Ryanair (RYA.I) is planning around 3,500 job losses if it cannot agree on pay cuts with its staff, the airline’s boss Michael O’Leary said on Wednesday.
Europe’s biggest budget airline had previously said that it had cut more than 250 staff from its office around Europe and was looking at up 3,000 cuts among pilot and cabin crew. [nS8N2CP05S]
“We’ve already announced about 3,500 job losses but we’re engaged in extensive negotiations with our pilots, our cabin crew and we’re asking them to all take pay cuts as an alternative to job losses,” O’Leary told BBC.
“We’re looking from 20% from the best-paid captains, 5% from the lowest-paid flight attendants and we think if we can negotiate those pay cuts by agreement, we can avoid most but not all job losses,” O’Leary told BBC TV.
Ryanair has seen “very strong” bookings for the first two weeks of July across its network, which it relaunched on Wednesday with 1,000 flights, but expects ticket prices to be lower than ever for 12 months, Group CEO Michael O’Leary said.
FILE PHOTO: A Ryanair plane takes off from Manchester Airport as the spread of the coronavirus disease (COVID-19) continues in Manchester, Britain June 21, 2020. Picture taken June 21, 2020. REUTERS/Phil Noble
Europe’s largest low-cost carrier has been flying a skeleton service since the COVID-19 pandemic closed down much of Europe in March.
It expects to fly around 4.5 million passengers in July, around 40% of its normal service.
That is likely to climb to 5.5 to 6 million in August before settling into normal levels in the quieter winter season and attaining pre-pandemic levels next year, O’Leary told Reuters in an interview.
“Our bookings for our first week or two of flights in July have been very strong. August looks reasonably strong. September and October look a bit weaker at the moment... people are standing back,” he said.
But price levels for tickets have been weak for the summer and are likely to remain so. “Certainly for the next 12 months you are going to see lower-than-ever airfares, certainly on Ryanair, as we stimulate the market and get it back moving again,” he said.
It will likely take until 2022 or 2023 for ticket prices to return to the levels seen before the pandemic, O’Leary added.
Ryanair’s planes will be about 70% full on its first full day of service, O’Leary said.
He said there had been no major teething problems and expected any technical delays from planes returning to service to be offset by a lack of air traffic control issues in Europe’s relatively empty skies.
O’Leary expects a “marked decline” in inflight food and beverage sales, but said he hoped that would be matched by an increase in the number of passengers paying for pre-booked seats and checked-in bags.
He said that while the airline had announced 3,500 job cuts, he was “reasonably hopeful but not confident” it could agree on changes to pay cuts and work practices to avoid most of them.