CHICAGO/WASHINGTON (Reuters) – Southwest Airlines <LUV.N> has received interest from 28% of its workers for extended leave or exit deals, Chief Executive Gary Kelly told employees on Monday, while Delta Air Lines <DAL.N> said it was reviewing its pilot staffing after 2,234 bids for early retirement.
Airlines have warned they must shrink due to the coronavirus pandemic and are encouraging employees to accept voluntary departure deals in the hope of avoiding involuntary furloughs in the fall, when $25 billion in government bailout funds run out.
Southwest, with around 60,900 employees in 2019, said it would accept applications from 4,400 for early retirement and evaluate nearly 12,500 requests for extended time off packages.
One person who reviewed the numbers said they represented around 24% of Southwest pilots and 33% of flight attendants.
Meanwhile, Delta spokesman Michael Thomas said early retirement bids from 2,234 pilots before a Sunday deadline was “meaningful progress as we look to mitigate furloughs.” The company is working to determine next steps and its overall pilot staffing outlook, he said.
Last month Delta sent furlough warnings to around 2,500 pilots, though airlines are generally reluctant to lose pilots because of the timely and costly training needed to bring them back.
If a COVID-19 vaccine is developed and demand returns, airlines want to respond quickly. But for now, many have warned that bookings that began to rise in May and June from dramatic lows in April have leveled off or even fallen due to a rise in COVID-19 cases in some parts of the country.
U.S. airline shares lost 3.4% by midday on Monday. <.DJUSAR>
American Airlines <AAL.O> and United Airlines <UAL.O> have also offered voluntary departure deals while together sending more than 60,000 warnings of potential furloughs to their employees, even as discussions heat up in Washington for a new round of government bailouts.
United, American and Southwest each publish quarterly results this week.
(Reporting by Tracy Rucinski and David Shepardson; Editing by Dan Grebler)
