Cathay Pacific to lay off 286 U.S cabin crew staff

The airline industry has long been in a soup due to the novel coronavirus outbreak. But things got even worse for the sector post the governments imposing nationwide lockdowns and travel-bans. It is being predicted that if the lockdown gets extended any further, several budget carriers will have to file for bankruptcy.

In an attempt to sustain their businesses and prevent cash-burn, airline companies have now resorted to tough measures like sending employees on furloughs and cutting salaries.

Recently, Hong Kong’s flag carrier Cathay Pacific said that it will close its three cabin crew bases in the United States.

According to Reuters, the airline is reportedly laying off 286 staff as the coronavirus pandemic has virtually halted global travel.

The carrier has grounded most of its planes because of the fall in demand, flying only a skeleton network to major destinations such as Beijing, Los Angeles, Singapore, Sydney, Tokyo and Vancouver in April and May that represents just 3% of normal capacity.

In a statement, Cathay said it was communicating with the affected crew in New York, San Francisco and Los Angeles as well as their union.

Last month it announced the closure of its Vancouver cabin crew base, with 147 crew, as part of a business review.

On Thursday, Cathay said it was exploring all available options to ride out the storm and doing all it could to preserve cash. One day this week, it had carried just 302 passengers, compared to around 100,000 on a typical day.

The novel coronavirus pandemic has crippled the travel and airline industry forcing companies to run for their money and conserve as much capital as they can. This has led travel companies to resort to cost-cutting measures which sometimes include laying off employees to save cash burn.

Countries have entered a lockdown stage, where people are repeatedly being asked to not step out of their houses in an attempt to prevent community transmission of the virus.

According to a report by the International Labour Organization, it is being estimated that the pandemic will lead to a joblessness crisis worldwide. The UN agency estimated that more than 2.5 million people will lose their jobs and the pandemic will have a wider impact on the economy.

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