British Airways wants to lay off 12,000 of the more than 40,000 employees. The demand for tickets has become minimal due to corona virus and the company says it has no other choice. BA does not want to request support from the British government.
BA CEO Alex Cruz is “very positive” in a letter to staff:
The prospects for the airline industry have deteriorated further in recent weeks. We must do something now. BA is a strong, well-managed company that has overcome many crises in its existence. We have to go through this too, ourselves. There will be no aid package from the government and we cannot expect indefinite salaries to be compensated by taxpayers.
Earlier this month, BA already sent 36,000 people on unpaid furlough. The British government took over the payment of salaries, up to the level of 80 percent. Around 45,000 people work at BA, converted into FTEs, this comes down to 42,000.
Parent company IAG (International Airlines Group) says a program of “restructuring and layoffs” at BA is needed until demand-to-buy returns are back to 2019 levels. Terms are still being negotiated with unions and the UK government.
The IAG, which was established in 2011, also includes the Spanish carriers Iberia and Vueling and the Irish Aer Lingus. In terms of organization, IAG is equally divided between Spain and the United Kingdom.
It is still unclear what will happen at Iberia and Aer Lingus. It seems that Iberia will turn to the Spanish government for state aid.
A complicating factor is that the United Kingdom has not been a member of the European Union since January this year. Spain and Ireland are. Any European Commission aid for aviation would apply to Iberia, Vueling and Aer Lingus, but not BA.