(Bloomberg) -- Air Mauritius administrators are running out of time to save the airline as recurrent expenses pile up, costs of servicing leases for new aircraft accumulate and unions fail to give constructive proposals on job cuts.
By the end of March 2021, cumulative losses could reach 9 billion rupees ($225 million) if costs are not cut in the short term, according to a statement by administrators of the company.
“Constructive and reasonable propositions from the unions with regard to collective agreements will allow us to save as many jobs as possible and to mitigate the social impact of the restructuring,” according to the statement. “We need to bear in mind that the more we delay, the options that we have right now will shrink.”
Monthly expenses are about 350 million rupees for wages and 250 million rupees for leases, Sattar Hajee Abdoula, one of company’s two administrators, told Port-Louis based Radio Plus on Monday.
The company known as MK is flying old Airbus A340 planes for humanitarian purposes because it risks newer jets being seized by creditors for unpaid leases, according to the statement emailed by the Stock Exchange of Mauritius.
Under voluntary administration since April 22, MK is facing the biggest challenge in its half-a-century history with the financial strain compounded by the Covid-19 pandemic.
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