Israel’s El Al agrees to cut jobs to save $30 mln a year
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El Al Israel Airlines announced it agreed to trim its staff of flight attendants to save $30 million a year, as it negotiates a government bailout while flights have been grounded due to the coronavirus outbreak.
El Al, Israel’s flag carrier, and controlling shareholder Knafaim Holdings have been in talks with the Finance Ministry, which offered to back $250 million in bank loans but said El Al must issue $150 million in shares. The state said it would buy the shares, giving it a majority in the airline, if no one else did.
The ministry has demanded the cash-strapped airline slash spending as a key condition to receive state backing for a loan.
Under the deal with its union, El Al said it would reduce the number of permanent and temporary flight attendants as well as flight managers to save money and begin the recovery process.
Earlier this month El Al extended unpaid leave for 5,800 of its 6,500 workers until July 31 and said that without state aid it will not be able to resume operations once the country’s borders, shut over the coronavirus crisis, reopen.
Scheduled passenger flights have been halted until at least July 31, although El Al continues to operate cargo flights and occasional passenger flights.
