The company said in a statement Thursday that it will start a consultation with employees in the coming days to reduce staff numbers. It will also slash its fleet size, make changes to its flight network and find “more efficient ways of working.”
EasyJet has over 15,000 employees, according to its most recent annual report, suggesting that as many as 4,500 jobs could be eliminated.
“We want to ensure that we emerge from the pandemic an even more competitive business than before,” CEO Johan Lundgren said in a statement, adding that the company “will continue to remove cost and non-critical expenditure at every level.”
The carrier said last week that it will resume flying on June 15, servicing a small number of routes mainly in the United Kingdom and France, flying only 30% of its regular capacity over the summer.
“So far, the booking trends on the resumed flights have been encouraging, and the demand indications for summer 2020 are improving, albeit from a low base,” the company said. “Bookings for winter are well ahead of the equivalent point last year, which includes customers who are rebooking coronavirus-disrupted flights for later dates,” it added.
EasyJet does not expect levels of market demand seen in 2019 to be reached again until 2023 and said it is in “active consultation” with airports and ground handlers to reduce costs. It has also deferred spending on maintenance and is renegotiating contracts with advertising agencies. The carrier expects to have 302 aircraft towards the end of next year, about 14% fewer than previously anticipated.
Daniel Roeska, a senior research analyst at Bernstein, described the measures as “exactly the kind of overhaul the cost base needs.”
“The company looks to be focusing on the right things and appears to be seizing the opportunity to reshape its cost base,” he added.
BALPA, the UK pilots union, said it will need “a lot of convincing that EasyJet needs to make such dramatic cuts to jobs,” adding that the airline’s own projections forecast a recovery in passenger numbers by 2023. “This is a temporary problem that doesn’t need this ill-considered knee-jerk reaction,” the union’s general secretary Brian Strutton said in a statement.