Alexa

CAL will cut passenger, cargo flights from June

CAL will cut passenger, cargo flights from June

China Airlines, Taiwan's largest carrier, has decided to cut its transport capacity by 10 percent from June to cope with high oil prices, a CAL spokesman said yesterday.
CAL will drop 100 passenger flights and 50 cargo flights each month on its routes to the United States and Asia, despite the approaching peak summer tourism season, CAL spokesman Bruce Chen said, adding that European flights will be unaffected.
The new measures will save the company an estimated NT$200 million (US$6.6 million) per month, according to Chen.
To fight surging oil prices, CAL has already reduced the weight of its planes and lowered luggage allowances, as well as lowering its operational costs.
The carrier has also proposed cutting the salaries of its 80 executives by 10 percent and asking its employees to accept unpaid leave, which is unacceptable to the CAL workers' union, Union Director-General Chang Hsue-lien said.
The union opposes any form of salary cuts and has decided to call a temporary member representative meeting June 13, Chang said.
At the meeting, the union will ask CAL to explain why the carrier is suffering a deficit and propose other measures to solve the problem, Chang went on.
CAL reported a loss of NT$2.5 billion last year and lost up to NT$2.9 billion in the first quarter of this year, the largest single-quarter loss in its history.
The carrier's deficit in the second quarter is likely to surpass NT$3 billion.
The company attributed the record loss to skyrocketing oil prices, while the union attributed it to the company's mismanagement and blasted the company for placing orders for 14 Airbus planes worth a combined US$4.2 billion early this year.
Noting that plane purchases are part of the company's long-term plans, Chen explained that the percentage of fuel costs in the company's total costs has jumped from 30 percent last year to 48 percent this year.
He claimed that CAL does not have financial problems and that the capacity-cutting measure is only aimed at containing its losses.
Other capital-saving measures regarding employees' interests have yet to be finalized, Chen noted.
Local travel agencies said flight cuts will not cause an increase in summer airline ticket prices because the company has already hiked ticket prices.


Updated : 2021-04-13 10:47 GMT+08:00