El Al Israel Airlines Ltd. (TASE: ELAL) CEO Gonen Usishkin has ordered the company's VPs to prepare an immediate plan for laying off 1,000 of the company's 6,300 employees. Usishkin sent a letter to El Al's VP human resources and the head of the planning department asking for such a plan, to include employees from all sectors of the company: both tenured and temporary workers.
El Al earlier reported to the Tel Aviv Stock Exchange that damage from the coronavirus epidemic was liable to total $70 million in lost revenue in January-April. A 7.5% plummet in its share price today drove El Al's market cap down to NIS 378 million.
These estimates were made before El Al was forced to halt its flights to Italy following more stringent warnings by the Ministry of Health. El Al will call off its flights to its four destinations in Italy for two weeks, starting tomorrow. Flights to Bangkok will be canceled until the end of March, and the launching of the airline's first flight to Tokyo will be postponed until the beginning of April.
CNN predicted that damage to the civil aviation sector from the coronavirus would exceed the damage from the SARS virus in 2003, which was estimated at $7 billion at the time. El Al is waiting patiently for the aid promised by the Israeli government. As of now, the statements and promises received by El Al, including by the prime minister himself, have not been backed by deeds.
Published by Globes, Israel business news - en.globes.co.il - on February 27, 2020
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