With international travel virtually non-existent, Qatar Airways has a tough situation to manage: with no domestic routes, its only source of passenger revenue was cut short. While the airline has been particularly active in helping governments repatriate their stranded citizens, changes had to be made, as its international schedule was reduced to the bone. The airline now plans to cut jobs in order to weather the turbulence.
Qatar Airways’ Akbar Al Baker, the chief executive officer, indicated that the carrier is forced to face “a new reality,” as borders are closed, which renders many of the airline’s “destinations closed and aircraft grounded,” he added. There is no “foreseeable outlook for immediate, positive change,” indicated Al Baker.
Thus, the already loss-making state-owned Qatar Airways cannot keep the current amount of jobs, thus the company needs “to make a substantial number of jobs redundant.”
Redundant employees would still be paid their contractual dues and any unpaid overtime. If they are unable to return to their home countries due to travel restrictions, the airline would provide housing and a living allowance until the aforementioned restrictions are lifted.
Even before the breakout of the coronacrisis, Qatar Airways exhibited signs of struggle – affected by a blockade, the airline lost many profitable routes and was forced to avoid the airspace of many of its neighbors. This resulted in an FY2019 net loss of $639 million (QAR2.3 billion).
The company already warned at the end of March 2020 that it was running out of cash and that it would seek support from the Qatari government, the owner of Qatar Airways Group.