The job losses are the first at Singapore Airlines since the SARS outbreak in 2003.
“Having to let go of our valuable and dedicated people is the hardest and most agonizing decision that I have had to make in my 30 years with SIA,” Chief Executive Officer Goh Choon Phong said. “The next few weeks will be some of the toughest in the history of the SIA Group.”
The decision shows that even the world’s top carriers can’t evade the biggest financial crisis in the industry’s history after the pandemic eviscerated air travel. The International Air Transport Association doesn’t expect passenger traffic to recover to pre-pandemic levels until 2024. Singapore Airlines is particularly vulnerable because it has no domestic market to fall back on.
The carrier’s shares were little changed Friday following a 1.1% loss Thursday. They are down 45% this year.
“When the battle against Covid-19 began, none of us could have predicted its devastating impact on the entire aviation industry,” Goh said. “Eight months on, the number of carriers that have collapsed continues to rise. It is still not clear who will ultimately survive this crisis.”
The job losses come despite the airline raising about S$11 billion ($8 billion) through loans and a rights issue in June, and receiving aid from a government job-support program. The Ministry of Finance said it spent about S$15 billion as of July to help companies in the city-state pay staff. Unlike many of its peers, Singapore Airlines initially managed to resist job cuts, though some staff were redeployed to work in hospitals, social services and on Singapore’s transport network.
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