Spirit Airlines (SAVE) - Get Report employees are likely facing furloughs as the pandemic continues to pulverize the airline industry - and as billions in government funds meant to keep airline workers on the payroll runs out.
According to an internal memo, Miramar, Fla.-based Spirit is set to inform its unions its plans to furlough as much as 30% of its workforce in October, making it the first low-cost U.S. carrier to implement job cuts due to the coronavirus pandemic.
“It’s now clear that the demand increase we saw in June was an outlier, and the downward trend will continue,” CEO Ted Christie said in the memo, adding that the airline’s expected daily cash burn of more than $100 million per month in the coming months “is not sustainable.”
With the government's airline stimulus package set to expire in September, several carriers including Spirit are now warning of furloughs, given that demand still has not recovered.
Indeed, American Airlines (AAL) - Get Report and United Airlines (UAL) - Get Report have warned that more than 60,000 jobs are potentially at risk, though others airlines including Southwest Airlines (LUV) - Get Report and JetBlue Airways (JBLU) - Get Report have so far said they can avoid furloughs.
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