Internal Aer Lingus report outlines €60m in cuts

Political reaction: Fianna Fáil calls for suspension of Dáil vote on sale of stake in airline

An internal analysis commissioned by Aer Lingus has maintained nearly €60 million in additional cost savings could be generated at the company.

The airline has strongly denied the presentation of the assessment made to its management a month ago by outside consultants represents a secret blueprint for job cuts.

Trade unions and Opposition TDs opposed to the sale of the Government's stake in the airline said the revelation of the internal assessment backs up their fears that the takeover of Aer Lingus by International Airlines Group (IAG) could lead to significant job losses.

The report by consultants Nyras examined Aer Lingus in a number of areas on a "like with like" basis with low-cost carriers Easyjet and Vueling.

READ MORE

It recommended that while Aer Lingus could not achieve the cost base of low-cost airlines, it should set “aggressive but achievable targets” for short-haul efficiency at a minimum of €60 million.

‘Job losses’

IAG chief executive Willie Walsh confirmed jobs would be lost if the group takes over Aer Lingus. “I have been very clear. I have been honest. There will be duplications that will result in job losses.”

He also said Aer Lingus management would deal directly with trade unions.

The unions are demanding there be no compulsory redundancies.

Fianna Fáil transport spokesman Timmy Dooley called for Thursday's Dáil vote on the proposed sale of the Government's stake to be suspended until the report is debated.

Mr Dooley, a Clare deputy, said the report “compares the airline’s cost base to a range of low-cost airlines and sets out cost reduction strategies that would directly impact jobs at the airline”.

Analysis

An Aer Lingus spokesman said the ongoing benchmarking analysis looked largely at costs incurred through purchasing third-party services and had no bearing on employment in Aer Lingus.

He said the assessment in relation to pilots and cabin crew compared efficiencies in Aer Lingus to those in comparable airlines. He said the real picture in relation to employment was that the airline would generate 635 jobs by 2020 on foot of a takeover by IAG.

Siptu construction and utilities division organiser Owen Reidy said: "This revelation would seem to confirm the worst fears of Aer Lingus staff that a takeover by IAG will mean major job losses."

Martin Wall

Martin Wall

Martin Wall is Washington Correspondent of The Irish Times. He was previously industry correspondent