FILE PHOTO: The logo of Airbus is pictured at the entrance of the Airbus facility in Bouguenais, near Nantes, France, July 2, 2020. REUTERS/Stephane Mahe/File Photo
TOULOUSE, France (Reuters) – Major French unions on Monday signed a keenly awaited labor deal with Europe’s Airbus <EADSY> covering job reductions and furloughs for production workers affected by coronavirus-blighted demand for passenger jets.
After three months of talks, unions representing a majority of the planemaker’s French workers signed an agreement paving the way for 4,200 job reductions in France, including 3,400 in Toulouse, Europe’s aerospace capital where Airbus is based.
Unions say the agreement will prevent compulsory redundancies, although Chief Executive Guillaume Faury recently warned staff that voluntary measures would not be enough.
LONDON (Reuters) – Airbus <AIR.PA> will furlough around 3,200 staff at its Broughton factory in Wales, the European planemaker said on Monday after it warned staff that the coronavirus crisis had put its survival at stake.
Airbus has given its starkest assessment yet of damage from the crisis, telling the company’s 135,000 employees to brace for potentially deeper job cuts as it grapples with the impact of the COVID-19 pandemic on the aerospace sector.
Earlier this month, the group said it would furlough some 3,000 French workers by tapping a government-backed scheme for four weeks.
“Airbus confirms it has agreed with its social partners to apply the government’s Job Retention Scheme for approximately 3,200 production and production-support employees at its commercial aircraft site in Broughton,” it said in a statement.
Britain’s job retention scheme allows employers to furlough staff and claim cash grants up to 80% of wages, capped at 2,500 pounds per worker.
Airbus will top up gross salaries to bring pay up to 85-90% of pay, in accordance with an agreement signed with trade union representatives.
The deal affects the majority of the production and production support teams in Broughton, the north Wales factory which assembles wings.
Furlough periods will be staggered, with all starting in the next three weeks and lasting for at least three weeks.
The move does not affect Airbus’ 3,000 staff in Filton, western England, where wings are designed and supported.
(Reporting by Alistair Smout; editing by Stephen Addison)
OSLO (Reuters) – Norwegian Air <NAS.OL> could run out of cash by mid-May unless its proposed financial rescue plan is approved by creditors and shareholders, the budget carrier warned on Monday.
If approved by bondholders, leasing companies and shareholders, the plan may help Norwegian survive the coronavirus outbreak, which has grounded 95% of its fleet, leaving just 7 aircraft in operation.
But the planned debt-to-equity swap will hand majority ownership of 53.1% to the company’s lessors, while bondholders would own 41.7%, leaving current shareholders with just 5.2%, it said.
The move would allow Norwegian to tap government guarantees of 2.7 billion crowns ($255 million), which are dependent on the company reducing its ratio of debt to equity, and which would come on top of 300 million crowns it has already received.
It is “critical to get access to the state aid package by mid-May before the company runs out of cash,” Norwegian said in a presentation to investors.
Rapid growth has made Norwegian Europe’s third-largest low-cost airline and the biggest foreign carrier serving New York and other major U.S. cities, but with the expansion came debts and liabilities of close to $8 billion by the end of 2019.
Last week, the company reported that four Swedish and Danish subsidiaries had filed for bankruptcy and that it had ended staffing contracts in Europe and the United States, putting some 4,700 jobs at risk.
Norwegian’s shares opened 8% lower on Monday and are down 86% year-to-date.
The company aims to gradually emerge from the COVID-19 crisis with both a short-haul and long-haul network in place, and is targeting a return to normal operations in 2022, it said.
The plan requires backing from bondholders in each of four separate votes planned for April 30, from shareholders in an extraordinary general meeting scheduled for May 4, and from leasing firms.
It maintained plans to raise up to 400 million crowns in cash from owners.
(Editing by Jan Harvey)
FILE PHOTO: A Norwegian Air plane is refuelled at Oslo Gardermoen airport
In his letter, Haji-Ioannou has also called for removal of easyJet’s Chief Finaicial Officer Andrew Findlay, after earlier calling for a board meeting on a vote to remove Andreas Bierwirth as a director, which was rejected by easyJet.
“If this 4.5 billion pound liability to Airbus is preserved – and not cancelled – by the easyJet board then, I regret to report, easyJet will run out of money around August 2020, perhaps even earlier,” the founder said in his letter.
“I will certainly not be throwing good money after bad. For the avoidance of doubt, I will not inject any fresh equity in easyJet whilst the Airbus liability is in place.”
He also stated that he will continue to call for the removal of more directors every time the company delays the vote.
He also wants easyJet to reduce its fleet size to 250 aircraft from 350, adding that the airline will not need any more additional new planes for many years to come.
(Reporting by Juby Babu in Bengaluru; editing by Diane Craft)
LONDON, March 31 (Reuters) – British Airways said it is temporarily suspending flights from Gatwick Airport in southern England, Britain’s second busiest airport, due to the coronavirus.
BA’s boss warned earlier in March that the airline was in a battle for survival and would have to cut jobs and park planes.
“Due to the considerable restrictions and challenging market environment, like many other airlines, we will temporarily suspend our flying schedule at Gatwick,” a BA spokesman said.
BA said it will contact affected customers. The airline continues to operate some flights from its main hub at Heathrow.
Parent company IAG said flying capacity would be down 75% in April and May.
Rival airline easyJet said on Monday that it had grounded its entire fleet.
Gatwick Airport said last week it would shut one of its two terminals on Wednesday.
