Comair is cutting jobs as it restructures to survive the COVID-19 crisis that is forcing it to shut down operations for three weeks in line with a nationwide lock-down.
CEO Wrenelle Stander says the airline on Monday initiated a Section 189 retrenchment process in terms of the Labour Relations Act, adding: “Reducing our staff complement is a decision taken with great regret. We continue to pursue cost reduction measures across the group to mitigate the impact on our staff.”
Meanwhile, all Comair staff will be sent home on March 27 as the airline suspends all operations for both British Airways and kulula.com brands until April 19, in line with the three-week lockdown in SA.
“For the foreseeable future, our primary focus will be cash preservation,” Stander explained. “No resources will be deployed or cash spent unless it is to achieve one of the following three outcomes: cash preservation; a safe and reliable airline service; and/or planning for mitigating the impact of COVID-19.”
In February, the group reported an interim loss of R564m for the six months ending December, the first loss in its 74-year history. Stander says the results showed that while Comair’s revenue continued to grow at 3% in that period, it could not sustain the additional costs of 14% resulting from underperforming investments and significantly higher fleet and maintenance costs, which severely impacted the profitability of the group.
Stander refused to be drawn on the recent retrenchment of former joint-CEO and airlines division chief, Glenn Orsmond, except to say that Comair was “rightsizing the group and refreshing its executive team in an orderly and carefully considered process”. She said a small executive team continued to focus on the long-term sustainability of the airline.