Coronavirus: IndiGo Cuts Senior Employees' Pay, CEO Takes 25% Hit
Here are 10 things to know about the IndiGo pay cuts:
"With the precipitous drop in revenues, the very survival of the airline industry is now at stake," the IndiGo CEO wrote in an email to the airline's staff. "We have to pay careful attention to our cash flow so that we don't run out of cash."
The CEO, who himself took a hit of 25 per cent in his pay, also wrote to IndiGo employees that he know how hard it is for families to take a cut in "take home pay".
"With a great deal of reluctance and a deep sense of regret, we are therefore instituting pay cuts for all employees, excluding Bands A and B, starting April 1, 2020," Mr Dutta wrote in the letter. Most of IndiGo's staff belongs to bands A and B.
Employees at senior vice president and higher roles will take a pay cut of 20 per cent, My Dutta wrote, and vice presidents as well as cockpit crew will take a salary cut of 15 per cent.
Assistant vice presidents, cabin crew and "Band D" employees will take a pay cut of 10 per cent, whereas a 5 per cent cut will be applicable to "Band C" staff, the CEO said.
Earlier on Thursday, the Ministry of Health and Family Welfare said the number of coronavirus cases in India had risen to 169, after 18 fresh cases from various parts of the country.
IndiGo had only last week said it expects its earnings for the January-March period to be impacted, citing a sharp decline in bookings due to the coronavirus outbreak.
Daily bookings dropped 15-20 per cent on a week-to-week basis in recent days, following a modest impact of the coronavirus in January and February, IndiGo said in a statement dated March 11.
Earlier, Interglobe Aviation - which owns and operates the Indigo airline - said it had cancelled its flights to China and Hong Kong, and also reduced the frequency to some South East Asian countries.
The coronavirus is hurting passenger airlines that are staring at a revenue loss of over $100 billion this year, an industry body has warned.