Airtours in line to cut more jobs as bookings fall 30%

War on Terrorism: Travel Industry

Airtours, Britain's second-largest tour operator, is considering a round of redundancies as a result of a 30 per cent fall in bookings since the attacks in the US. Tim Byrne, the chief executive, said yesterday: "We live in an uncertain world and at the end of the day we will do everything we can do to tighten our belts. If that means job losses then it will have to be job losses."

However, he said Airtours had "considerable flexibility" in its workforce which includes call centre staff which can be asked to work shorter hours. Rival tour operator First Choice Holidays is also expected to announce job cuts soon.

After the market had closed on Friday, Airtours announced that the terrorist attacks would cause a £10m hit on profits. The company also said it would cut its winter holiday capacity by 10 per cent.

Mr Byrne said it could cut its summer 2002 capacity relatively easily by choosing not to renew contracts with third-party carriers which fly 25 per cent of its passengers.

Mr Byrne said consumers were behaving "very nervously" following the attacks. "We are not seeing any cancellations though people are nervous of places like Dubai and Thailand. But the western Mediterranean and the Canaries are fine. Mr Byrne denied that prices were being cut to entice holidaymakers to book.

There were mixed signals on the high street. Some high street stores said sales were still well below normal levels. But one senior executive at a major retailer, who was more positive, said: "On one hand we don't know what the political situation holds in store and a rise in redundancies would affect confidence. But on the other hand you could argue that if people aren't going on holiday then they've got nothing else to do but go shopping."