Gogo To Furlough 60 Percent Of Employees

Inflight internet company Gogo has announced that it will be furloughing 60 percent of its employees due to the economic impact of the coronavirus (COVID-19) pandemic. The furloughs are expected to go into effect on May 4 and affect more than 600 employees. Gogo has also applied for $81 million in grant money and a $150 million loan under the Coronavirus Aid, Relief and Economic Security Act (CARES) Act. If it receives that money, the company says it will “modify the personnel actions announced … to comply with the terms of that assistance.”

“Based on where the market is today, we believe these personnel actions are necessary, and if conditions worsen, we have additional levers to pull if needed,” said Gogo CEO Oakleigh Thorne. “The impact of COVID-19 on air travel, and a challenging economy in general, mean we have to make tough decisions, including implementing these essential cost reductions.”

Other personnel-related cost-cutting measures announced by Gogo include a hiring freeze, suspension of 2020 merit salary increases, 30 percent salary reductions for the company’s CEO and board of directors and deferral of the CEO's 2019 bonus. According to Gogo, it saw a 95 percent drop in passenger traffic on commercial airlines using its service this month resulting in projections of a 60 to 70 percent reduction in sales for April. Gogo’s business aviation segment logged an increase in requests for one-month account suspensions while new plan activations decreased significantly.