In a significant move to enhance its financial health and operational efficiency, SpiceJet, a major player in the aviation sector, is reportedly on the verge of reducing its workforce by a substantial margin.
Sources close to the matter indicate that the airline is expect to layoff of at least 1,000 employees. The airline views this decision as a strategic effort to tackle its current financial challenges and optimize operations in a highly competitive market.
The Urgency of Cost Management
The decision to streamline its workforce comes at a time when SpiceJet is navigating through turbulent financial waters, marked by legal hurdles and operational complications.
With a current workforce of approximately 9,000 individuals, the airline’s officials have noted an imbalance in the ratio of manpower to aircraft, prompting a reevaluation of its operational necessities.
Significant Workforce Reduction Planned
According to sources familiar with the matter, SpiceJet plans to reduce its workforce by 10-15%, impacting around 900-1,350 employees across various departments.
The airline expects this decision to save approximately ₹100 crore annually. Management is currently preparing the final list of affected employees, incorporating inputs from all department
Operational Restructuring and Challenges
The layoffs are expected to span across multiple departments, with the final decisions and lists being meticulously prepared by management and consultancy teams.
This reorganization effort follows the discontinuation of operations on selected routes under the Regional Connectivity Scheme (RCS), which have historically required a higher number of staff, particularly in lower salary brackets. The task of relocating affected employees poses an additional challenge for the airline.
Current Fleet and Future Focus
Currently, SpiceJet operates a fleet of 30 owned and 10 leased aircraft. Despite the financial difficulties, the company remains committed to upgrading its fleet and improving performance.
In a recent meeting with senior officials, Chairman and Managing Director Ajay Singh emphasized judicious spending and stated that he would personally oversee major expenses.
Uncertain Future for Employees
While SpiceJet has not officially commented on the potential layoffs, the news has created anxiety among employees. Many face uncertain futures as the final decision is expected to be made this week.
Industry Experts’ Weigh-in
Industry experts believe this move signifies SpiceJet’s struggle to navigate financial turbulence. Airlines across the globe are facing rising fuel costs and other operational challenges, making cost-cutting measures crucial for survival.
However, such large-scale layoffs can have a significant impact on employee morale and operational efficiency.