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Air Asia Plans Mass Lay-Offs Including 60% of Cabin Crew; Mulling 10% Stake Sale in Airline

Air Asia Plans Mass Lay-Offs Including 60% of Cabin Crew; Mulling 10% Stake Sale in Airline

Air Asia is said to be mulling selling a 10 per cent stake in the airline to the South Korean conglomerate SK Corp according to sources quoted by Malaysia’s The Star newspaper. In response to the news, Air Asia confirmed it is considering a number of proposals to raise additional capital in order to weather the COVID-19 storm but said it was too early to divulge information about specific bids as it risked jeopardising potential deals.

At the same time, the Malaysia-based airline group which also has subsidiaries in Indonesia, Philippines, Thailand, India and Japan, is also making plans to slash its workforce by 30 per cent. The airline group has a total workforce of around 20,000 employees.

Up to 60 per cent of the airline’s cabin crew and pilots could be laid off under current proposals and those who remain may face salary cuts of up to 75 per cent. Sources claim crew bosses have been working through individual employee performance evaluations since January to decide who will be fired. The lay-offs will continue through July.

Air Asia said in a statement released on Friday that it hoped to reach a decision on how to raise additional capital soon. “The Company has ongoing deliberations with a number of parties for joint-ventures and collaborations that may result in additional investments in specific segments of the group’s business,” the airline explained in a statement.

After being forced to ground the majority of its aircraft, Air Asia has been able to resume scheduled domestic flights in Malaysia since late April. Operations have since restarted in Thailand and the Philippines but flight schedules remained severely curtailed compared to pre-Corona levels.

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