American Airlines plans to cut over 40k jobs due to covid induced downturn

American Airlines said on Tuesday that they will cut more than 40k jobs, including 19k through furloughs and layoffs, in October as it struggles with a sharp downturn in travel because of the pandemic.

American executives said the furloughs can only be avoided if the federal government gives airlines another $25 billion to help them cover labor costs for six more months.

The airline said 23.5k employees already have accepted buyouts, retired early or taken long-term leaves of absence, but that was not enough to avoid involuntary cuts. The furloughs of union workers and layoffs of management staff announced Tuesday will fall heaviest on flight attendants, with 8.1k being terminated in October.

American plans to fly less than half its usual schedule — and only one-fourth of its lucrative international service — in the fourth quarter. American Airlines began the year with almost 140k employees but expects fewer than 100k to remain in October. US air travel plunged 95% by April, a few weeks after the first significant coronavirus outbreaks in the United States.

The airline, based in Fort Worth, Texas, announced last week that it will pull out of 15 smaller US cities in October, a move that was seen as a warning shot to Washington that it should approve more money for airline payrolls.