SIA took this decision in light of the uncertainty that currently looms over the aviation industry, impeded by the ongoing COVID-19 crisis’s effects, the airline group’s statement read on September 10, 2020.
However, the effects of layoffs that are set to affect Singapore Airlines (SIA1) (SINGY), SilkAir and Scoot, have reportedly been mitigated by retirement schemes and voluntary leaves. The Group said that these measures allowed it to eliminate 1,900 job positions throughout the company’s COVID-19 period. This means that 2,400 employees will end up losing their jobs involuntarily within the Group’s global operations.
The Group reportedly expects to continue its services under 50% of passenger capacity until the end of FY2020. SIA further quotes 2024 as the most likely year when the company could expect the return to previous traffic level – a prediction in line with authorities such as IATA and ACI.
The airline group expects domestic markets to be the first to improve, a phenomenon that was already recorded in China. However, the airline group commented that as it“does not have a domestic market that will be the first to see a recovery,” SIA is left in a vulnerable position.
SIA has reportedly lost $1.1 billion in Q1, 2020, while the group’s revenue was dominated by cargo after converting 33 passenger aircraft into air freighters.