Iberia to cut 2,500 jobs as losses loom
By Mark Odell
Published: November 14 2001 14:54 | Last Updated: November 14 2001 15:04
Iberia, the Spanish flag carrier, said it would axe 9 per cent of its workforce as it cuts costs in reaction to the sharp downturn in the global aviation industry.
The company told unions it plans to cut 2,516 jobs as part of a wider restructuring, which includes an 11 per cent capacity reduction and a freeze on aircraft deliveries, in a bid to save Pta27bn ($142m) by the end of 2003.
The decision has been expected by its 27,000-strong workforce and follows similar moves by almost all major airlines in both Europe and the US.
The announcement followed a warning by Iberia on Monday that the crisis gripping the industry could push it into operating losses for the full-year, its first since the government agreed a rescue plan for the airline in 1994.
It remains unclear if the job losses include the 1,400 ground staff that Iberia said it planned to lay off by the end of 2003 in its prospectus for its initial public offering earlier this year.
Iberia said if the measures were not implemented it would suffer a loss of Pta46.7bn next year, instead of a projected profit of Pta17.5bn envisaged in its strategic plan.
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