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Flight Centre to stand down or sack 6000 as market jumps again

Virus-ravaged travel firm Flight Centre says an initial 6000 of its global sales and support staff globally will either be stood down or made redundant in the company’s latest bid to preserve a future.

Mar 26, 2020, updated Mar 26, 2020
(Photo: Ellen Smith/AAP PHOTOS)

(Photo: Ellen Smith/AAP PHOTOS)

In Australia, where government has installed international travel bans and domestic border controls, about 3800 people in sales and support roles will temporarily stand-down.

This follows similar recent moves by other travel businesses, including Qantas, Virgin Australia and Helloworld.

Australian shares have rallied more than two per cent for a third straight day of morning gains after a massive US stimulus deal sent global markets soaring.

The S&P/ASX200 benchmark index rose 112 points or 2.24 per cent, to 5,110.1 at 1030 AEDT on Thursday.

The All Ordinaries index was up 117.3 points, or 2.34 per cent, to 5,123.5 points with all sectors higher except consumer staples.

The big supermarkets were mixed with Coles down one cent at $16.65 and Woolworths up 15c at $36.57.

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Gold miners were also mixed, with Newcrest up 66c at $26.55 even as Northern Star fell $1.29 to $12.21 and Evolution Mining sank 12.5c to $4.26.

Financial stocks were higher as the big four banks all edged north. CBA gained 0.48 per cent to $62.67 as ANZ added 18c to $16.76, Westpac rose 15c to $16.00 and NAB took on 26c to $16.05.

Global stocks rocketed overnight after US politicians finally reached a deal – yet to be passed – on a $A3.3 trillion stimulus measure to shore up the world’s biggest economy.

A total 6000 Flight Centre support and sales roles across the globe will either be stood down or, in some instances, become redundant.

The company said it will initially retain up to 70 per cent of its 20,000 global workforce but will, however, assess further reductions as the pandemic evolves.

“These never-before-seen restrictions, which have forced airlines to ground their fleets and heavily reduce their flight schedules, have virtually halted travel demand and led to the stoppage of the vast proportion of work that Flight Centre’s people previously carried out,” The company told the ASX.

On Thursday Virgin Australia said more than 1,000 workers will likely be made redundant from the 8,000 asked to stand down from their jobs as demand for air travel plunges.

Helloworld has announced it will be sacking 275 people across its global network and standing down another 1,300 workers.

Qantas is standing down 20,000 of its 30,000 workforce.

Westpac forecasts there will be over 814,000 job losses leading to an 11 per cent unemployment rate by June as a result of coronavirus disruptions.

Flight Centre had already announced it would close up to 100 underperforming stores and has scrapped its earnings guidance amid mounting airline service cuts and widening travel bans.

This week it cancelled its 40 cent interim dividend to save $40.1 million and its shares were voluntarily suspended from trading on Monday after plunging nearly 80 per cent this year to $9.91.

– AAP

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