Virgin to cut 600 jobs days after placing $2.1-billion aircraft order

Virgin Atlantic, the UK rival to British Airways is cutting its winter capacity by 7 per cent, which will result in about 600 employees losing their jobs, just a week after it placed an order for 10 A330 passenger jets worth $2.1 billion. (See: Virgin Atlantic orders 10 Airbus A330; 50 in the pipeline) 

Virgin Atlantic, in which Sir Richard Branson's Virgin Group holds a 51-per cent stake with the rest being held by Singapore Airlines, said today that it would cut winter capacity by 7 per cent by suspending flights to Chicago and reduce the number of flights from London to Hong Kong.
 
Suspension of the Chicago flights comes a decade after Sir Richard Branson invited around 1,000 guests for a lavish party to celebrate Virgin Atlantic's inaugural flight to the windy city.
 
"The outlook for the industry is as bleak as ever and all airlines are having to shrink their businesses. The fittest will survive and be in a stronger position when the economy grows," said chief executive Steve Ridgway in a statement.
 
The statement said Virgin hoped that headcount reduction could be achieved through sabbaticals, job sharing or voluntary redundancy.

With the cabin crew, pilots, operational and administrative staff taking the brunt of the latest job cuts, Ridgway said, ''We will look to minimise the number of compulsory redundancies and ensure we treat our staff as fairly as possible.''
 
Virgin Atlantic had axed 600 jobs last February and had announced a pay freeze from last March, but the airline had gone ahead and ordered 10 Airbus A330 passenger jets worth $2.1 billion and is negotiating with the European aircraft manufacturer for buying an additional 50 A350 aircraft to be delivered from 2014.
 
While placing this large order worth $2.1 billion with Airbus on 22 June, Ridgway had said, "Virgin Atlantic has a strong history of successfully investing during a downturn and our Airbus order today sends a strong signal that now is the time to invest, in order to help protect jobs and get the world's economy moving again."
 
The job cuts comes just a few days after Sir Richard Branson asked the UK government not to bail out its struggling rival, British Airways and ridiculed that the iconic UK airline was virtually worthless.
 
UK's flagship airline British Airways reeling under it's biggest ever loss since 1987 with a pre-tax loss of £401 million, (See: British Airways post biggest ever loss since 1987)  had in a fight for survival appeal, asked its nearly 40,000 employees to work free for a month in July in order to keep the carrier afloat. (See: British Airways wants free one-month's work from employees)