XL.com/Excel Airways
 

Dear Colleague
The last twelve months have seen a lot of change in our industry. We are facing tough competitive pressure both from the low cost carriers and the consolidation of the tour and travel industry. The internet increasingly provides opportunities for our customers to tailor make holiday solutions that more closely match their individual aspirations – eating into the traditional package holiday market. I do not need to tell you that the travel industry is in effect a barometer for whatever is happening globally. Headlines about global warming, which unfailingly emphasise the impact of air travel, have been made real in our home market with the devastating floods in parts of the UK. Interest rates have gone up and the property market has softened – weakening the demand for holidays. Fluctuations in the US and UK economies along with an increase in fuel price have put an additional burden on our costs. Closer to home we have suffered a number of operational setbacks that impact on our costs and our reputation.
We are by no means alone - this is the reality of the challenge that faces the whole industry.
The impact for us is that we will be well short of achieving our profit target for this year. I am sorry to have to inform you this means we will be unable to pay out the profit related company bonus, as it is a long way below the threshold we set.
It also means that we will need to change our business model to restore the company to an acceptable level of profitability.
We have three urgent and important tasks to manage within next year’s budget -
Maximising revenue opportunities
Reducing costs to make the business viable and remain competitive
Achieving customer service and operational performance that will delight customers and ensure repeat business
The fleet will be simplified with the removal of 747s, 757s and 2 x 767 aircraft. We have cut back winter capacity and achieved good winter lease out opportunities, with the result that traditional winter losses for 07/08 are forecast to be better than those for 06/07. We are currently evaluating options for the 2008 summer schedule and regional bases with reduced fleet; this will again give a better gross revenue contribution than the current year. Once fleet plans are finalised, the crew plans can also be firmed up. All indications are that we will need less crew to cover the operation than currently and we will be consulting with BALPA and AMICUS about this issue.
Our costs are too high for a business of our size and I am setting a cost reduction target to be achieved progressively over the coming six months. We have procurement and treasury experts who have been given tough and ambitious targets. We have estimated that there are significant savings available, by buying smarter and managing our money more effectively.
We urgently need to address the costs of our overhead and support activity. Along with the reduction in capacity, we can make manpower savings by working differently and consolidating activities across the group. I am asking each department head to identify savings in support activity in their area of at least 20%. Not all of this needs to be manpower and some of these savings will be dependant on systems investment, so will not be achievable immediately – but radical change to the shape and direction of the business will be needed.
At the same time we need to maintain our focus on our customers and ensure that the services we offer add value and that our operational performance is competitive.
Change can be extremely unsettling and I know it will be important to you that it is managed consistently and fairly. We will be following a thorough process to identify where we can make savings and over the next few weeks you will be briefed by your manager about how any changes may affect you. The timescales are tight as this work will be completed so that the improvements required can be built into the 2008 budget.
We will involve you as much as possible in the process and intend to keep you fully informed along the way.

your first post and you find it " funny " that peoples jobs are under review!! :mad:hope your never in that position!

xl
 

This is an internal and therefore confidential memo - should it be posted on Internet?

THAT MEMO SHOULD BE TAKEN OF THE FORUM!!! As UFGBOY says is an internal memo. One thing is talk about it and other thing is writting it word by word

Nick22 I think you should delete the memo. That was not nice of you!

Glad youve changed the "how funny"! to as expected........ although i wasn't "expecting" it!

I actually work for this company and I am sorry to say but I m glad they going that way. Been with them for nearly 4 years and it s getting worse and worse. I m just staying in this company just to see how they gonna end up. Unfortunatly, we all gonna lose our job but they do not deserve to be in the industry. Not nice at all !!!!!!!

not looking good for us.
we've all (perm contracts) been drop filed five options to choose from:
50% winter
voluntary redundancy
18 months sabatical
5 months unpaid winter leave
or.... none of the above suit.

gotta say it feels like a huge slap in the face as we're the ones who've had to struggle through delays,tech aircrafts etc whilst the company decide to sponser west ham for a huge fee :rolleyes::rolleyes:,spend £££££s on a outside firm to advise on rebranding,new advertising,new uniform etc......
they've just haemorrhaged money

off the job centre for me!

I also work for the company and I think that if you dislike it so much you should leave, so the rest of us can stay!!!

Do you really think they gonna survive??? Dont think so

Nick22
 

Nick22 may I just say that your last comment was at best unhelpful. I don't work for XL but have worked for airlines where I was concerned about the future and I know I wouldn't have appreciated comments like yours. I know that this is an open forum but comments like "do you think they will survive, I don't think so" are ill informed and only serve to annoy and/or worry XL staff.

