This out in confirmation on Speednews today -
Gulf Air this week revealed BD310m (US$825m) "Get Well" Programme to turn the company around. The plan consists of two pillars, requiring investment in aircraft and ground facilities, to completely reshape the network to better serve the needs of the Bahrain and Oman economies and, to improve customer service through higher punctuality, better reliability and lower connection times. Gulf Air says that the airline's operation was currently losing more than US$1m per day, and including other costs such as financing 'the figure would even be substantially higher.' Accumulated losses and costs, including 2007, would amount to BD254m (US$675m).
Under the first part of the program that will cost BD120m (US$319m), Gulf Air will undergo a major restructuring of its operations. The focus is on closing the airline's current profitability gap of BD156m (US$414m), creating a network that serves better the needs of the Bahrain and Oman business community and, increasing Gulf Air's customer service level. To achieve its financial and operational goals, Gulf Air will downsize its fleet from 34 to 28 aircraft by removing nine 767s and nine A340s, and adding eight A330s and four A321s; it also has six A330-200s and 10 A320s. It will operate an all-Airbus fleet. It is expected to take until the beginning of 2009 to complete the fleet replacement and restructuring program.
The second pillar of Gulf Air's "get well" program consists of investments of BD190m (US$505m) to improve the quality of its product on the ground and in the air. The airline intends to refurbish the cabins of its existing Airbus aircraft. In addition, ground facilities, such as lounges, will be upgraded. Parallel to the downsizing of its fleet by roughly 25 per cent, Gulf Air's workforce will have to be reduced, also. Currently, the airline has nearly 6,000 employees. The exact number of jobs that will be cut as a result of the downsizing and restructuring of the company still has to be defined. A portion of the downsizing of the workforce will occur through natural attrition.