British Airways is set to embark on a restructuring and redundancy programme that could lead to up to 12,000 job losses, parent IAG has confirmed.
IAG said the proposals, announced on Tuesday (28 April), remain subject to consultation, but are "likely to affect most of British Airways’ employees".
Earlier this month, the Unite union approved BA’s proposal to furlough some 22,626 employees under the government’s job retention scheme,
However, in a letter to staff, BA chief executive Alex Cruz said "there was no government bailout standing by for BA".
"We cannot expect the taxpayer to offset salaries indefinitely," said Cruz. "Any money we borrow now will only be short-term, and will not address the longer-term challenges we will face."
IAG said on Tuesday the impact of Covid-19 on the group’s current operations, and the likelihood it would take "several years" for passenger demand to return to 2019 levels had necessitated the group-wide restructuring measures.
"Yesterday [Monday], British Airways flew just a handful of aircraft out of Heathrow," said Cruz. "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.
"This has been a difficult message to write and one I never thought I would need to send. I know how tight-knit the BA family is, and how concerned you will be, not just for yourself but for your colleagues too.
"We must act decisively now to ensure that British Airways has a strong future and continues connecting Britain with the world, and the world with Britain."
In a first quarter trading update, IAG confirmed BA was formally notifying its trade unions about the proposed restructuring and redundancy programme.
"The proposals remain subject to consultation but it is likely they will affect most of British Airways’ employees, and may result in the redundancy of up to 12,000 of them," said IAG.
The group revealed total Q1 revenue fell 13% year-on-year to €4.6 billion compared with €5.3 billion; its €135 million Q1 2019 operating profit, meanwhile, has swung instead to a dramatic €535 million loss before exceptional items. Pre-tax profit was impacted by an exceptional charge of €1.3 billion owing to over-hedging fuel and foreign currency.
IAG passenger capacity fell 10.5% during the quarter, and load factors by 4.3 percentage points to 76.4%. The group has reduced April and May passenger capacity by 94% year-on-year, and stressed passenger capacity from June would depend on whether government lockdowns and travel restrictions are eased.
Pilots union Balpa has said it will fight to save every single proposed job cut at BA.
"BA pilots and all staff are devastated by the announcement of up to 12,000 possible job losses in British Airways," said the union in a statement.
"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."