2600 People Laid Off As Coronavirus Pandemic Forces The Hand Of Yet Another Airline

The coronavirus pandemic has not been kind and especially not to the aviation industry. With commercial flights grounded for more than 3 months now, many airlines have had to resort to laying off staff or even worse, going bust.

The latest in the sad series of airline lay offs involves Indonesia’s Lion Air. Southeast Asia’s biggest carried had already put in place pay cuts and the option for employees to take unpaid leave but that simply wasn’t enough as the airline has announced that it is slashing 2,600 jobs because of the Covid-19 pandemic.

“Lion Air Group is in a difficult and challenging period due to the effects of…Covid-19,” said Lion Air spokesman Danang Mandala Prihantoro.

“The tough decision is taken as a strategy to maintain business continuity, streamline the company’s operations, (and) to reduce expenses and restructure the organisation.”

According to Lion Air, the 2600 layoffs amount to around nine percent of the airline’s total workforce and would mainly affect contract workers. That being said, Prihantoro added that should conditions improve, it will be the laid off employees that will be prioritised for rehiring.

As the coronavirus pandemic continues to ravage industries around the world, the International Air Transport Association has estimated that Indonesia’s flight sector is well on course for a 49 percent drop in passengers and a US$8.2 billion (RM35 billion) plunge in their revenue for 2020 compared to the numbers in 2019.

Back in March, the Centre for Asia Pacific Aviation (CAPA) predicted that most airlines in the world would be bankrupt by the end of May. It’s already July and most airlines seem to be holding on by the skin of their teeth, but the question is.. For how long?

It’s only a matter of time before governments will have to be called in to help out, either in the form of cash injections or subsidies. Will governments even have the means to help? That’s an even bigger question.

So many questions, so little answers. Welcome to the sad reality of the new normal.

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