A few days ago in-flight entertainment (IFE) supplier Global Eagle Entertainment entered Chapter 11 bankruptcy protection. Now, rival IFE operator Gogo is laying off staff as the Covid-19 virus continues to impact air travel and a slump in demand.
Gogo says it will eliminate 143 full-time staff “predominantly from the Company’s Commercial Aviation business”.
“As the pandemic continues to impact commercial airline travel, we are taking additional actions as part of our comprehensive 16-lever strategy to reduce costs. Based on our current expectations of the scope and timing of a recovery in the industry and our Commercial Aviation business, reducing our workforce has become a necessary step. We do not take this action lightly, but we believe it is critical in our efforts to preserve our financial flexibility, while maintaining the quality of our service and relationships with our customers,” said Oakleigh Thorne, Gogo’s President/CEO.
The reduction in force will take effect on August 14th, and represents approximately 14 per cent of the Company’s overall workforce. In addition to the reduction in force, Gogo says it will continue certain furloughs and maintain the salary reductions that were previously implemented.
“Gogo will continue to pursue non-personnel cost-savings levers, including renegotiating terms with suppliers, delaying aircraft equipment installations, deferring purchases of capital equipment, reducing marketing and travel expenses, and eliminating non-essential spend,” stated the company.