United Airlines will close its cabin crew bases in Hong Kong, Tokyo and Frankfurt, eliminating a total of 840 jobs, as the Covid-19 pandemic continues to wreak havoc on international air travel.
The Chicago-headquartered carrier told its employees on Friday of the “difficult decision”, with the Hong Kong base hit hardest with 319 jobs lost. The airline has been associated with the city since the 1990s.
With scores of jobs in the aviation sector under threat, airlines are looking overseas to cut back on employment first.
Cathay Pacific closed all of its North American flight attendant bases in five cities over the past 14 months with the loss of 566 employees, more recently announcing the closure of its US bases in April.
“In the current and future environment, we simply are not able to sustain an in-flight base at these locations,” United’s senior vice-president of in-flight services John Slater said.
“We recognise that closing any base places hardship on those who live near those locations.”
Affected crew members, however, would be given job opportunities in the United States, depending on eligibility.
The closures will take effect from October 1, the first day of the expiry of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a package of US$50 billion (HK$387.5 billion) in government grants and loan guarantees for US carriers. Airlines were not permitted to lay off staff before the end of September as part of the payroll aid package.
Some 300 United Airlines flight attendant roles will be lost in Tokyo and 220 in Frankfurt, out of a total of 24,000 employed globally.
Last month, United earmarked a 30 per cent reduction to its 11,500 management and administrative roles, while another 30 per cent of 12,250 pilots could be “displaced”.
United is one of the big four US carriers. It employed 96,000 people as of the end of last year and operated about 1,350 aircraft.
The collapse in air travel globally amid the pandemic has shaken the industry to its core, leaving most carriers fighting for survival and many more acting swiftly to stay afloat through government bailouts, asset sales and piling on bank loans.
The International Air Transport Association said that airlines faced losing US$314 billion in ticket sales this year, which accounts for 55 per cent of all passenger revenue generated last year.
Most airlines are predicting a recovery to take at least three years, with long-haul international air travel the slowest to regain its health.
No airline has been spared by the pandemic. British Airways outlined 12,000 job cuts – or 30 per cent of its staff. Budget airline group easyJet indicated a similar percentage cut, affecting 4,500 employees. Virgin Atlantic will trim its workforce by 3,000, while German carrier Lufthansa said it would need to cut more than 10,000 jobs. Meanwhile, Scandinavian Airlines reduced half of its workforce, eliminating more than 5,000 jobs.
Plane-making giant Boeing has also earmarked a cut of around 16,000 jobs.
In the past, overseas cabin crew bases tended to be a popular means to keep staff costs under control, but over time, this has become increasingly expensive for airlines to maintain.
British Airways in 2018 closed its Hong Kong cabin crew base with the loss of 85 jobs. In 2015, Virgin Atlantic axed two-thirds of its flight attendants in the city, affecting senior staff but sparing junior crew members.
More from South China Morning Post:
- Cathay Pacific to lay off nearly 300 cabin crew in US, calling bases in New York, San Francisco and Los Angeles ‘no longer viable’
- Coronavirus: Cathay Pacific eyes ‘structural change’ to see the Hong Kong carrier through pandemic crisis and its aftermath
- Coronavirus: struggling Cathay Pacific hints at further job losses with pilots now in the firing line