Firstly, how irresponsible and immature to post an internal memo on an open forum. What, exactly, do you hope to gain from doing this, aside from grinding your obvious bitter axe? Absolutely no need..:=

Secondly, and precisely for those who cannot read, the 20% cuts are not specifically aimed at head count alone. It remains to be seen whether or not this will be the case, it may well be, but infrastructure, budgets (marketing?), systems and procedures will all be scrutinized.
Tartcart - hadn't heard that these options had been posted already, but sorry to hear your news. Not much of a help, but the majority of charter operations cut back for the winter, but am sure you knew this already. With regards to your comments about sponsorship, rebranding etc these are unfortunately necessary evils, and although may seem as though money ill spent, it does pay dividends to the company as a whole.

Lastly Nick22, please share with me and the group your rationale and certainty behind the comments about the company not surviving? They appear, to me anyway, to be taking some fairly hard decisions and proactive steps to ensure they survive in a very cut throat indusrty and market place. You, obviously, have different information. Or do you?

avgas321 well said!

Being crew with XL it is a very tough time.

First the memo was released stating that these changes were to occur. Most of the crew knew that the 747 and 767-200 and 757`s were going so that was no big surprise, but what we do want to know is what we can expect in the future.

The memo states that changes have to be made, but reading it, does indeed makes it seem that the company want to make the systems and procedures more streamlined to improve efficiency and reduce our cost, helping us to be more competitive.

I think everybody in the company would love a more efficient company, one with a bright future, but unfortunately it`s going to take some sweeping stages.

I know that the recent "poll" of crew about future plans has caused, as expected a large rucus. We all want to know what the repercussions are of selecting one option over another. People are, at the moment very worried, and with it being a bank holiday there have not been any real communications to try to allieviate some of the fears that people have.

The crew in XL are an excellent one, well motivated, friendly always hard working and I have made some great friends. I just hope that the main asset that XL have, the people within the company, are well treated despite these changes.

I know that some people are quick to try to jump on the worst case scenario route, but I see a glimmering light in the future. We will soon be equiped with new long haul aircraft, so with the mixture of these, plus the new 737-900 and existing 737-800 passengers will have a fleet of modern aircraft. The dispatch reliability will greatly improve and the overall product as a whole that we are able to provide will drastically improve.

Whilst a lot has been said for the West Ham sponsorship, it will no doubt raise awareness of the company`s existance, that is surely a good thing, and let`s hope that we can generate more money that we plough into them. In the end most weekends we are getting world wide exposure, and for the figures that we have spent to do that is frankly cheap.

I know that some people may disagree with what I have said, but we have to look to the future and see what it holds, but I do feel that once this period has been overcome, the future appears to be very strong indeed.

For someone who has recently left XL, and who has alot of friends there i feel very sad about the whole thing.

They are a great company to work for and if i hadn't been offered a slightly better position i'd still be there.:)

I think as long as the fleet have been streamlined then everything will start to work it's self out.

It's a differcult time for many airlines at the moment and sometimes the only way to survive is to make forced savings. Unfortunately these savings usually start with the work force.

Without stating the blindingly obvious, it's going to be a tough winter at XL but with the characters they have at the company i'm sure they will be fine.

Good luck to you all.:ok:

Nick22
Thank you for posting that memo.
I am sure that many SLF's reading this are better informed now to the state of this airline.
SLF pay a lot of money up to 11 months in advance to fly with airlines and things like this they need to be aware of, as its their hard earned cash that could be going down the pan.
Well done

I think the thought of XL going down the pan is a bit drastic really!:}

They have numerous A/C either wet or dry leased during the winter and summer months that will bring in a reasonable amount of money over the next few years which will help!

As i've said before, it's a slight over sight on behalf of the Directors and Managers and a case of 'too much, too soon'!:= It will always work itself out.

Granted i can sit pretty as i don't have to worry about my job and i feel for my friends and ex collegues within XL.

Strange isn't ? I bet Nick22 was one of those people moaning that XL would never be any good because they fly old and knackered aircraft, weren't they asking the company to get new more reliable aircraft ?

Well the company listen, go out and get new reliable aircraft, which ofcourse has a price to pay, and that's wrong - makes you wonder why they bother !!! :ugh:

And for what it's worth i also agree that it's wrong to reproduce an internal company memo on Pprune. Nick22 (IQ or age?)- only some deluded cabbage would write "I'm just staying in this company just to see how they gonna end up"
Good luck

Get over it mate !!

The thing I cant work out, is that at worker level, engineers, crew, ground staff and pilots, terms and conditions across the whole charter business are not too different. It has just got to be down to 5hite Directorship.

From the sharp end of the jet, to a new joiner school leaver, we all do a job that keeps em flyin. XL have had no disasters and the "old dog jets" keep flyin.

Sack the whole Board and start again!

Oh and when I say sack, I mean for Gross Misconduct, not with a golden parachute! Accountability without compensation! Its the way forward in business.