United expects to shrink its management and administrative ranks by at least 30% starting in October, according to a memo sent to employees Monday. That amounts to at least 3,450 people—the first indication of how many are likely to lose their jobs as United and other airlines grapple with a steep decline in air travel and an uncertain path to recovery. Airlines agreed not to lay off workers or cut pay rates through the end of September as a condition of receiving federal aid to cover salaries and benefits. United is receiving some $5b under that program. A United spokesman said the federal aid didn’t cover all the airline’s payroll expenses. “We anticipate spending billions of dollars more than we take in for the next several months, while continuing to employ 100% of our workforce. That’s not sustainable for any company,” he said. Employees affected by the reductions will be notified in mid-to-late July. United hasn’t said how many pilots, flight attendants, mechanics and other front-line employees it expects to cut or furlough. “Governmental restrictions on travel, stay-at-home orders, and the lack of a medical solution for COVID-19 have brought bookings and demand for travel basically to zero,” Kate Gebo, United’s executive VP of human resources, wrote in the memo to employees. “This is forcing us to come to terms with the fact that our airline—and our entire workforce—will have to be smaller than it is today.”<br/>
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A top executive at United is telling employees to consider leaving the company voluntarily as it grapples with the consequences of the coronavirus pandemic. In a memo to some United staffers, Greg Hart — the company's COO — said the airline will need to "right size" its workforce. "You may want to seriously consider if you're in a position to take a voluntary separation," Hart wrote. He added, "You, alone, can decide if a [Voluntary Separation Program] works for you and your family." Hart said executive salaries have been cut and that the airline is trying to be transparent with its rank-and-file workforce. "We recognize that this is painful news, but it provides what we believe is the most accurate assessment of what lies ahead for our company," he said. United announced last month that it was cutting its May and June schedule by about 90% of what was originally planned at the start of the year. The airline is precluded from laying off staff for the next six months under terms of a federal financial assistance package that will provide it with about $5b, though it is preparing to cut staff as soon as Oct. 1, according to an April letter sent to staff by CEO Oscar Munoz and President Scott Kirby.<br/>
Air Canada on Monday announced a billion-dollar loss and announced mandatory temperature checks for customers amid the coronavirus pandemic. “We’re now living through the darkest period ever in the history of commercial aviation, significantly worse than 9/11, SARS and the 2008 financial crisis,” CEO Calin Rovinescu said Monday. The US-Canada border remains closed to all nonessential travel. Since mid-March, the airline has slashed its flight schedule by more than 90% and grounded more than 200 aircraft, cutting service internationally to just five airports. The company burned C$22m Canadian in cash per day in March. Air Canada said it lost C$1.05b in Q1, compared with a profit of $345m in the same quarter last year as governments imposed travel restrictions around the world due to the COVID-19 pandemic. The airline said remaining flights will be subject to an infrared temperature check at all airports. It already requires customers to wear face coverings. <br/>
Passengers on Air Canada will have their temperature checked before boarding, receive hand sanitizer and enjoy more personal space in economy class under a new safety protocol. The program unveiled Monday aims to reduce the risk of exposure to Covid-19 and put travelers at ease, the company said. It adds to existing measures such as mandatory mask wearing, a safety questionnaire and cabin disinfection. The protocol “will provide travellers with the confidence that they can book and fly safely with Air Canada as they consider their travel plans in the current environment,” CEO Calin Rovinescu said, hours after the airline said it expects a slow recovery for the industry. Story lists key elements of the program, to be implemented by May 15.<br/>
Lufthansa’s talks with the German government over a multi-billion euro aid package are coming down to how much the state will profit over coming years for rescuing Europe’s biggest airline, people familiar with the matter said. While Lufthansa CEO Carsten Spohr said this weekend that negotiations are moving toward a conclusion, the sides are still haggling over financing terms, according to the people. Germany wants to be sure it emerges better than even from a bailout after losing money when rescuing banks following the 2008 financial rout. Lufthansa fears that will make it harder to weather a extended travel slump and compete with airlines that have received more generous terms for state assistance. Negotiations concern loans, credit guarantees and a state equity injection, split between shares with voting rights and a so-called silent participation limiting the government’s day-to-day say. Officials are pushing for a 9% guaranteed dividend for the latter, a figure the airline says is too high, the people said. An agreement is still expected to be in place in the next few days or early next week, they said. <br/>