| Frank |
Oct 5th, 2001 12:03 PM |
Lez: This is what I found: <BR> <BR>Indicating massive job cuts, Public Enterprise Minister Mary O’Rourke warned yesterday that securing the future of Aer Lingus would require a major changes in the State airline. <BR> <BR>She said the company expected to make losses of £100 million in 2002 and £70m this year. Bookings on the transatlantic route, which provides 60% of the airline’s profits, were down 80% on last year, she said. <BR> <BR>In the fallout from the terrorist attacks on the US, the company is to implement additional cutbacks, including ending the Newark and Baltimore transatlantic services, which will reduce the cost base by a quarter. Overall the company’s operations will be cut by a quarter, resulting in the loss of anything up to 2,000 jobs. <BR> <BR>Mrs O’Rourke described the cash situation at the airline as very serious. Aer Lingus management estimate that even with the cost cuts the remaining cash reserves will only last until next January or February or even earlier, she said. <BR> <BR>Suggestions that the company has significant cash reserves were inaccurate, Mrs O’Rourke said. Aer Lingus reserves fell by £115m to £185m in just the last eight months. <BR> <BR>Currently waiting to hear full details of Aer Lingus’ restructuring plan, the Minister heads to the meeting of EU transport ministers in Luxembourg on October 16, to learn if the EU Commission will grant permission for state intervention. However, any intervention will be met with a legal challenge from Ryanair chief executive Michael O’Leary. He is a firm opponent of national airlines receiving government subvention, believing it gives them an unfair advantage over independents.
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