Alitalia shedding 2,000 jobs in major cost-cutting exercise

With the Italian flag-carrying airline running at a purported loss of one million euros per day (US$1.07m), Alitalia’s 2017-2021 business plan has revealed the company’s board has approved the cutting of staff numbers by 2,000 by the end of 2019. This is based on a 50 percent reduction in office staff and 20 percent in non-flying roles. The reduction equates to a 16 percent reduction of the carrier’s 12,500 employees.
The cuts come as part of Alitalia’s efforts to reduce annual running costs by one billion euros (US$1.07bn) by the end of 2019 when it is hoped the carrier will become profitable. Thereafter the intention will be to add new aircraft to the existing fleet and, between 2019 and 2021, launch ten new long-haul routes which will also see the recruitment of 500 new crew members.
According to Cramer Ball, Alitalia CEO, “ Headcount reductions are a painful but necessary action… These changes are essential if we are to compete effectively in the extremely tough European aviation market.”
Alitalia has been hard hit by European low-cost carriers and has struggled to be a profitable airline despite Etihad taking up a 49 percent stake in the company in 2014 and the successful negotiation of a 500 million euro (US$535m) rescue package in 2013.