SWISS to lay off up to 780 staff and reduce fleet

The Covid-19 outbreak has hit airports and airlines hard. © Keystone / Christian Beutler

Swiss International Air Lines (SWISS) is cutting hundreds of jobs and downsizing its fleets as the company struggles to weather the disruption of Covid-19.

Up to 780 employees – including pilots, cabin crew, ground crew, and technicians – could be affected by the layoffs, SWISS announced on Thursday.

The company’s fleet of short- and medium-haul planes will be reduced by ten to 59, and long-haul aircraft by five to 26 – a total reduction of 15% of fleet size compared to 2019.

As a result, short- and medium-haul flights are “likely to be reduced from their 2019 levels, while services may not yet be restored at all on a few direct intercontinental routes”, the airline wrote in a statement.

SWISS had already reported plummeting finances and had hinted at reducing up to 1,000 staff, but without layoffs. The Covid-19 pandemic, which brought international travel to a halt in 2020, has been a disaster for the airline.

Now, however, the company cites “structural” changes in the airline market which it reckons will result in a decline of 20% in overall demand in the medium-term future.

“It has grown increasingly clear that our market is undergoing structural change, and that despite the actions which we were swift to take in response [to the pandemic], a restructuring of our company now sadly seems unavoidable,” said SWISS CEO Dieter Vranckx in a statement.

Vranckx, who replaced former CEO Thomas Klühr at the end of last year, said the new measures aim to make savings of some CHF500 million ($550 million), which would allow the company to “repay our bank loans as promptly as possible and to sustainably retain our competitive credentials and regain our ability to invest”.

SWISS said none of the measures would have an impact on its obligations under the terms of a government-backed financial aid package made just over a year ago, when the country’s airline sector was supported with almost CHF2 billion in liquidity.

A consultation process has been initiated with social partners to try to find the best terms on which to proceed. The talks are set to wrap up by mid-June, SWISS said.

The public services union (SSP-VPODExternal link) is pressuring SWISS to reconsider what it perceives as a high-risk strategy; the union points to recent studies that forecast more positive scenarios for air traffic, including a return to pre-pandemic levels by the end of 2021.