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Virgin slashes 3,000 workers, axes Tigerair

·3-min read
A Virgin Australia Boeing 737-800 series aircraft on the runway at Sydney's main international airport, Kingsford Smith, on March 15, 2020 in Sydney, Australia.
A Virgin Australia Boeing 737-800 series aircraft at Sydney's main international airport, Kingsford Smith, on March 15, 2020 in Sydney, Australia. (Source: Getty)

Virgin Australia has announced it is slashing its workforce by a third, with 3,000 jobs to go under its new owner Bain Capital.

The plan to re-emerge from collapse also involves axing its budget airline Tigerair as domestic and international travel stalls amid the Covid-19 pandemic.

Virgin Australia group chief Paul Scurrah said the decision to cut roles involved “some very tough decisions”.

“We expect approximately 3,000 roles will be impacted as a result of the changes announced today,” he said.

“However, our intention is to secure approximately 6,000 jobs when the market recovers with aspirations for up to 8,000 in the future.”

Virgin also made the decision to axe its low-cost carrier, Tigerair Australia.

“The Tigerair brand will be discontinued in the market as there is not sufficient customer demand to support two carriers at this time,” Virgin said in a statement.

However, Tigerair will retain its air operator certificate to keep the option of operating a low-cost carrier in the future.

Virgin will double down on efforts to be the “best value carrier” in the market rather than a low-cost carrier.

The airline said it will remove ATR, Boeing 777, Airbus A330 and Tigerair Airbus A320 aircraft types.

The new measures were part of efforts to cut back costs, with the airline industry one of the hardest-hit sectors of the pandemic.

Scurrah thanked those leaving the business for their role in “making this a great airline”.

“They will be closely supported through our alumni program, have all their entitlements honoured and be provided with a two-year extension of employee travel benefits and early access to retiree and long service benefits.”

Demand for international and domestic tourism will take three years to return to pre-coronavirus levels, Scurrah added.

“Even when we do see a return to pre-COVID-19 levels of travel, successful airlines will be influenced by demand and look very different than the way they did previously, requiring long-term capital, a lower cost base and be more focused on providing exceptional experiences through a combination of great people and world class technologies,” he said.

“Working with Bain Capital, we will accelerate our plan to deliver a strong future in a challenging domestic and global aviation market.

“We believe that over time we can set the foundations to grow Virgin Australia again and re-employ many of the highly skilled Virgin Australia team.”

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