Air Vanuatu to cut 170 staff in restructuring effort

Nearly 200 employees have been let go as liquidators move to restructure Air Vanuatu in a bid to lower the struggling airline’s operational expenses. Around 170 staff members have been laid off as part of the efforts to “prepare the business for sale or recapitalisation.” Prior to the commencement of the liquidation process on May 9, the airline had a total of 441 employees.

The news of the job cuts was delivered to the affected employees earlier today by Ernst & Young Australia liquidator Morgan Kelly. Kelly emphasized that while the restructuring at Air Vanuatu is indeed unfortunate, it is deemed necessary to pave the way for potential new investors and to capitalize on the strong demand for both domestic and international travel. He further stated that the objective of this restructuring is to position Air Vanuatu for future growth.

Amidst its financial struggles, the liquidators are determined to find a viable solution for Air Vanuatu. They echo the sentiments of the Vanuatuan government regarding the robust tourism demand fueling international travel interest, and in turn, supporting the need for key domestic flight routes. The liquidation process also saw the appointment of Justin Walsh and Andrew Hanson as additional liquidators.

Air Vanuatu holds access to airport slots in several international locations such as Brisbane, Melbourne, Sydney, Auckland, New Caledonia, and Fiji. The decision on whether the airline will be able to continue its operations post-restructuring has yet to be finalized.