Etihad Airways cuts jobs as Covid-19 crisis forces global air travel to a near-halt

Airline says travel demand in near future will be "significantly reduced"

Etihad will fly regular services between London and Melbourne from Friday, May 15 with transit passengers able to book flights without obtaining approval to enter the UAE. Courtesy: Etihad. 

Etihad Airways said it cut jobs in several areas of its business, joining global airlines in taking tough measures to slash costs as the coronavirus pandemic forced global air travel to a near-standstill.

"The coronavirus pandemic has brought unprecedented challenges to businesses around the world, and Etihad is no exception," an Etihad spokeswoman said on Tuesday. "It is clear the demand for travel in the near future will be significantly reduced and as a result we must make difficult decisions to ensure Etihad will weather this storm... we have had to make redundancies across several areas of our business to reflect current market conditions.”

The Abu Dhabi-based Etihad Aviation Group, which employed 20,369 people at the end of 2019, did not say how many people were made redundant or in which departments.

The loss-making airline has reduced salaries and grounded its fleet after the UAE suspended passenger flights in March to curb the spread of the coronavirus. The state-owned carrier operates repatriation flights to and from its hub in Abu Dhabi while cargo services continue.

On Tuesday, Etihad said it will increase the frequency of special flights and will add new services to Belgrade, Dublin, Geneva, Milan, Paris, and Toronto. It will also add services to Sydney, allowing a direct transit connection to and from London through Abu Dhabi. This is in addition to a link between Melbourne and London.

Earlier this week, Dubai-based Emirates said it is conducting a "review of costs and resourcing against business projections" after media reports that the airline is considering cutting jobs.

“No announcement has been made regarding mass redundancies at the airline. Any such decision will be communicated in an appropriate fashion," an Emirates spokeswoman said.

The Covid-19 pandemic has battered the global aviation industry with strict lockdown measures wiping out passenger travel demand. Global airlines are facing a liquidity crisis and risk of bankruptcy as revenue withers in the wake of reduced capacity or complete passenger flight suspensions.

Even as lockdown measures begin to lift in some countries, leading chief executives of carriers and trade bodies in the aviation industry warned it may take air travel demand several years to recover to pre-coronavirus levels.

Separately, Etihad Airways and Abu Dhabi's Global Aerospace Logistics (GAL) signed an agreement that will allow the carrier's staff to be seconded to the military and commercial maintenance provider.

Initially for a six-month period, the partnership will allow Etihad staff from maintenance, operations, supply chain and commercial departments to work on several of GAL's major aviation projects. The deal will also extend Etihad’s specialised career training and development.

"Like airlines the world over, Etihad Airways is having to review its current structure and resources and this partnership allows us the opportunity to retain talent for the future; while supporting colleagues in another Abu Dhabi aviation organisation," Tony Douglas, chief executive of Etihad Airways, said.

GAL is part of the Mission Support cluster within EDGE, the UAE's advanced technology group for defence, that was established in November 2019.

“In the current environment, with the Covid-19 pandemic having such an impact on us all, it is only right that organisations within Abu Dhabi come together to support each other through innovative new working partnerships," Sheikh Mohammed Bin Hamad Bin Tahnoon Al Nahyan, vice chairman of GAL and chairman of Abu Dhabi Airports Company, said.