American Airlines Plans 30% Cut to Management and Support Staff

American Airlines is slashing costs as the coronavirus pandemic severely curtails air travel.
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American Airlines  (AAL) - Get Report plans to cut its management and support staff by about 30% to slash costs as the coronavirus pandemic has severely curtailed air travel.

The airline must “plan for operating a smaller airline for the foreseeable future,” Executive Vice President of People and Global Engagement Elise Eberwein said in a letter to employees, Reuters reported.

American will offer voluntary options to its 100,000 employees before implementing involuntary reductions if there aren't enough takers.

Once American reduces its management ranks, the airline will turn to frontline employees including flight attendants and pilots, who will receive fresh voluntary leave and early retirement options in June with the goal of avoiding involuntary furloughs, Reuters reported.

Rival United Airlines  (UAL) - Get Report also has said it plans management cuts of 30%.

United said earlier in May it plans to cut at least 3,400 management and administrative positions in October, and a report said pilots were told to prepare for a “displacement” that would affect roughly 30% of their ranks.

United Airlines CEO Scott Kirby last week told shareholders that the company was hoping to avoid further staff cuts.

"We'll be taking time in the months ahead to work with our union partners on creative ideas that would involve reduced hours and leaves of absence instead of furloughs," said Kirby.

American and United are among several U.S. airlines that have accepted U.S. government payroll aid that bans job cuts until Sept. 30.

Shares of American Airlines fell 4.67% to $11.42 in trading Thursday,  while United declined 3.82% to $29.52.