Palma-based airline Spanair to cut jobs and routes

PALMA/MADRID/STOCKHOLM
BALEARIC union bosses held emergency talks yesterday afternoon and the Balearic government called for an urgent meeting with the central government in response to the announcement by the Palma-based airline Spanair that at least 250 local jobs are going to be lost as part of a restructuring plan to survive reduced consumer demand and rising fuel prices.

Spanair, Spain's second largest airline and 100 percent owned by Scandinavian operator SAS, said it is cutting as many as 1'100 jobs nationwide and dropping 15 aircraft from its fleet of 60 to make savings of around €90 million, $144 million, by the end of 2009.

Nine routes are also going to be axed but Balearic President Francesc Antich was quick to state yesterday that Spanair's Balearic flight operations will not be hit by the cut backs.

SAS, which last month abandoned a plan to sell Spanair, said in a statement “Spanair's management has announced today a feasibility plan to face the current crisis that the airline industry is going through as a consequence of the high fuel prices and the decrease of demand,” SAS said.

The carrier is to stop flying routes from Madrid to Vienna, Munich, Girona, Granada, Oviedo and San Sebastian, as well as Barcelona-Zurich, Bilbao-Malaga and Bilbao-Jerez.

Job losses are to be negotiated with unions over the next 10 weeks to determine how many redundancies will be voluntary and how posts will in future be shared by employees hired part-time. Job cuts will affect all levels, including management, pilots and flight crews, the airline said. “Spanair is capable of leading a strategy to regulate the excess capacity which afflicts the market while at the same time maintaining its position as the first Spanish airline operating out of Barcelona and the second major airline to fly from Madrid,“ Marcus Hedblom, Spanair director general said in the statement.

Spanair is the first airline in Spain to announce job, fleet and route cuts as the economy weakens in the wake of a real estate slump prompted by the subprime mortgage crisis in the United States. The Balearic government is already braced for an extra 10'000 jobs to be lost this winter.