Singapore Air cuts 20% of jobs as virus smashes travel

Bloomberg

Singapore Airlines Ltd is eliminating about 4,300 jobs, or 20% of its workforce, as the coronavirus outbreak devastates the aviation industry.
The cuts will be made at Singapore Airlines and its SilkAir and Scoot units. Discussions are underway with unions and arrangements will be finalised as soon as possible, the carrier said in a statement.
“Having to let go of our valuable and dedicated people is the hardest and most agonising decision that I have had to make in my 30 years with SIA,” Chief
Executive Officer Goh Choon Phong said. “The next few weeks will be some of the toughest in the history of the SIA Group.”
The decision shows that even the world’s top carriers can’t evade the biggest financial crisis in the industry’s history after the pandemic eviscerated air travel. The International Air Transport Association doesn’t expect passenger traffic to recover to pre-pandemic levels until 2024. Singapore Airlines is particularly vulnerable because it has no domestic market to fall back on.
“When the battle against Covid-19 began, none of us could have predicted its devastating impact on the entire aviation industry,” Goh said. “Eight months on, the number of carriers that have collapsed continues to rise. It is still not clear who will ultimately survive this crisis.”
The job losses come despite the airline raising about S$11 billion ($8 billion) through loans and a rights issue in June, and receiving aid from a government job-support program. The Ministry of Finance said it spent about S$15 billion as of July to help companies in the city-state pay staff.
Unlike many of its peers, Singapore Airlines initially managed to resist job cuts, though some staff were redeployed to work in hospitals, social services and on Singapore’s transport network.
It also imposed a hiring freeze in March and offered early retirement and voluntary redundancies that eliminated some 1,900 positions.
As a result, the potential cuts across the group have been reduced to about 2,400, the airline said. Singapore Airlines and SilkAir are only operating at about 7% of pre-pandemic capacity, and while some routes are reopening, the level is likely to be just 11% by the end of November, it has said.
The job cuts could initially save the airline S$13 million a month until March, when the government’s job support
program is due to end, and
almost S$20 million after, according to James Teo, an analyst with Bloomberg Intelligence in Singapore.
Singapore Airlines is reviewing its fleet size and network. In July, it agreed with Airbus SE to defer deliveries of some aircraft and reschedule some payments.