July 3 (UPI) -- Air France said Friday it will cut 7,580 jobs by the end of 2022, citing 95 percent drop in revenue during the past three months and an uncertain future.
The company said it was losing about $16.9 million a day at the height of the COVID-19 crisis, and didn't expect business to return to pre-pandemic levels before 2024.
The cuts will include about 6,560 Air France jobs, or about 16 percent of the current 41,000, along with 1,020 jobs at its HOP! subsidiary, which currently employs 2,420. Almost half of the job cuts -- about 3,500 -- are expected to be eliminated through attrition.
The company said guaranteed loans from the French government, amounting to almost $7.9 billion, would help it survive in the short term, but that is transformation was necessary to remain sustainable.
"In the context of such a lasting decline in activity, the Air France Group must act with lucidity and responsibility," the company said in a statement. "Its transformation is mainly based on changing its domestic business model, reorganizing its support functions and continuing to reduce its external and internal costs."
The International Air Transportation Association estimates that the global airline industry is on track to lose $84 billion this year. Passenger demand improved slightly in May, with a 91.3 percent drop compared with the previous year, compared with a 94 percent annual decline reported in April.
In the United States, American Airlines and four other carriers signed an agreement for $25 billion in federal loans through the Coronavirus Aid Relief and Economic Security (CARES) Act.
