Pink Slip Parade: Delta Gives Axe to Some Corporate Staff
Well, well, well, it seems Delta Air Lines is trimming the fat. The airline recently announced layoffs in their corporate and management ranks as part of their ongoing cost-cutting efforts.
Of course, they didn’t specify exactly how many employees would be getting the pink slip, and they made sure to reassure us that this won’t affect the folks on the front lines – you know, the pilots and flight attendants.
Delta’s statement to CNBC had all the usual corporate jargon about making “adjustments to programs, budgets, and organizational structures.” Translation: “We’re slashing jobs to save a few bucks, and don’t ask us how many.”
While we’re not yet back to full capacity, now is the time to make adjustments to programs, budgets and organizational structures across Delta to meet our stated goals — one part of this effort includes adjustments to corporate staffing in support of these changes. These decisions are never made lightly but always with care and respect for our impacted team members and the Delta family.
Delta statement to CNBC
It’s interesting to note that not too long ago, Delta, along with other airlines, were hiring like there was no tomorrow. The post-COVID revenge travel boom was in full swing, and airlines were in a rush to bring more hands on deck.
But now, that boom seems to be drying up faster than a puddle in the desert. International travel, especially to Europe, is still hanging in there, but domestic demand is taking a nosedive. Delta might be the first major airline to publicly announce layoffs, but it’s not the only one feeling the heat.
Spirit Airlines recently put a halt on hiring, citing a drop in demand and Pratt & Whitney engine issues with their A320neo fleet. The airline industry is facing some headwinds, no doubt. However, we can’t paint the whole industry with the same brush just yet. It appears that most of the pain is being felt by low-cost carriers, and that’s probably because the bulk of their routes are domestic. While Southwest hasn’t announced any broad personnel actions just yet, they did make positive changes to their Rapid Rewards program – usually not something you see when times are good. If you were placing bets on broad layoffs at a legacy carrier, you might want to keep an eye on American Airlines, as their international route network isn’t as robust as their peers, and they’ve had a rough couple months financially, owing to payouts tied to new union contracts.
Of course, there’s always the possibility that Delta just went on a hiring spree during COVID and is now realizing they’ve got too many cooks in the kitchen. Maybe they should’ve thought a little more strategically before expanding their corporate team.
Some are speculating that this could be payback from frequent flyers who are none too pleased with the recent changes to Delta’s SkyMiles program. Medallion status is now all about how much cash you’re shelling out, and it’s a lot harder to attain. SkyClub access has been tightened up, and those Delta Reserve and AmEx Platinum cardholders can kiss their unlimited access goodbye.
Sure, Delta tried to appease their elites with a partial rollback, but CEO Ed Bastian, aka “Fast Eddie,” pretty much spilled the beans to investors that this is just a temporary move. Looks like Delta has shown its true intentions, and it’s not sitting well with the loyal flyers. However, it’s likely that if this is in fact the cause, we won’t see any empirical evidence of this until at least Delta’s next 10-Q.
So, what’s really going on at Delta? Are they just streamlining their operations, or are they facing a rebellion from their most loyal customers? Only time will tell, but one thing’s for sure – the airline industry is in for a bumpy ride.