7-May-2021 5:26 AM

SWISS announced major restructuring in response to structural market changes

SWISS stated (06-May-2021) that given the "continuing global coronavirus pandemic and the resulting structural changes in its markets" the carrier has concluded a restructuring "now seems unavoidable". SWISS projects a 20% structural decrease in overall demand in the medium term. In response to this, the carrier is initiating the 'realCH' strategic programme, with the following major adjustments:

  • Fleet to be downsized by "projected" 15% compared to a 2019 baseline. Short and medium haul fleet to be cut from 69 to 59 aircraft through the withdrawal of A320-family equipment and a reduction in wet lease operations. Long haul fleet to be cut from 31 to 26 aircraft, by withdrawing five of its long haul Airbus aircraft;
  • In line with the forecast reduction in demand, operating frequencies are "likely to be reduced from their 2019 levels" on both short and medium haul and long haul routes. In addition, services "may not yet be restored at all on a few direct intercontinental routes";
  • Workforce reduction of around 1700 full time positions, totalling more than 20% of total positions. The reduction could include forced dismissals for up to 780 ground and flying personnel, including around 200 ground personnel, 60 at SWISS Technics, 400 cabin personnel and 120 cockpit personnel. SWISS has initiated a consultation procedure to find solutions that are as socially responsible as possible, in collaboration with its employees and its social partners. By the end of 2021, the carrier plans to have eliminated around 1000 positions;
  • Corporate resizing and transformation intended to achieve "sustainable overall cost savings" of CHF500 million (EUR456.7 million);
  • Despite the restructuring, all stipulations of the Swiss Confederation in connection with bank loan guarantees will continue to be met. The carrier intends to repay its bank loans as promptly as possible and to "sustainably retain" its competitive credentials and regain its ability to invest. SWISS will also continue to pursue its premium positioning, maintain its operations from both Zurich and Geneva and "ensure that Switzerland remains connected with the world". [more - original PR]

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