MIAMI – The TUI Group announced today that it will slash 8,000 jobs to save €300m. The move is a response to an unprecedented 83% fall in its summer bookings.
Since TUI Airways (BY) restarted its flights, it has carried 1,4 million passengers. But the group also specified in the statement how the ongoing travel changes have affected its business. Accordingly, BY has cut capacity from 30% to 25% in Q4 and moved to alternative low-risk destinations.
While the holiday carrier will not receive its full savings until 2022, it currently has an extra German government aid of US$1.4bn.
Actions amid Uncertain Times
TUI Group CEO Friedrich Joussen said that destination availability remains volatile. He expects this trend will continue for the next few quarters.
Joussen added that more available COVID-19 tests are needed on arrivals and departures. With such testing at airorts, he believes that the compulsory quarantine and movement restrictions could be phased out.
Additional Cash Injection
Despite the travel restrictions, according to Joussen, BY is strategically well placed to benefit as leisure travel volume recovers. Apart from state aid, the airline secured a compensation deal with Boeing for the grounded 737 MAX aircraft. As a result, the manufacturer will pay a three-year indemnification and delay 61 deliveries.
Featured photo: TUI Group