage, aircraft returns and up to 1,700 job cuts.
Similar to its domestic rivals, US is facing a fiscal crunch as a result of soaring fuel costs. It said its 2008 fuel expense will increase by $1.9 billion from the previous year to 39% of the mainline and regional total. It lost $236 million in the first quarter.
"Our industry is profoundly challenged by the dramatic increase in fuel prices and we must write a new playbook for running a profitable airline," Parker said. "We are taking every action to operate a strong and competitive airline, while ensuring that our customers have continued access to competitively priced air travel."
The carrier will return 10 mainline aircraft through next year, cancel leases on two A330-200s scheduled to arrive in the 2009 second quarter and is "planning to reduce additional aircraft in 2009 and 2010." Returned aircraft will comprise six 737-300s this year and four A320s in the 2009 first half.
Fourth-quarter mainline domestic capacity will be cut 6%-8% year-over-year, above the originally planned 2%-4%. Total fourth-quarter mainline capacity will be down 4%-6%, with full-year capacity now projected to be 1%-3% below 2007. Significant reductions will come at its Las Vegas base, where it will end its night operation and reduce daily departures to 81 by Sept. 3 from a high of 141 one year before.
US said its payroll trim will comprise approximately 300 pilots, 400 flight attendants, 800 airport and ground employees and 200 office and management staff. It expects front-line cuts to be accomplished through attrition, and said that "any necessary furloughs following the summer travel season will be offset as much as possible by voluntary leaves of absence as permitted by the respective labor contracts."
It also will close its lounges at Baltimore and Raleigh-Durham in addition to three arrivals lounges in Europe and three domestic cargo stations.
To generate more revenue, US has joined American Airlines and United Airlines in charging for the first checked bag. The fee will apply to tickets purchased from July 9 on domestic flights and those to Canada, Latin America and the Caribbean, with certain exceptions. It will end another traditional amenity on Aug. 1 when it begins charging $2 for nonalcoholic beverages in domestic economy cabins. New fee structures also will be applied to non-Internet ticket purchases, award redemptions and other services.
"The actions we are announcing today, coupled with our strong relative cash position and no material debt payments until 2014, will help US Airways persevere through these unprecedented times for our industry," Parker said.
by Brian Straus
