TURBULENT WINTER FOR AIRLINES

PALMA
PALMA-BASED airline employees are in for a bumpy and uncertain ride this winter with a number of airlines introduce cost cutting restructuring programmes.

Spanish airlines Spanair and Futura, both with their headquarters here in Palma, Iberia, Air Nostrum, Air Europe, LTE, Vueling and Clickair, the German no frills carrier Air Berlin and Ireland's Ryanair are all planning to reduce capacity and flights this winter in an attempt to reduce costs which have been pushed up by rising fuel prices and extra airport taxes and security costs - not to mention a slight decline in demand for flights because of the credit crunch.

An estimated 3'000 employees in the Balearics, primarily here in Majorca, could be affected by the restructuring programmes which are expected to come into force next month.

Ryanair has already announced that its Palma operations are going to be temporarily stopped for two months while Spanair is going to lay off at least 700 people as part of a major cost cutting exercise and Futura International is also expected to introduce wage caps and also make between 200 and 300 people redundant. The others airlines have decided to reduce operations and their fleets or, as is the case with Air Europa, operating planes with a slightly reduced capacity.

Some, however, are looking at axing certain routes and reducing flight frequencies. easyJet is understood to be looking at some of its domestic Spanish routes such as its service between Palma and Oviedo in Asturias.

The cuts will also affect travellers.
There will be less flight availability over the winter and airfares will start to rise next month as the cost cutting operations are introduced.
But, it is not just here in Spain that airlines are struggling. Many small airlines in Europe are now struggling to cope with the escalating cost of fuel and Ryanair is said to have imposed a limit on their pilots' safety fuel reserves to save money.

Low-cost carriers are also contending with a slump in trade as customers tighten their belts to cope with the global economic downturn.