JAKARTA: Indonesia’s Lion Air Group is slashing 2,600 jobs as the coronavirus pandemic hammers Southeast Asia’s biggest carrier, a company spokesman said on Monday (Jul 6).
The layoffs – about 9 per cent of the airline’s 29,000 employees – would mainly affect contract workers, it said.
The job cuts come after Lion earlier reduced management and staff salaries.
“Lion Air Group is in a difficult and challenging period due to the effects of … COVID-19,” said Lion Air spokesman Danang Mandala Prihantoro.
“The tough decision is taken as a strategy to maintain business continuity, streamline the company’s operations, (and) to reduce expenses and restructure the organisation.”
Laid-off employees would be “prioritised” for rehiring if conditions improve, he added.
Lion, which operates several brands including Wings Air and Batik Air, is operating at between 10 and 15 per cent of its 1,400 to 1,600 daily flights before the pandemic, according to company data.
In April, Indonesia said it was banning all air and sea travel to halt the spread of COVID-19.
It later relaxed those restrictions, but Indonesia’s carriers have been hit as the outbreak hammers the global aviation industry.
Indonesia’s flight sector is on track for a 49 per cent passenger plunge and US$8.2 billion drop-off in revenue this year compared with 2019, the International Air Transport Association has estimated.