Airbus warns staff it is ‘bleeding cash’
Jobs at risk and shake-up looms as 3,200 furloughed
THOUSANDS of UK jobs could be at risk after Airbus warned it is ‘ bleeding cash’ and may not survive the coronavirus crisis.
Chief executive Guillaume Faury, pictured, told the plane maker’s 135,000 staff to brace for a major shake-up and potentially sweeping job cuts to slash costs.
The stark warning throws into doubt the future of the firm’s 13,500strong workforce in the UK, where it makes the wings for its jets.
Airbus said yesterday it will apply to the Government’s job retention scheme to furlough 3,200 workers, or more than half the staff, at its Broughton site in North Wales where it assembles aircraft wings.
It is understood the furlough periods would be staggered and last for at least three weeks.
It is also expected to top up staff salaries between 85pc to 90pc.
Faury told staff in a letter: ‘ We’re bleeding cash at an unprecedented speed, which may threaten the very existence of our company. We must now act urgently to reduce our cash debt, restore our financial balance and, ultimately, to regain control of our destiny.’
The European manufacturer announced weeks ago it would slash the number of planes it produces by a third. Widespread travel restrictions to contain the coronavirus pandemic have grounded hundreds of thousands of flights and wreaked havoc on global airlines. It has also virtually eliminated the need for new aircraft – with airlines such as Easyjet scrabbling to renegotiate orders so that they can save their own cash.
Faury said: ‘In just a couple of weeks we have lost roughly onethird of our business. And, frankly, that’s not even the worstcase scenario we could face.’
Although analysts have mostly spoken of the pandemic triggering a downturn that would last between three to four years, Airbus is also considering more painful scenarios where demand for its jets would only return after five to 10 years.
Airbus has started to use governmentsupported schemes, such as furloughing 3,000 employees in France, and is thought to be in talks for other financial support such as stateguaranteed loans.
It is understood it will seek to furlough staff in the UK, but it is unclear how many staff this would cover.
But Faury said Airbus ‘ may now need to plan for more farreaching measures’ than furloughing and is exploring ‘ all options’ as it waits to see how much demand there will be. Airbus is expected to reveal more details tomorrow as it releases its first-quarter results.
Trade union Unite said Faury’s warning ‘must serve as a wake-up call’ to the UK and other European governments that the aviation sector will need support.
Although it has operations in the UK it is headquartered in Toulouse and its largest shareholders are the French, German and Spanish governments.
Unite’s national officer for aerospace, Rhys McCarthy, said: ‘Government support to the aviation industry must include strict conditions that include the retention of current orders and the mothballing of older planes for newer, more efficient aircraft and engines.
‘A do-nothing approach will not only threaten tens of thousands of jobs, but make an economic recovery that more difficult and will result in the UK forfeiting its leading role in aerospace.’