Asiana Airlines extends furloughs indefinitely

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Asiana Airlines extends furloughs indefinitely

Korea’s second-largest airline has indefinitely extended mass furloughs of its employees, requiring more than 8,000 workers to take unpaid leave 15 days each month as the carrier struggles to stay financially afloat.

Asiana Airlines announced Sunday that it would require all staff to take at least 15 days of unpaid leave during the month of May, and every subsequent month “until business normalizes.” Last month, it announced the same policy for April.

In an industry with massive fixed costs such as leased planes and airport fees, airlines have been struggling to keep their employees on the payroll as the coronavirus pandemic wreaks havoc on international travel. The number of travelers using international flights in and out of Korea during the first week of April has plummeted by 97 percent on-year.

Domestic carriers face a combined 900 billion won ($740 million) per month in fixed costs, according to the Korea Civil Aviation Association.

Asiana, announcing initial furloughs in March, said the outbreak had left more than 70 percent of its workforce with nothing to do.

The airline has also attempted to make use of its empty passenger planes, operating chartered flights to transport Samsung and LG Display engineers from Van Don International Airport in Vietnam. In March and April, passenger planes embarked on 150 flights delivering air cargo to 15 countries, the company said.

The airline is far from the only ones suffering from a collapse in global travel as national governments have shut down borders or mandated self-quarantines for inbound travelers.

Korean Air, the largest air carrier in the country, has placed 70 percent of its employees on leave at reduced salaries through mid-October, and faces a 240-billion-won obligation in corporate bonds that mature this month. Low-cost carrier Eastar Jet, which in early March shut down all of its routes, recently said it would keep international flights grounded through late June.

The industry has set its sights on the Fifth Emergency Economic Council Meeting scheduled for this week, during which the government will announce measures to help companies and business sectors hurt by the new coronavirus. An earlier support plan provided nearly 300 billion won in bank loans and airport fee exemptions to low-cost carriers, but industry experts decried the plan as insufficient. The measures did not extend to larger companies like Asiana or Korean Air.

“Asking individual carriers to come up with a self-contingency plan first is the same thing as deciding to perform surgery after asking how much the patient can pay, Choi Hyun, the head of Korean Air’s labor union, said Tuesday during a press conference in front of the Blue House. “We need a treatment first. Asking for responsibility can come after.”

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