United Airlines Holdings (UAL) - Get Report warned Wednesday that it may have to cut 45% of its workforce, or 36,000 employees, as the carrier struggles with the impact of the coronavirus pandemic shutdown.
Shares of the Chicago airline at last check were off 3.2% to $31.53.
The airline said it was preparing to send notices of potential furloughs to 36,000 U.S.-based front-line employee, Reuters reported.
The effective date would be Oct. 1, when a ban on forced job cuts by airlines that accepted billions of dollars in federal payroll aid expires.
Not everyone who receives a notification will be furloughed, United said, with the final number depending on how demand evolves and how many employees accept early exit packages and temporary leaves.
While 3,700 have already taken an early-out option, the potential losses affect 15,000 flight attendants, 11,000 airport staffers, 5,500 maintenance positions and 2,250 pilots, the company told reporters on a conference call.
The airline industry has been devastated by the coronavirus pandemic as self-quarantine and social-distancing requirements forced severe reductions in travel.
The Cares Act, the coronavirus relief package, set aside $25 billion in loans for air carriers.
Fallout from the coronavirus pandemic is “the worst crisis to hit the airline industry and United Airlines,” a United executive said on Wednesday, according to Reuters. “We can’t count on additional government support to survive.”
Association of Flight Attendants-CWA President Sara Nelson said in a statement that the "projected furlough numbers are a gut punch, but they are also the most honest assessment we've seen on the state of the industry."
Last month, United Airlines said that its financial outlook was improving and that it's taking a new $5 billion loan, backed by its mileage awards program.