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Emirates to Suspend of Passenger Operations Following Virus Outbreak
After multiple changes, Emirates has announced that it stop all passenger operations due to the COVID-19 Coronavirus. The Dubai-based carrier becomes the latest major airline to reduce flights following a global decline in passenger numbers.
From March 25, Emirates will operate its cargo flights with its Boeing 777F fleet. Passenger flights to a selection of countries will be suspended indefinitely. Because of this, the majority of employees will also face a reduction in basic pay.
Initially, the carrier announced a total cancelation of flights to come into effect from March 25. But due to requests from governments and customers Emirates then announced it will continue repatriation efforts of travelers: “Emirates will continue to operate passenger flights to the United Kingdom, Switzerland, Hong Kong, Thailand, Malaysia, Philippines, Japan, Singapore, South Korea, Australia, South Africa, the United States and Canada so long as borders remain open and there is the demand for flights to operate.”
Finally, the airline has announced the third amendment to its plans, this time confirming the full shutdown from March 25, as originally planned. In a statement released on the airline’s website on the morning of March 23, it said: “As per the UAE government’s directive, Emirates will temporarily suspend all passenger services for two weeks starting from 25 March 2020. We are very sorry for any inconvenience caused to our customers and travelers. These measures are in place to contain the spread of COVID-19, and we hope to resume services as soon as feasible.”
The state-owned airline has attempted to maintain passenger flights since the outbreak began and with its global network help travelers return home. Emirates operates roughly 3600 flights per week to over 150 destinations worldwide. It is the largest operator of Airbus A380 and Boeing 777-300(ER) aircraft in the world that add up to a fleet of around 260 airplanes.
This is part of a number of cost reduction measures taken by the airline as travel demand reduces. Others include freezing non-essential recruitment, encouraging employees to take leave during times of reduced flying and a temporary reduction of basic salary for the majority of Emirates group employees.
Along with the announcement regarding the reduction of flights, the airline informed employees how the decision will affect them. The majority of Emirates Group employees will take a reduction of between 25 percent to 50 percent of their basic salary for three months. However additional benefits such as housing and medical care will continue to be paid. The Presidents of Emirates and dnata (Dubai Airport ground operations company) Sir Tim Clark and Gary Chapman will take a 100 percent basic salary cut for three months. The pay reduction has been implemented so that the airline does not have to cut jobs.
An internal email revealed that Management, Flight Operations, Engineers and those on a salary Grade 9 or above will take a 50 percent basic salary reduction, while Grades 4 to 8 and flight attendants will lose 25 percent of their basic salary. Those on Grades 1 to 3, including Cabin Service Attendants, will have no reduction in basic pay.
Discretionary expenditure is being postponed or canceled, as is non-essential consultancy work. Emirates will also work with its suppliers to find cost savings and reach better efficiency.
Air cargo links will continue to be maintained by the airline which will be deploying its Boeing 777 freighters for the transport of essential goods including medical supplies.
This comes as dnata, part of The Emirates Group, announces it will be significantly reducing its operations as many of its airline customers are reducing or ceasing operations. This has also lead to the temporary closure of offices across its international network.
The Chairman and Chief Executive of Emirates Group, HH Sheikh Ahmed bin Saeed Al Maktoum, said: “Until January 2020, the Emirates Group was doing well against our current financial year targets. But COVID-19 has brought all that to a sudden and painful halt over the past 6 weeks.
“As a global network airline, we find ourselves in a situation where we cannot viably operate passenger services until countries re-open their borders, and travel confidence returns. By Wednesday 25 March, although we will still operate cargo flights that remain busy, Emirates will have temporarily suspended all its passenger operations. We continue to watch the situation closely, and as soon as things allow, we will reinstate our services.
“Emirates Group has a strong balance sheet and substantial cash liquidity, and we can, and will, with appropriate and timely action, survive through a prolonged period of reduced flight schedules, so that we are adequately prepared for the return to normality.” Sheikh Ahmed continued.
Emirates has already strongly discouraged its employees from non-essential travel and has implemented work from home policies for employees where feasible.
On the pay cuts, Sheikh Ahmed said: “Rather than ask employees to leave the business, we chose to implement a temporary basic salary cut as we want to protect our workforce and keep our talented and skilled people, as much as possible. We want to avoid cutting jobs. When demand picks up again, we also want to be able to quickly ramp up and resume services for our customers.”
“These are unprecedented times for the airline and travel industry, but we will get through it. Our business is taking a hit, but what matters, in the long run, is that we do the right thing for our customers, our employees, and the communities we serve. With the support and unity that we have seen from our employees, partners, customers, and other stakeholders, I’m confident that Emirates can tackle this challenge and come out stronger.” Sheikh Ahmed added.
This article was updated on Monday, March 23 at 4:00 a.m. ET due to new information given by the airline.
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