British Airways Says Pandemic May Cost 10,000 Jobs

(Bloomberg) — British Airways is expecting to cut as many as 10,000 jobs due to the Covid-19 pandemic even as the airline reached deals or agreements in principle with its various unions.

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Crew members prepare an air stair for a passenger aircraft, operated by British Airways, a unit of International Consolidated Airlines Group SA (IAG), at Bournemouth Airport in Bournemouth, U.K., on Tuesday, March 31, 2020. European airlines will take the biggest hit to demand from the coronavirus, with passenger traffic set to fall 46% this year, according to economists at the International Air Transport Association.

The flagship U.K. carrier has seen 7,200 people leave as of last week, Chief Executive Officer Alex Cruz told lawmakers in London on Wednesday. The company remains in discussions with some labor groups, he said, and has rowed back on a plan to fire and rehire staff on new contracts.

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British Airways, part of IAG SA, has previously come under fire from unions and lawmakers for its initial plan to cut as many as 12,000 workers. Over summer, the Transport Select Committee accused the airline of using the coronavirus as an excuse to slash the payroll. The pandemic has reversed decades of growth in the aviation industry, shutting down flights and triggering a slump that could see traffic diminished for years.

Huw Merriman, chairman of the committee, said he welcomed the airline’s decision to back away from the fire-and-rehire plan.

Read More: Lockdowns Halt Europe’s Air-Travel Recovery, Threaten Jobs

BA is currently operating about 25-30% of its capacity, Cruz said, with ever-changing quarantine rules around Europe having an impact on demand.

The carrier is seeking a resumption of flights between New York and London, with tests on arrival and five days later, to shorten self-isolation requirements and to spur travel across the Atlantic. IAG’s most profitable route remains all but shut due to travel restrictions, depriving the company of a trip that generated about 7 million seat sales last year.

(Updates with comment from chairman of transport committee in fourth paragraph. A previous version corrected the amount of capacity being operated.)

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