BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh
BBCi CATEGORIES   TV   RADIO   COMMUNICATE   WHERE I LIVE   INDEX    SEARCH 

BBC NEWS
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 


Commonwealth Games 2002

BBC Sport

BBC Weather

SERVICES 
Thursday, 20 September, 2001, 16:39 GMT 17:39 UK
British Airways cuts 7,000 jobs
BA planes
British Airways announced job cuts before the disaster
British Airways has announced it is cutting 7,000 jobs in the wake of the terror attacks on the US.

BA cutbacks
5,200 new job losses
1,800 already announced
20 aircraft withdrawn
10% cut in flying

The figure includes 1,800 job losses announced before last week's atrocities.

BA said 20 aircraft would be withdrawn from operation and it would reduce flying by 10%.

BA chief executive Rod Eddington has not ruled out further job cuts as the full impact of the downturn becomes more apparent.

The BA announcement follows news that American Airlines and United Airlines are to cut 40,000 jobs between them as passenger confidence continues to be devastated by the disaster.

Union leaders in the UK are calling on the government to support the industry after President George W Bush asked Congress to approve an immediate $5bn bailout plan for US airlines.


There is no question of a bail-out for the industry. This government is not into that sort of approach

Transport Secretary Stephen Byers
And the Transport and General Workers' Union (TGWU) has expressed disappointment at the redundancies, adding it will do all it can to mitigate the worst effects of the bad news.

"This is very bad news. We are disappointed that the company has reacted so quickly and with such large numbers of jobs to go across the board," said Tim Lyle, TGWU national secretary for civil air transport.

Click here to see how the world's airlines are cutting costs

But Transport Secretary Stephen Byers, who met union leaders on Thursday, said there would be no US-style rescue package.

"There is no question of a bail-out for the industry," he told the BBC.

"This government is not into that sort of approach.

"Targeted support in these exceptional circumstances, though, would be appropriate."

European law prevents EU countries from providing direct state aid to companies in financial difficulties.

Where axe will fall

British Airways has been hit by the expected fall in numbers on transatlantic routes, which make up 38% of the firm's capacity.

It plans to cut 400 pilots' jobs and 2,300 cabin crew posts as part of the 7,000 losses.

Around 3,000 jobs will go in marketing, management, administration and other support departments, 850 in checkout and other ground customer services and 450 in engineering.


BA wants a one-off hit - take these job losses and then move on

Jeff Randall, BBC Business Editor

The job losses represent approximately 12.5% reduction of British Airways current workforce. BA employs 56,501 people.

The company said it hoped to avoid compulsory redundancies but could not guarantee it.

British Airways shares were down more than 10% at 146p at 1230 GMT.

'One-off hit'

BBC Business Editor Jeff Randall said BA wanted to "stay ahead of the curve" by announcing 7,000 redundancies in one go, rather than piecemeal.

"BA wants a one-off hit - take these job losses and then move on." he added.

But Roger Lyons, of the Manufacturing, Science and Finance (MSF) union, urged calm.

"We are counselling caution. We want the companies to be cautious in the light of last week's disaster, " he told BBC News 24.

"We want to see how stability returns to the industry. There will be air travel in the future and BA, for example, and Virgin will be major players in that."

Unpaid leave

BA said it hoped to achieve reductions by unpaid leave, converting full-time jobs to part-time, cuts in overtime, natural turnover and releasing contract and agency staff.


If we can mitigate the worst effects of this bad news we will

Tim Lyle, TGWU
Early retirement and voluntary severance will only be offered where "absolutely necessary".

There is no timescale for the job cuts, but a BA official said the airline wanted to move "quickly and decisively".

BA said it would be making a later announcement on the impact of the reductions on its flight schedules.

Subsidising routes

BA, which lost 300m on European operations last year, relies on transatlantic business to subsidise loss making routes.

Cabin crew
A wide range of jobs could be at risk

It said it could not say how many of its 36 daily flights to the US will be affected.

Christopher Darke, general secretary of the British Airline Pilots Association, said: "Not all the jobs have to go. We are pressing the Government very hard to give back to the airlines the passenger tax.

This would give airlines 1 billion a year which can be spent improving security and saving jobs."

More cuts expected

The BA announcement is not expected to be the industry's last, and some companies may not survive the downturn.

Virgin Atlantic has already said it plans to cut 1,200 posts.

Boeing, which has 250 UK staff, has also announced that it will lay off between 20,000 and 30,000 staff because of capacity reductions anticipated by its customers.

Representatives from British Airways and Virgin Atlantic have already met Mr Byers to urge him to give the same level of financial support as foreign rivals.

Here is how airlines and the aerospace industry have been affected by the crisis:

Click here to return to text

 WATCH/LISTEN
 ON THIS STORY
The BBC's Jeff Randall
"BA's descent started way before the World Trade Center disaster"
BA Chief Executive Rod Eddington
"This is about as bad as it gets"
The BBC's Brian Milligan
"The level of government support is still unclear"
See also:

20 Sep 01 | Business
Profile: British Airways
20 Sep 01 | Business
What now for British Airways?
20 Sep 01 | UK
Anger over job cuts
09 Sep 01 | Business
British Airways confirms job cuts
04 Sep 01 | Business
British Airways cuts 1,800 jobs
18 Sep 01 | Business
UK airlines call for state aid
19 Sep 01 | Business
US airlines lose 40,000 more jobs
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories