Citing the rising cost of jet fuel and a softening demand for air travel, Pan Am Corp. said Wednesday it will trim its work force by 2,500 and reduce capacity to cut costs.
Chairman Thomas Plaskett said the jobs would be cut next month through furloughs, attrition and voluntary leaves of absence. The cuts will affect management and non-management employees.The amount of savings the cuts are expected to achieve was not immediately available.
Speaking to the New York Society of Airline Security Analysts, Plaskett also said the airline would reduce trans-Atlantic service, adjust its network of domestic feeder flights into New York's Kennedy Airport and add service at its Miami hub and in Latin America.
Overall, the program will reduce the airline's capacity 7.5 percent, he said.
Job cuts at Pan Am were predicted Tuesday by William F. Genoese, director of the Teamsters Union's airline division, which represents about 6,500 Pan Am employees. Pan Am currently employs about 29,000 people.
Plaskett said the company would return five of its fleet of 35 B747 jets on trans-Atlantic routes and substitute more fuel-efficient A310/300s.
He said that while the 412-seat B747 is ideal for peak summer travel, the 192-seat A310 is more profitable on a year-round basis for the routes where it will be used.