NEW YORK – Continental Airlines Inc. (CAL) said on Thursday it plans to cut about 425 management and clerical jobs through staff reductions, attrition and the elimination of unfilled positions to save about $200 million in pretax costs.
The No. 5 U.S. airline, which has been holding on-again, off-again contract talks with pilots since 2002, said the plan is the carrier's latest attempt to reduce its losses without asking for wage and benefit concessions from its employees.
"We continue to struggle to identify additional ways to lower our costs as continued losses jeopardize our survival," Gordon Bethune (search), chairman and chief executive officer, said in a statement. "Unless the revenue environment improves dramatically, we will need to reduce wages and benefits to compensate for the continued losses."
The job cuts are expected to add about $125 million of pretax benefits in 2005 and, when fully implemented by 2007, a run-rate annual pretax benefit of about $200 million.
These cuts, together with earlier reductions will bring the carrier's total work force down 24 percent since Sept. 11, 2001 (search). The Houston-based airline said most of the staff reductions will occur immediately and do not include the 253 previously announced reservations position cuts.
Shares of Continental were up 12 cents, or 1.3 percent, at $9.49.
Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox