SHANGHAI - CHINA Eastern Airlines, which has announced a seven-billion-yuan (S$1.5 billion) government bailout, plans to cut executive pay by up to 30 per cent, Chinese media reported Thursday.
The carrier, struggling with dwindling passenger numbers and potentially hefty fuel hedging losses, is slashing wages of middle to senior managers by 10 to 30 per cent from January, the Beijing News said, citing an unnamed executive.
'China Eastern must take action to rescue itself,' the executive was quoted as saying, without disclosing when the salary cuts would end.
China's aviation industry had a bad year in 2008 as travel demand slumped amid the global financial crisis. The nation's biggest carrier China Southern Airlines cut pay for its management by 10 per cent in July.
China Eastern posted a 2.3-billion-yuan loss in the first nine months of 2008.
It also reported US$420,000 in realised losses as of the end of November from fuel hedging contracts, warning that the losses could increase with further declines in global oil prices. -- AFP
