Yahoo Finance Coronavirus: Ryanair cuts up to 3,000 jobs and O'Leary takes pay cut
Ryanair (RYA.L) has warned up to 3,000 mainly cabin crew and pilot staff could lose their josses as it battles to survive the coronavirus crisis.
It comes just days after British Airways owner IAG (IAG.L) announced 12,000 staff could face redundancy, in a grim week for a sector struggling to cope as air travel has plummeted.
Europe’s largest budget airline said some head and back office teams also faced job losses, while group CEO Michael O’Leary agreed to extend his 50% pay cut until March next year.
The Irish airline used a market update on Friday to launch an attack on its European rivals and governments supporting them through the crisis through state aid.
It vowed to take legal action in the European courts after warning such state aid distorted the market in Europe, calling it “unlawful and discriminatory.”
“Ryanair continues to call on EU governments to cut passenger taxes, airport taxes, and departure taxes on an industry wide basis as a better alternative to selective state aid ‘doping’ for flag carriers,” the statement said.
READ MORE: BA job losses dubbed ‘heartless’ as fears of more airline job cuts grow
The market update even included a list of rival airlines as “examples of state aid doping to date.” The airline warns unprecedented state aid levels would prevent a level playing field “for many years” across the continent, disadvantaging “well-run” airlines not in receipt of such support.
It claimed such state aid would enable rival airlines to maintain prices below cost levels for months after the crisis had passed.
Ryanair expects a recovery in passenger levels and prices to take at least two years, by summer 2022 at the earliest. It expects a net loss of more than €100m (£87.2m, $109.5m) in the first quarter and further losses in the second quarter, its peak summer season.
Other staff will face unpaid leave and pay cuts of up to 20% as the airline looks to save cash. But the statement said Ryanair had entered the crisis with almost €4bn in cash.
The bleak tone of the announcement appeared to disappoint investors’ expectations, sending Ryanair shares down 3.6% in early trading in London on Friday.
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