WASHINGTON, Dec 9 (Reuters) – A former Boeing Co employee who warned of problems with 737 production will testify on Wednesday at a U.S. House hearing on the Federal Aviation Administration review of the grounded 737 MAX.
The aircraft has been grounded since March after two fatal crashes in five months killed 346 people. Federal officials say the FAA is not expected to authorize the plane to fly until January at the earliest.
Former Boeing employee Edward Pierson, who had worked as a senior operations manager in the flight test and evaluation unit, will testify before the U.S. House Transportation and Infrastructure Committee, the panel said in a notice.
Pierson’s concerns were referenced at an Oct. 30 hearing — though he had not been named previously.
“All my internal warning bells are going off and for the first time in my life, I’m sorry to say that I’m hesitant about putting my family on a Boeing airplane,” Pierson wrote to Boeing management in mid-2018 before the first crash, according to an email obtained by the committee. He warned “the alternative of rushing to build is far riskier.”
Boeing spokesman Gordon Johndroe said Monday that “although Mr. Pierson did not provide specific information or detail about any particular defect or quality issue, Boeing took his concerns about 737 production disruption seriously.” He added that after Pierson retired and raised the issue again as recently as this year “those concerns received renewed scrutiny at the highest levels of the company.”
Johndroe added “the suggestion by Mr. Pierson of a link between his concerns and the recent MAX accidents is completely unfounded.”
Pierson could not immediately be reached on Monday.
Representative Albio Sires, a Democrat, on Oct. 30, questioned Boeing CEO Dennis Muilenburg about concerns raised by a Boeing employee about Boeing’s 737 production and his recommendation that production be halted. Sires said the employee wrote directly to Muilenburg in December 2018 after he had retired.
Johndroe confirmed Monday Pierson was the employee referenced by Sires.
“He raised some good concerns. We went back and took a look at his concerns and in some cases we identified areas where we thought his issues had already been addressed,” Muilenburg said at the hearing. Boeing did not slow production after Pierson’s concerns.
FAA Administrator Steve Dickson, FAA Aircraft Certification Service Executive Director Earl Lawrence and a member of the FAA’s Technical Advisory Board, Matt Kiefer, as well as former FAA employee G. Michael Collins will also testify.
(Reporting by David Shepardson; Editing by Dan Grebler and Lisa Shumaker)
MONTREAL/WINNIPEG (Reuters) – Canada’s longest railroad strike in a decade ended on Tuesday as Canadian National Railway Co reached a tentative agreement with workers, but shippers warned it could take weeks before service bounces back to normal.
Industry groups celebrated the end of the eight-day strike at the country’s biggest railroad, which had cost them sales and raised their expenses. News of the deal, which must still be ratified by union members, sent CN shares up by as much as 2%.
Thousands of unionized workers began heading back to their jobs, CN said, with operations expected to be in full swing on Wednesday. Union members should vote on the deal within eight weeks.
CN has rescinded 70 temporary layoff notices at an auto shipment terminal in Nova Scotia following the deal, another union said.
Canada relies on CN and Canadian Pacific Railway to move crops, oil, potash, coal and manufactured goods to ports and the United States.
Details of the agreement were not available but some 3,200 striking conductors and yard workers had been demanding improved working conditions, including rest breaks.
Prime Minister Justin Trudeau acknowledged CN and union officials in a tweet on Tuesday and thanked workers, industry and all Canadians for their patience.
Trudeau’s minority government had faced pressure from industry and farmers to end the strike and force workers back to their jobs.
Transport Minister Marc Garneau told reporters on Tuesday that if Ottawa had intervened with legislation, “we would not have had a solution today.”
Teamsters Canada President Francois Laporte noted the federal government “remained calm and focused.” CEO of Montreal-based CN J.J. Ruest thanked customers for their patience.
About half of Canada’s exports move by rail, according to industry data, and the strike would likely cost the Canadian economy less than C$1 billion ($750 million) and cut fourth-quarter growth by about 0.1 percentage point, Brian DePratto, a senior economist at TD, said.
PROPANE SHORTAGE TO PERSIST
The Canadian Propane Association warned severe shortages of the fuel in several eastern Canadian provinces could last weeks. “We need to get the inventory back up,” said association President Nathalie St-Pierre, noting the “crisis” was not over.
Garneau said CN will work quickly to clear the backlog, but added the process is complex and would take time.
Bob Masterson, chief executive of the Chemistry Industry Association of Canada, said some plants had slowed production during the strike.
Based on past rail disruptions, he said CN is likely to move critical commodities first, like propane for farms and homes and chlorine for drinking water, leaving other shippers to face delays.
PAIN FOR MINERS, FARMERS
Brendan Marshall, a vice president with the Mining Association of Canada, said miners faced hefty costs due to lost sales and plant disruptions. He said restoring normal operations could take a week for every day of disrupted service.
“Now we can hope that things can get back to normal in quick fashion. It’s cost a lot of money to farmers already,” said Markus Haerle, chairman of the Grain Farmers of Ontario. Wet conditions have stalled the harvest across much of Canada, including much of Haerle’s corn crop near St. Isidore, Ontario. Those crops must be dried before they can be sold, but the rail strike held up deliveries of propane, forcing farmers to use costlier alternatives.
(Reporting by Allison Lampert in Montreal and Rod Nickel in Winnipeg. Additional reporting by Kelsey Johnson in Ottawa, writing by Steve Scherer, editing by Louise Heavens, Steve Orlofsky and David Gregorio)
FILE PHOTO: Railcars stand idle at the CN railyards in Edmonton
