With cost cutting ruling the roost in the airline industry
in Europe and Americas, it is clear that certain major players might not be all
that well financially. Delta Airlines of US and Air France of France have
recently announced job cuts to ensure that they remain viable. While Delta has
been eyeing the top management positions and the salaried workers for meeting
this end, Air France is cutting the fat at the lower rungs of organization.
Delta has seen a sluggish growth in revenues with only 3 and
1 percent hikes in the first and second quarters of this year as compared to
last year. This has not been as per expectations and there has been a need to
cut down on the costs by job cutting of regulars. While there is not so much of
frenzy with this measure with Delta, the story has been different on the other
side of Atlantic.
Air France labor unions resorted to violent measures by
tearing off the shirts of two of Air France managers who had announced cutting
down of costs by job-cutting. It is notable that the mega airlines of Europe-
Lufthansa and Air France- have been battling the union strife for some years
now on a number of issues. With soaring competition from the Gulf carriers on
long haul flights and from low cost European carriers, the mega airlines of
yesteryears have been feeling the squeeze. When the corrections are sought to
be applied, it results in labor unrest. Recent strikes and violent methods have
dented the image of these carriers worldwide which has resulted in curtailing
of some routes, scaling down of operations and accumulating losses.
While the American airlines have been able to do a balancing
act with cooperation from the unions and some deft handling of situation by top
management, the same has not been seen in case of Europe.
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