The aviation industry is in turmoil. As airlines slash spending the supplier network is scrambling to survive. For many of these companies staff furloughs is the name of the game. Panasonic Avionics Corporation (PAC) is the latest in the IFEC sector to implement such moves.
The moves from PAC come in multiple forms. Overall staff numbers are being reduced with furloughs or terminations. Remaining employees are subject to reduced work schedules. Senior executives, including the CEO, have seen their salary reduced.
The company confirmed the moves in a statement to PaxEx.Aero:
Panasonic Avionics has had to take several measures to control costs, and to preserve and protect its business given the sharp falloff in demand from our airline customers resulting from the COVID-19 pandemic. Regrettably, these measures include workforce reductions and furloughs. Impacted employees are being or have been notified, and we are doing everything we can to support them and their families through this difficult time, including offering comprehensive severance and benefits packages, outplacement and employee assistance programs, where applicable.
For employees who remain, PAC has also begun to implement temporary reduced work schedules across its US and global operations. The company is also instituting salary reductions for all senior PAC executives, including its CEO.
While we have done everything possible to minimize the impact of this crisis on PAC employees, these latest actions were necessary given the pandemic’s extraordinary impact on our industry. We are hopeful that these measures will help PAC support its airline customers, limit its losses, and ensure the Company is in a position of strength when the recovery begins.
That any supplier is experiencing furloughs and layoffs is no surprise. Cashflow quickly turned from a waterfall to a dribble and no company will be immune from that impact. The broader question is how the suppliers will adapt and which are better suited to ride out the troubles.
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