United Airlines warns it may furlough a third of its pilots

(Bloomberg)—United Airlines Holdings Inc. warned that it’s considering furloughs for as many as one-third of its nearly 12,000 pilots, citing a resurgence in U.S. coronavirus cases that’s weakened sales.

“In recent weeks, bookings have stalled and we continue to see an impact of the recent increase in Covid-19 cases on our business,” Bryan Quigley, senior vice president of flight operations, wrote Thursday in a memo to United pilots.

United’s planning for a further “significant reduction in business” would drive 3,900 pilot furloughs, “and that may not prove to be enough,” Quigley wrote.

United had planned to furlough 2,250 pilots this year—a number that was expected to be reduced by voluntary leave programs and an early-separation package offered to the carrier’s most senior pilots. Instead, the number could almost double as the virus rages in many parts of the U.S.

“Because Covid-19 cases continue, and demand improvement remains very slow, we may need to furlough more pilots in 2020, and in 2021, than originally planned,” Quigley wrote. The Chicago-based airline has 11,675 active pilots.

To date, 6,000 employees have agreed to quit the airline and another 26,000 have taken voluntary leave programs, the company said July 21.

Airline labor unions, including ALPA, have been vigorously lobbying Congress to extend payroll support funds for six months to avoid mass industry job cuts in October. The current payroll program—and its protections—ends Sept. 30.

La-Z-Boy to lay off 850 people, close Mississippi plant

La-Z-Boy Inc. said late Thursday it will lay off about 10% of its workforce, or 850 employees, across its business and including an upholstery factory in Mississippi. 

• Since layoffs were announced in March, La-Z-Boy had helped the community by making face masks. But it says the COVID-19 pandemic hurt its bottom line and the realignment is necessary to survive.

Production will be shifted to available capacity at the company's plants in Tennessee, Missouri, and Arkansas, La-Z-Boy said. The Mississippi plant, built in 1960, employs about 300 people and accounts for about 10% of the company's upholstery production as well as making the company's recliners and other furniture.

The coronavirus pandemic "has had a far-reaching impact," Chief Executive Kurt L. Darrow said in a statement. The company "responded quickly" and as a result "we are confident we will emerge from the crisis with strength and remain a leader in the industry," Darrow said. " Since restarting production at the majority of our plants at the end of April, we have steadily increased production and continue to bring back more employees to meet demand." It is appropriate, however, to "right size" the business, Darrow said. "Still, these are difficult decisions to make and we deeply regret the impact they will have on those employees who are affected."
La-Z-Boy expects to spend about $5 million to $7 million in fiscal 2021 in pre-tax charges related to these moves.

AutoNation cuts 3,500 jobs

AutoNation, the country’s largest auto dealer, is eliminating 3,500 workers, about 50 percent of them furloughed due to the coronavirus.

Marc Cannon, executive vice president, confirmed to FOX Business the impacted employees were part of the initial 7,000 furloughed as efforts were made to become more nimble.

“The actions are a result of a successful move to digital and store efficiencies,” Cannon explained.

Tui to slash up to 8,000 jobs

European travel giant Tui plans to slash up to 8,000 jobs as the coronavirus crisis forces it to cut costs.

That number includes positions that “will either not be recruited or reduced” under a plan to trim overhead costs by 30 percent, the Germany-based conglomerate said Wednesday.

The company with more than 70,000 employees around the world called the pandemic “the greatest crisis the tourism industry and Tui has ever faced.”

“Tui should emerge from the crisis stronger. But it will be a different Tui and it will find a different market environment than before the pandemic,” CEO Fritz Joussen said in a statement. “In order to return to the successful development of the past years after the crisis, we must now implement the realignment quickly.”

Tui, which owns airlines, cruise ships, hotels and travel agencies, reported a 10.1 percent drop in revenues for the first three months of 2020 as the virus destroyed demand for travel.

Business was strong before the crisis hit, with revenues growing 6 percent from October through February before virus-related travel restrictions forced the company to “largely discontinue” its business, according to a press release.

While the company said it’s getting ready for travel activities to resume in Germany and Europe, it recently got a loan of 1.8 billion euros (about $1.9 billion) to shore it up until business can get back to normal.