Aer Lingus, the Irish flag carrier, is set to undergo a significant shake-up as it attempts to mitigate the impact of soaring oil prices. The airline, owned by London-listed International Airlines Group (IAG), plans to cut up to 500 jobs and eliminate several less profitable routes from its network. This move follows an earlier reduction of senior management roles by a quarter, highlighting the company's efforts to trim costs and adapt to the challenging economic landscape.
The proposed measures are expected to reduce overall flying capacity by 6 per cent, affecting both long-haul and short-haul services. Aer Lingus will reportedly axe 70 pilots, 140 cabin crew, and 290 jobs in its head office at Dublin Airport. The flights on the chopping block are all out of Dublin and include destinations such as Denver, Las Vegas, Minneapolis, and Split in Croatia.
High jet fuel costs and supply chain disruptions, exacerbated by the Iran conflict, have weighed heavily on IAG's earnings. The company expects to spend about £1.72 billion more than planned on fuel this year. IAG chief executive Luis Gallego stated that all airlines need to increase fares to mitigate the impact of the fuel price increase, which represents about a quarter of their costs.
Aer Lingus is targeting an operating margin of 12-15 per cent in the medium term to attract further investment. However, its 2025 operating margin of 11.1 per cent lags behind the more than 15 per cent achieved by fellow IAG-owned carriers British Airways and Iberia.