SIA asks pilots to take unpaid leave amid slowdown
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Singapore Airlines said on Friday it had asked its pilots to volunteer for unpaid leave for up to two years as it struggles with a slowdown in the aviation sector.
SIA's offer to pilots below the rank of captain comes after it last month said profits had fallen by more than half in the final quarter of 2011 due to rising fuel costs, and weakening passenger and cargo demand from Europe.
The call, which will allow the pilots to join SIA's rivals, was made to "help address a temporary surplus of senior first officers, first officers, second officers and cadet pilots," spokesman Nicholas Ionides told AFP.
He stated that SIA was 'not able to provide specific targets for how many pilots may take up the offer' as it was a voluntary scheme.
Despite the move, Ionides said SIA has no plans to reduce flights and downsize its operating fleet in the near term. The announcement comes as the global industry is hit by soaring fuel prices and low demand.
The International Air Transport Association in November cut its forecast for the sector's profits this year by a quarter to USD 3.5 billion, but warned of losses of more than USD 8 billion if the global economy suffers another downturn.
SIA announced net profit plunged 53 per cent year on year to Sg USD 135.2 million in the October-December quarter, while it said last week it would raise fuel surcharges by up to USD 28.
About half of SIA's 2,335 pilots were not of captain rank as of 31 March last year, SIA's 2010/2011 annual report stated.
"To the question of why we are offering the scheme, the global financial crisis in 2009-10 was a factor and resulted in some excess capacity at the time. Growth was also slower than anticipated after that," Ionides added.
"We view the resultant surplus pilot situation as temporary, and are therefore managing this by introducing the voluntary scheme."
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