British Airways to Cut 5,000 Jobs in Restructuring Move
British Airways intends to cut 5,000 jobs in Britain as part of a $1.55-billion restructuring program, its chief executive said Wednesday. The cuts represent about 10% of the airline’s work force.
Chief Executive Bob Ayling said the company hopes to make the cuts in 18 months largely through retirement and voluntary resignation. They will affect workers from pilots to ground crews.
British Airways will continue to recruit staff with certain customer service and language skills, and by 2000 it expects its work force to be about as large as it is now, he said. It employs about 49,000 people overall.
“I do not expect wholesale job losses. Jobs will also be created and jobs secured. We will grow and we will improve. I am committed to a strategy of investment and improved profitability,” Ayling told a news conference at Heathrow Airport.
The company reports it has already identified a number of areas where revenue can be increased and costs reduced.
Plans include reducing the cost of in-house activities such as check-in, baggage loading and plane refueling, which might be turned over to subcontractors if doing so saves money.
In addition, the company plans to restructure its money-losing TAT European Airlines and Deutsche alliances and may sell its engineering division.
British Airways also plans to reduce the amount of money spent on advertising and promotion and create new in-flight revenue, such as interactive in-flight entertainment.
