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British Airways Cuts Another 6,000 Jobs - 2002-02-13


British Airways, in an effort to cuts costs and whittle down debt, said it was cutting close to 6,000 jobs or almost 12 percent of its workforce - and plans a significant restructuring.

With losses mounting, British Airways, Europe's largest airline, says it will slash 5,800 jobs. This is in addition to the 7,200 jobs the airline cut shortly after September 11 attacks. In less than six months, the airline has eliminated nearly a quarter of its workforce.

According to British Airways chief executive Rod Eddington, the goal is to make British Airways a simpler, leaner, more focused airline.

Not all of British Airways' problems can be blamed on the attacks last year in the United States. It has also been hurt by competition from low-cost air carriers.

After reporting record profit just six years ago, British Airways currently loses nearly $3 million a day.

One of Britain's top union leaders, Bill Morris, says he was aware that British Airways was facing financial difficulties, but he says the number of jobs cut still came as a shock.

"We expected mild surgery but what we have got is savage butchery," he said. "And 13,000 jobs since September 11 represents much more than anticipated."

British Airways spokesman Martin George says the job cuts are necessary to turn the air carrier around.

"Fundamentally, we have to ensure that we have the right base to grow," he said. "And having the right base to grow means that we have a cost base that is competitive against our biggest competitors and that is not only the full service carriers, but increasingly the low-cost carriers."

British Airways claims that its latest job reductions, combined with those announced in September, will save the company $931 million a year.

In another move to save money, the airline plans to eliminate ten routes and reduce its air fleet by 49 planes.

But many aviation industry observers believe that the only way British Airways can survive in the long term is to forge an alliance with another airline that would help boost revenues and cut costs further.

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