EVA Airways Corp (長榮航空), Taiwan's second largest carrier, announced yesterday that it will reduce flights and cut jobs in the face of a bleak aviation environment.
"From Oct. 1, we will begin to reduce 17 flights every week between Taiwan and the US and between Taiwan and Southeast Asia," said EVA spokesman Nieh Kuo-wei (聶國偉).
As for job cuts, Nieh said that EVA Airways will make necessary job adjustments required by the planned flight reductions.
"We had earlier this year already begun to streamline our workforce. But in view of the negative impacts following the terrorist attacks on the US, the company has decided to speed up the task of lowering costs and enhancing competitiveness," Nieh said.
Nieh declined to say the number of jobs the airline would cut or in which areas the layoffs would be focused. Local Chinese-language media speculated yesterday that the layoffs would probably not exceed 600 people.
EVA Airways in early September reported a loss of NT$2.52 billion (US$73 million) for the first half of the year, compared with a net income of NT$1.32 billion a year earlier. It also expects a full-year net loss of NT$3.35 billion as a result of slowing business.
The Evergreen Marine Corp (長榮海運) has a 25 percent stake in EVA.
China Airlines Co (華航), the nation's largest carrier, said it is considering announcing its own flight reduction program within the next two weeks at the earliest, said company spokesman Paul Wang (王振畬).
"As passenger numbers have been falling, it is necessary to make flight adjustments for the industry," Wang said, adding they were working on a reduction plan.
But China Airlines has no plans to lay off employees provided that the company continues to make money, Wang said.
Wang denied a recent local media report that the company was considering cutting some 800 employees, saying that it's unreasonable for a company that is making money to lay people off.
Worldwide investors, however, are worried about the company's performance for this year and next.
US-based Goldman Sachs Group Inc on Thursday sharply lowered its net income forecasts for China Airlines to NT$32 million from NT$2.35 billion in 2001 and to NT$713 million from NT$3.42 billion in 2002, Chinese language media reported on Friday.
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