=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2005/01/18/f= inancial0850EST0029.DTL --------------------------------------------------------------------- Tuesday, January 18, 2005 (AP) Swiss International Air Lines announces 1,000 job cuts under new cost-savin= g plan PETER HODY, Associated Press Writer (01-18) 05:50 PST ZURICH, Switzerland (AP) -- Switzerland's struggling national airline will cut up to 1,000 jobs and shrink its fleet by 15 percent as part of a second wave of restructuring aimed at saving $250 million a year and restoring the company's health. Swiss International Air Lines also said Tuesday it will downgrade its operations at airports in Geneva and Basel, with partner airlines taking over these flights, while the Swiss carrier focuses on its Zurich hub. The airline's shares jumped 12 percent to 10.55 Swiss francs ($8.92) when they began trading in Zurich at noon Tuesday. They had been suspended Monday ahead of a meeting of the company's board. The company, known as Swiss, has suffered massive financial problems sin= ce it was created out of the defunct Swissair in 2002. It also has felt the bite of high oil prices and competition from low-cost carriers in Europe. The airline said 800 to 1,000 jobs will be cut over 18 months and that it expected annual savings of 300 million Swiss francs ($254 million) beginning in 2007. "Solutions will be sought together with the company's unions for the personnel affected," the company said, without giving details. Swiss media reports over the weekend claimed that the airline's manageme= nt was planning to create a separate company to run its European operations with lower salaries, but the airline did not take this step. However, it said it planned more cost-cutting talks with unions. "Cost savings are also expected through the imminent negotiation of the collective labor agreements," it said. Under a previous cost-cutting package, Swiss already was aiming to reduce annual costs by 1.6 billion francs ($1.36 billion). That plan involved slashing the number of full-time staff by more than 3,000 since the end of 2002, to around 7,250. Swiss also cut its fleet from 132 to 85 aircraft and trimmed destinations from its schedule. After a series of heavy losses, it swung into profit in the third quarter of 2004, earning 16 million Swiss francs (then $14 million). It has not yet reported full-year figures for 2004. Swiss said while it was buoyed by its long-haul service, results from its European flights were less than satisfactory. Studies show its European network cannot be operated profitably without a shake up, it noted. "The progress we have achieved to date in improving our cost structures and tapping revenue potential is impressive, but is by no means enough given the present market trends," President and Chief Executive Christoph Franz said. "The additional actions we have now resolved are essential to make Swiss sustainably competitive and create prospects for growth." ---------------------------------------------------------------------- Copyright 2005 AP