Delta Air Lines CEO Ed Bastian says the airline might not have to lay off workers despite the low travel demand and financial challenges caused by coronavirus pandemic.
Reason why the carrier won’t be laying off workers
Bastian said more than 17,000 employees, or about 20% of Delta’s 90,000 employees, have accepted early retirement offers and thousands more have agreed to voluntary unpaid leave in the fall as the airline shrinks to cope with decimated travel demand.
“I think we have a shot at that, remarkably enough, given how low our revenues are,” Bastian said in an interview with CNBC on Tuesday.
“I’m optimistic if we do have a furlough, it’s going to be relatively minimal numbers.”
Bastian’s optimism about layoffs comes as Delta reported what Bastian called the worst financial results in the airline’s history as passenger counts plunged 93%. The airline brought in just $1.5 billion in revenue in the April-June quarter, versus $12.5 billion in the same period a year ago. It posted a net loss of $5.7 billion, compared with a profit of $1.4 billion a year ago. It is the first major airline to report results for the quarter.
Bastian further said, he thinks the worst is behind Delta even though bookings have begun to stall due to a surge in coronavirus cases in the Sun Belt and new quarantine measures.
“We’re not going backwards,” he said.
The airline planned to add 1,000 daily flights to its schedule in August, on top of 1,000 flights this month, but has now sliced that in half due to weakening demand. Even with the additions, the airline is only operating at 25% capacity this summer..