The industry-wide downturn brought on by the ongoing coronavirus pandemic has forced many airlines to cut jobs to reduce expenditure. Even flag carrier airlines like SWISS have not been immune from the economic challenges posed by the global health crisis. The airline’s CEO has disclosed that, despite already making hundreds of job cuts, more may be on the way.
Uncertainty entering the second quarter
In just a few days, the unstoppable tide of time will sweep us from March into April. In business terms, this represents the transition from the first into the second quarter of the fiscal year. This may mean that we will soon see further job cuts at Basel-based SWISS. Its CEO, Dieter Vranckx, recently told Swiss newspaper Sonntagsblick that:
“From the 1,000 announced positions, we completed 500 of the job cuts through the end of 2020. How many additional positions we will potentially have to cut is something I can only answer in the second quarter. We’re in the middle of the analysis.”
SWISS announced the aforementioned 1,000 cuts last October. According to Reuters, it had planned to make these attritionally over a two-year period. This figure represented more than 10% of the airline’s existing 9,000 members of staff. Even once the crisis is over, SWISS is reckoning with lower revenues due to a predicted drop in business travel. It expects this due to the boom in video-conferencing triggered by the pandemic.
Cuts to network as well as personnel
It is not just personnel that SWISS has had to make cuts to since the pandemic began. Indeed, the lack of demand has also forced the airline to make significant reductions to its route network. For example, Simple Flying reported earlier in the year that SWISS had had to remove the majority of its flights from Geneva during February.
These fresh network reductions came about due to the pressure caused by new, mutated coronavirus strains. These strains saw further travel restrictions introduced to prevent their spread. This severely limited both demand and where SWISS (and indeed other airlines) could fly to, hence the cuts. Geneva was chosen as it did not have COVID testing facilities.
Cargo market keeping SWISS busy
However, it is not all bad news for Switzerland’s flag carrier. Like many passenger-focussed airlines, it has been keeping itself busy by expanding its cargo operations. As worldwide vaccination efforts continue to ramp up, there has been a growing airfreight market for pharmaceutical products.
This led to SWISS flying a 14-tonne batch of vaccines from Beijing, China to São Paulo, Brazil via its hub in Zürich last December. Then, in January, the airline announced that it was expanding its freight network to include two more intercontinental destinations. Using converted Boeing 777 ‘preighters,’ its new cargo services will serve Lima, Peru and Seoul, South Korea.
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