Virgin Atlantic has announced it will make more than 3,000
staff redundant in the UK and will cease operations from Gatwick airport as it
struggles with the financial impact of the coronavirus pandemic.
The airline, which employs about 10,000 people, said jobs
will be cut from across the business.
In a statement, Virgin Atlantic chief executive Shai Weiss
said: “We have weathered many storms since our first flight 36 years ago, but
none has been as devastating as Covid-19 and the associated loss of life and
livelihood for so many.
After 9/11 and the global financial crisis, we took similar
painful measures but fortunately many members of our team were back flying with
us within a couple of years. Depending on how long the pandemic lasts and the
period of time our planes are grounded for, hopefully the same will happen this
time.”
In addition to the job cuts, the airline is going to move
its flight operations from Gatwick to Heathrow but will keep its slots at the former
airport “so it can return in line with customer demand”.
The news comes after Virgin Atlantic’s rival British Airways
announced it would cut up to 12,000 jobs. A leaked internal memo from BA showed
it is also considering pulling routes from Gatwick. Other airlines that have announced plans to reduce staffing levels include Ryanair and SAS.
The British Airline Pilots Association called the
announcement a “terrible blow for the industry” and “evidence of the dire
situation facing UK aviation”.
General secretary Brian Strutton said: “Our members and all
staff in Virgin Atlantic will be shocked by the scale of this bombshell. We
will be challenging Virgin very hard to justify this.”
Oliver Richardson, national officer for civil air transport
at the Unite union, which represents Virgin Atlantic cabin crew and check-in
staff, commented: “The decision to make 3,150 staff redundant across Virgin’s
holiday and airline businesses is another devastating blow to the UK’s beleaguered
aviation industry. It is also premature, as the government’s job retention scheme
is still up and running and being fully utilised by the company.”
Meanwhile, Unite’s assistant general secretary Diana Holland
said: “There have been 18,000 job losses announced in the UK aviation sector in
the last week alone and this makes the case even more strongly that the
aviation industry-specific package Unite has constantly called for, and the
government has promised, must now be delivered.”
Virgin Atlantic is in the process of applying for commercial
loans from the UK government, with part-owner Sir Richard Branson at one point
saying he would offer his private Necker Island as collateral to save his
Virgin Group’s businesses.
Rheanna Norris, associate analyst at GlobalData, commented: “There
is a possibility that the Virgin brand could disappear from the global aviation
industry altogether. Virgin Australia is in voluntary administration, the
rebranding of UK airline Flybe to Virgin Connect was cancelled for obvious
reasons, and now Virgin Atlantic is asking for help.
“Major shareholder Delta has ruled out any further financial
aid due to EU law and the conditions of its own US government bailout. However,
Delta does not plan on amending its current investment. With its first loss
reported in five years, it is right to prioritise its own financial position
first.
“This should be a warning for the industry; with projections
that it could take two to three years to recover, this will not be the first –
or last – airline to go under due to Covid-19.”