Wednesday, Continental Airlines, Inc. (CAL: News ), in an employee bulletin, said it will cut around 500 positions in its reservations department and shut down its Tampa reservations center, effective July 19. The move is attributed to decreased call volumes on a consumer shift to web self-service amid the global economic recession.
Underlining the difficulties hounding the airline industry, Continental Reservations and eCommerce Vice President Martin Hand said, "Adding to the structural decline in call volumes caused by the Web has been the effect of the global recession, which has resulted in fewer calls into our reservations centers."
The airline said that it is offering a number of voluntary programs to employees, including an early-out severance program and Company Offered Leaves of Absence. Additionally, Continental stated that Tampa Reservations agents who otherwise would not be furloughed can transfer to other reservations centers in Houston and Salt Lake City.
The airline also said that it will offer outplacement services at all three Reservations centers and relocation assistance to affected employees.
It was in June 2008 that the Houston, Texas-based airline had announced that it would eliminate nearly 3000 positions including management positions, through voluntary and involuntary separations, with the majority through voluntary programs. The downsizing represented nearly 7% of its total workforce.
At the time, airlines floundered in a milieu of skyrocketing fuel prices and sought relief mostly by implementing a series of measures including raising fees, slashing jobs and reducing their capacities.
On April 22, Continental Airlines reported a wider loss for the first quarter of 2009, hurt by significant declines in high yield traffic as many business travelers curtailed travel or purchased lower yield economy tickets.
Net loss was $136 million, or $1.10 per share, compared with a loss of $82 million, or $0.82 per share, in the year-ago quarter. Operating revenues dropped 17% to $2.96 billion from $3.57 billion in the prior year.
CAL is currently trading at $10.81, down $0.65 or 5.67%, on a volume of 2.23 million shares on the NYSE.
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