These are testing times for Aer Lingus Staff at Shannon – Breen.

October 15th, 2009 - Pat Breen

This week, Deputy Breen raised on the Dail’s Adjournment Debatethe recent announcement by Aer Lingus that they are to shed 102 Cabin Crews Jobs in Shannon. Deputy Breen said “These are testing times for Aer Lingus and its staff, particularly those based at Shannon Airport. The airline’s lamp is burning through its cash reserves faster than it can refill it and by the end of the year its cash reserves are expected to down to €400 million from €803 million in 2008. Some of the airline management’s decisions in the past few years have been questionable and have left the airline in a precarious position. It has spent €180 million cash on the purchase of two Airbus aircraft and has also been a casualty of fuel hedging and while it claims that this reduction in cash reserves is due to a combination of reduced sales and high staff costs, I understand that it is due to save up to €55 million a year in staff costs from January 2010 as a result of cost savings agreed with staff in the last restructuring plan.

Unfortunately Aer Lingus staff at Shannon and the people of the mid-west who will once again pay the greatest price for these bad decisions. Aer Lingus has been continually undermining and downgrading its Shannon operation for several years. It now plans to shed 102 cabin crew jobs at Shannon which will have serious implications for future transatlantic services at the airport. Aer Lingus has failed to sign up to use the new state of the art US pre-clearance facility and there is no reason by Aer Lingus cannot negotiate an agreement with the US Port Authorities which would facilitate their Shannon passengers. It flies into terminal four in New York which has a domestic baggage claim area used by Delta, Northwest and Virgin America operating domestic services and the situation in Boston is similar with a domestic baggage claim area available which is used by Southwest for its domestic routes.

Its US advertising campaigns are tilted in favour of Dublin Airport as the two most recent campaigns testify. It now plans to reduce the New York El 111 service from Shannon to a thrice-weekly flight. Bookings for the Shannon-New York Service to the end of March 2010 are well ahead of bookings on the EI 105 Dublin-JFK service but I am amazed that the airline plans to operate its Shannon service on Tuesdays, Thursdays and Fridays two of which days have traditionally been poor for bookings on the New York route. I believe the airline is intentionally running down the Shannon operation to show that the Shannon service underperforms against the Dublin one.

I have constantly pointed out the need for the airline to review the timing of its Shannon Flight. El 111 should depart at 9 or 10 o’clock in the morning which would allow the Airline to compete for the 30,000 passengers who travelled with Delta Airlines last winter which is not operating from Shannon this winter.

I hope that the Minister of State at the Department of Health and Children, Deputy Moloney will tell the Minister for Transport that what is needed now is an urgent meeting with Christoph Mueller who has not had sufficient time to make himself au fait with the Shannon situation and I am calling on the Minister to arrange this meeting.

The Government has a 25% shareholding in Aer Lingus and has appointed directors to the company. The Minister must have learned lessons from the Shannon-Heathrow debacle last year and I urge him to act and arrange this meeting immediately.

Deputy John Moloney: Subject to that duty the Minister has mandated the State-nominated directors to seek to ensure that all decisions or the company that have significant implications for wider Government, aviation or regional development policies are considered at board level. In any such decisions they are directed to seek to reconcile commercial and public policy objectives. The Government is satisfied from all of the information available to it that a major restructuring of the group’s cost base is essential if Aer Lingus is to survive.
The Minister understands that approximately 100 of the 676 job losses currently being sought by the company will be at its Shannon Airport base. Job losses are particularly regrettable in the current economic climate and the Minister and I have every sympathy for those whose jobs are currently on the line. The Minister understands that a consultation process between management and staff is now underway and he encourages all parties to engage constructively in that process. The industrial relations mechanisms of the State are available to assist in reaching an agreed outcome for all concerned.
From an aviation policy perspective, the cornerstones of Government aviation policy are competitiveness and connectivity. A viable Aer Lingus is key to ensuring the achievement of these objectives. In Ireland, our priority now is to ensure that we can sustain continued air access to key business and tourism markets. Competition among airlines serving the Irish market has been the cornerstone of our aviation policy resulting in dramatic growth in air services and passenger numbers over the past 10-15 years until the advent of the global downturn. The best way to maximise Ireland’s air connectivity is to see Aer Lingus returned to a stable footing to allow it compete aggressively in the current very difficult market environment.
This is a difficult time for Aer Lingus. I ask all stakeholders and regional interests to lend their support to the airline to ensure it has a viable independent future for the benefit of tourism, business and the country’s economic recovery.