Gulf Air, the Bahrain-based carrier, is undertaking drastic measures to restructure operations and cut jobs to revive competitiveness. The company’s plan to lay-off about 15 per cent of it’s staff and close four more routes in January have annoyed the union which represents airline staff.
In recent years, the airline has struggled to compete against rapidly growing airlines such as Dubai’s Emirates Airline, Abu Dhabi’s Etihad Airways and Qatar Airways. The landscape has only become more competitive because of the success enjoyed by budget airlines, like flydubai and Air Arabia. As a result, Gulf Air has been forced to make difficult decisions and restructure its operations
A recently issued company statement points out that “in January a total workforce reduction of 6 per cent was realized. This to date has increased to 15 per cent.” The reduction in workforce has been achieved through non-renewal of contracts, restructuring in outstations, natural attrition and a voluntary retirement scheme. The airline aims to reduce more than 30 per cent of the total workforce of 4,000 employees.
Gulf Air, one of the region’s oldest airlines, was established in 1974 in partnership with Abu Dhabi, Oman and Qatar. The airline gained immense popularity and by 1990 became the largest Middle East carrier, thanks to its wide network and world-class onboard services. By mid-90s, the partners of Bahrain divested their stake and embarked on a mission to develop their own airlines with global ambitions. The airline has struggled in recent years due to political and security uncertainty that shook Bahrain after protests erupted in February 2011. Although the government swiftly dealt with the agitation, nation-wide protests have continued to hurt the national economy.
Gulf Air’s union has started talks with the labor ministry about this matter, but has not revealed its course of action. Bahrain is one of few Gulf nations that have strong labor unions that can take industrial action.