LONDON – Following the successful approval of its capitalization plan, Virgin Atlantic (VS) will cut an additional 1,150 jobs. VS has up to now cut more than 3,500 jobs out of the 10,000 employees currently in the business at the start of this year.
These continued cuts are due to the ongoing COVID-19 pandemic which has been wreaking havoc on the industry all year.
Commenting on the news was CEO Shai Weiss who expressed respect to its workers over this decision. “After the sacrifices, so many of our people have made, further reducing the number of people we employ is heart-breaking but essential for survival.
“I truly hope that as demand returns, we will see many members of our team returning to us. Together, we have achieved what many thought impossible and that is down to the efforts and sacrifices of so many across the company.”
“The completion of the private-only, solvent recapitalisation of Virgin Atlantic removes much of the uncertainty we faced and represents a major step forward in our fight for survival.”
“We greatly appreciate the support of our shareholders, creditors, and new private investors and together, we will ensure that the airline continues to provide vital connectivity and competition.”
As mentioned yesterday, the restructuring of the carrier, valued at £1.2bn has been approved in order to keep the airline afloat. This deal involves around £400m in new cash, half of which will come from Virgin Group owner Sir Richard Branson.
Therefore, such job cuts would not come as a surprise, as even with a some sort of bailout or financial chance, jobs will have to be cut to ensure sustainability.
A Hectic Year
All year, VS has had to find ways of weathering this particular storm. The carrier has had to respond to the challenges of the pandemic, like with other carriers.
This even resulted in the airline filing for Chapter 15 bankruptcy in the United States to preserve assets.
Preservation of the Airline
Looking ahead, these job cuts, however detrimental it will be to those losing their jobs, will be one of importance for preservation.
The next big question is how the airline will now deal with the travel restrictions still imposed in the United States. Trans-Atlantic travel covers 70% of VS’ takings, which has resulted in the airline having to think out of the box a little.
Between February to August, the airline has announced plans to operate flights to Hong Kong (HKG), Shanghai (PVG), New Delhi (DEL), Lahore (LHE), and Islamabad (ISB).
The Worst is Over
Overall, it remains clear that the focus for Virgin remains solely in Asia, especially until the U.S begins to ease restrictions on travel.
For now, it looks like the worst is over for VS and going forward, it will be do or die for the reliance of the Asian market.
Featured Image: Virgin Atlantic Boeing 787-9 Dreamliner. Picture from JDL Multimedia.