Aer Lingus shed 2,500 jobs

Aer Lingus is to shed 2,500 jobs, company workers were told today.

In a letter to the company’s staff, acting group chief executive Larry Stanley said: "The losses we face are truly staggering. They exceed anything we ever anticipated in Aer Lingus and right now it is survival that is our challenge."

Unions had expected huge job losses when bookings plummeted after September 11.

Transatlantic bookings fell 80% and the company is losing £2m every day.

Cash reserves are set to run out by the beginning of 2002.

Trade union financial experts are scrutinising the state of the books at the national airliner, after management disclosed details to them.

The company says it must save £90m of payroll costs, which translates into the loss of 2,500 full-time jobs.

Under a new viability plan for the airline, saving costs of £130m are called for each year, workers were told.

The plan will be finalised and presented to the government on Sunday.

Mr Stanley warned that the fleet reductions and 25% schedule, introduced after September 11, would continue into next summer.

He conceded there was little prospect of recovery in the short term.

"Before the tragic events of September 11 in the USA we were facing severe problems," Mr Stanley wrote.

"The foot-and-mouth situation had hurt us and the downturn in the world economies compounded things. The fall off in business traffic, in particular, had a severe impact on what is the most profitable part or our business."

Public enterprise minister Mary O’Rourke is set to address the Dáil over the crisis later this afternoon.