BERLIN: German aircraft engine manufacturer MTU Aero Engines said yesterday it is planning to cut at least 1,000 jobs as the impact of the coronavirus continues to hammer the aviation industry. "By the end of 2021, the company aims to reduce capacity at its German and international locations by a total of around 10 to 15 percent," the company said in a statement.

Headquartered in Munich, MTU Aero Engines employs more than 10,000 people worldwide and provides maintenance services as well as engines for military and commercial planes. "As a result of the pandemic, the aviation industry will remain under pressure for some time to come," CEO Reiner Winkler was cited as saying.

"It will be years before air traffic-which is the foundation on which our activities in series production and our maintenance business rest-returns to pre-crisis levels," he added. The company hopes however to avoid compulsory redundancies, making the savings instead through partial retirement, early retirement and other arrangements. Travel restrictions introduced to slow the spread of the coronavirus since March have put a stranglehold on the aviation industry around the world.

European aircraft maker Airbus said last week it is planning to cut around 15,000 jobs worldwide, 11 percent of its total workforce, in response to the "gravest crisis" the industry has ever seen. Germany's Lufthansa, Europe's biggest airline group, has been granted a nine billion euro ($10 billion) bailout from the German government, saving it from bankruptcy as a result of crushed travel demand.

Meanwhile, new orders for German manufacturing firms rebounded in May as coronavirus lockdowns eased, official data showed yesterday, but the smaller than expected increase highlights the long road ahead for pandemic-hit economies. The closely-watched indicator of future industrial activity climbed 10.4 percent month-on-month, federal statistics agency Destatis said, after a historic 26.2 percent slump in April.

Economists surveyed by Factset had predicted a 17-percent jump in May orders. The economy ministry said the latest data suggested "that the industrial recession has bottomed out" in Germany. But with order intake still almost 30 percent lower than in May 2019, "the catch-up process is far from over", it added.

Domestic orders and those from inside the eurozone rose sharply in May, but demand from non-euro nations only climbed two percent compared with April as countries emerge from lockdown at different speeds. ING bank analyst Carsten Brzeski said German industrial orders had staged a "comeback" in May. "But the return to pre-crisis levels will not be easy." - AFP