No layoffs for China Airlines thanks to cargo operations - Норд Коннект
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No layoffs for China Airlines thanks to cargo operations

The Chairman Hsieh Shih-Chien of China Airlines said today in the shareholders meeting that the salary and work hour reduction due to the impact of COVID-19 will end by July. The flag-carrier from Taiwan currently only operates around 200 passenger flights a month, which is a significant drop compared with 200 flights a day before the pandemic. The implementation rate is about 3 — 4% only. The airline’s overall revenue from passenger operations in April and May has fallen from NTD 8-9 billion (around USD 300 million) to only NTD 300-500 million (around USD 16 million).

But even so, Hsieh said that the company still does not consider layoffs. The company had negotiated with the union on salary and work shift reduction from May to July, with the goal of keeping all the employees. For general employees, the pay was reduced by 15%, and the supervisor was decreased by 20%. The senior supervisor had a 25% cut. «This situation will end in July,» he further commented.

On the other hand, cargo operations have been a life-saving straw for the company. It currently has a fleet of 18 freighters, which helped to generate more than NTD 7 billion (USD 236 million) and NTD 9 billion (USD 300 million) for April and May, respectively. It is the main contribution to the cash flow now and also a factor supporting the airline’s non-layoffs goal.

During the pandemic, the Taiwan government had donated medical supplies to several countries with the help of its flag-carrier. However, the name China Airlines was frequently mistaken for Air China, the mainland’s national carrier, which prompts Taiwanese petitioners and a group of lawmakers to demand the renaming of the airline.

The question was also brought up in the meeting, but Hsieh said it has not yet entered the board discussion.