Lion Air Group to reportedly furlough about 8,000 staff

Lion Air Group intends to furlough between 25% to 35% of its 23,000 employees, according to Reuters, which amounts to around 8,000 individuals. This comes as the airline had to reduce its operations as a result of COVID-19 restrictions. The Indonesian-headquartered group operates Lion Air, Batik Air and Wings Air.

Quoting the group, Reuters reported that the decision was made to maintain the business's and company's sustainability, streamline its operations, reduce costs and restructure the organisation. The reason being operational conditions in the aviation industry have yet to return to normal as a result of the pandemic's impact. Additionally, the group also decreased its operation to between 10% to 15% of its 1,400 flights per day. MARKETING-INTERACTIVE has reached out to Lion Air Group for comment.

Lion Air Group is not the only airline to have fallen victim to the COVID-19 pandemic. Singapore Airlines (SIA), Malaysia Airlines (MAB), AirAsia, and Hong Kong Airlines have also battled the impact of the pandemic. Last September, SIA Group cut around 4,3000 positions across its airlines. After taking into account a recruitment freeze, natural attrition, and the take up of voluntary departure schemes, Singapore's national carrier said previously that the potential number of staff impacted will be reduced to about 2,400 in Singapore and in overseas stations. It froze recruitment in March last year and also opened vacancies that were unfilled.

Meanwhile, MAB also embarked on an "urgent restructuring exercise" last year, undergoing a comprehensive restructuring of all the Malaysia Aviation Group business and capital structure. Since March 2020, MAB has undertaken cost-cutting measures and conserved cash through measures such as extensive salary cuts for the entire management team and pilots, introducing no-pay leave, seeking payment deferrals, and renegotiating contracts, among others in order to survive and protect as many jobs as possible.

At the same time, AirAsia also reportedly cut 10% of its 24,000 employees last year and could only fly 80 out of 245 planes last year as a result of the pandemic. Group CEO Tony Fernandes said previously that the 10% job cuts are "far less than most airlines". Meanwhile in June this year, Hong Kong Airlines underwent another round of job cuts, with nearly two-thirds of its employees being made redundant or being required to take a significant pay cut to keep their jobs. The HNA Group-owned airline said about 700 Hong Kong-based and overseas employees were impacted.