Spanair presents Redundancy Plan
3 September 2009
Spanair's management have presented a Redundancy Plan this month to employee representatives, due to economic, technical and organizational reasons, which affects up to 954 full-time positions, equivalent to a maximum of 1.062 Spanair employees and a maximum of 131 Fuerza de Ventas staff.
This ERE is included within the Feasibility Plan with which Spanair intends to ensure the continuity of the company and secure around 3.000 job positions in the company. It also includes measures such as a 24% capacity reduction, other cost reductions and a total result improvement plan of 90 million euros for 2009. This Feasibility Plan is the company response to the crisis that affects the whole airline industry as consequence of the continuous increase in fuel price, the decrease of demand due to the economy slowdown in the Spanish market and the excess of capacity.
The Feasibility Plan is based on four strategic pillars: re-dimensioning of the aircraft capacity, cost reductions, improvement of efficiency and revenue improvement measures. The total earnings effect in 2009 from these measures is estimated to MEUR 90. The impact of these measures in the company productivity and costs will be gradual from their implementation in September - October 2008.
One of the first measures included in this Feasibility Plan is the capacity reduction through phase-out of 15 aircraft between Sept. 15 and Nov. 1st, which means a reduction of 24% of Spanair operations, as well as the cancellation of 9 routes and the reduction of most unprofitable frequencies in other routes.
The Feasibility Plan also includes concentration of Spanair's 7 operational bases (Barcelona, Bilbao, Las Palmas, Madrid, Málaga, Tenerife Norte and Palma de Mallorca) into 2 (Barcelona and Madrid) with the aim to simplify operational activities, increase efficiency, reduce operational costs and ensure the Company's feasibility.
From the time of today's presentation of this Labour Reduction File, a period of 30 days negotiation begins for the company and the employee representatives to reach an agreement.