American, United Plan Executive Cuts Amidst ‘Tough Times’

By Kurt Stolz on 30 May 2020
  • Share

American Airlines planes in Miami

American Airlines and United Airlines – the two largest carriers in the United States by fleet size – announced significant cuts to their respective managerial ranks as demand for travel hovers close to zero as a result of the coronavirus outbreak.

United said Friday it would cut 13 of its 67 senior-level executive positions in the company.  The airline’s new CEO, Scott Kirby, said in a memorandum to employees last week that there were “tough times ahead.”

“Our costs are not designed for the near-term uncertainty of travel demand. Demand could be down 30% or it could be down 70%,” Kirby wrote in the memo.

Meanwhile, American Airlines, the world’s largest airline, will apparently cut managerial and administrative staff by some 30% according to an internal memorandum from Elise Eberwein, the airline’s executive vice president of people, which was viewed by Frequent Business Traveler.

Although American Airlines received federal financial assistance to help lessen the blow from the coronavirus, “we need to reduce our cost structure, including our most significant expense — the cost of compensation and benefits,” Elise Eberwein, American’s executive vice president of people and global engagement, said in an email to employees. “And we must plan for operating a smaller airline for the foreseeable future.”

Eberwein wrote that, despite government aid to help stabilize the company during the pandemic, “we need to reduce our cost structure, including our most significant expense – the cost of compensation and benefits,” adding that “we must plan for operating a smaller airline for the foreseeable future.”

(Photo: Accura Media Group)

Accura News

Read previous post:
Coronavirus News from Across the Globe: May 30, 2020 – Spike in Israel, Canada Extends Cruise Ship Ban

05-30 In Los Angeles, barber shops and hair salons will be able to reopen, said  Los Angeles County Supervisor Kathryn...

Close