The Dublin Airport Authority (DAA) has told staff it will seek up to 400 voluntary redundancies as part of a new cost-containment programme.
In a letter sent to employees this morning, the DAA said it was facing a projected earnings shortfall of between €60 and €70 million. The company is also expected to seek work practice changes for staff remaining on the payroll.
The DAA, which operates Dublin, Cork and Shannon airports, last month at the publication of its annual report, forecast a drop of 11 per cent in passenger numbers this year. DAA management are today in talks with trade unions at the company on its cost-containment proposals.
The State-owned airport manager said last month it expected “minimal passenger growth” up to 2011, and expected to post losses this year and next.
The annual report showed turnover rose by just 1 per cent in 2008 to €631 million, while profit, before exceptional items, fell by 28 per cent to €78 million. The DAA has asked for a minimum €3 rise in passenger charges for 2010 to 2015.
The DAA’s chief executive Declan Collier said a reduction in its workforce was likely as part of its cost-reduction programme.
“One of the options we have to look at is a reduction in the number of staff,” he said, adding that 100 workers had left since the start of 2008. He said the job cuts would apply “right the way across the company”.
DAA employs about 3,200 staff.
DAA’s net debt is set to rise to about €1 billion by the end of 2010, compared with €188 million at the end of 2007. It has halved to €400 million its capital investment plans at Dublin airport for the 2010 to 2014 period.
Dublin airport handled a record 23.5 million passengers last year, a rise of 0.8 per cent on 2007. As a barometer of the decline in customer activity at the three airports, Mr Collier said the DAA’s car park revenues declined last year by about €4 million. Retail and other commercial revenues were also down.
Labour Party transport spokesman Tommy Broughan said the company's announcement was a "major shock" and that the plans would be "devastating for communities in the area". He said any redundancies should be voluntary.
“Clearly the aviation sector is experiencing grave difficulties across the board given the current economic difficulties. There are indications that revenues from parking and shopping at Dublin Airport have dropped, and
profits and passenger numbers will continue to slide through 2009 and 2010, but that does not mean that Airport workers should have to bear the brunt."