- Airbus to layoff 15,000 workers as it warns of a threat to its future due to COVID-19.
- The European aeroplane manufacturer seeks early retirements & voluntary departures.
- CEO reveals plans of keeping the company’s output down by 40% in the next two years.
Airbus SE (EPA: AIR) expressed plans of cutting around 15,000 jobs on Tuesday. The layoff, the company said, also includes 900 workers that it has already earmarked in Germany. The company attributed its decision to the Coronavirus pandemic that has so far infected more than 10 million people worldwide and caused over a quarter million deaths.
Shares of the company posted an about 2% intraday decline on Tuesday. At £58 per share, Airbus is currently more than 50% down year to date in the stock market after recovering from a low of £48 per share in March. Learn more about how do people make money in the stock market.
Airbus to layoff 1,700 workers in the United Kingdom
COVID-19 brought the demand for air travel to a near halt in recent months that pushed airlines into grounding fleets, slashing workforce, and deferring jets deliveries. Consequently, aeroplane manufacturers, including Airbus, took a massive hit. The European company now warns of a threat to its future due to the ongoing health crisis.
The layoff that was hinted at for weeks was finally detailed on Tuesday as the world’s largest aeroplane manufacturer announced plans of cutting 5,100 jobs in Germany, 5,000 in France, 1,700 in the United Kingdom, 900 in Spain, and 1,300 elsewhere that sum up to a total of 14,000. Airbus currently has a workforce of roughly 134,000 people worldwide.
Another 900 jobs, as per Airbus, will be laid off at one of its subsidiaries in Germany, Premium AEROTEC. In the UK, the job cut is expected to primarily affect its workers at Broughton (Wales) and Filton (Bristol) facilities.
Airbus seeks early retirements and voluntary departures
According to Airbus, the layoff will be implemented by summer 2021. The aggressive stance is subject to discussion with the unions which are committed to opposing compulsory redundancies. While Airbus did not rule them out, it said that it will prioritise early retirement and voluntary departures of its staff.
Previously, the European aeroplane manufacturer pledged to boost its revenues from services to £8.14 billion by 2030 versus more than £3.25 billion last year. Amidst the COVID-19 struggles, however, Airbus postponed its pursuit of the said target on Tuesday. CEO Guillaume Faury of Airbus also revealed plans of keeping the company’s output down by 40% in the next two years on Monday.
At the time of writing, Airbus has a market capitalisation of £45.59 billion.